Shares in Impax Asset Management fell 11% this morning (31 May) as the firm reported a 46% reduction in profits during the first half of its financial year.
Impax recorded £21.4m of pre-tax profits in the six months to 31 March, just over half of the £39.9m it generated during the previous six-month period, and substantially less than H1 2022’s figure of £32.7m.
The fall in profits came in spite of a £1.2m increase in revenue on the previous half, with CEO Ian Simm attributing the drop-off to Impax’s “investment in people and systems” that he said supported the firm’s growth strategy, and increased operational resilience.
However, the report revealed a £5m hit from foreign exchange losses, most of which it attributed to unrealised losses on the “retranslation of intercompany loans and other assets held in foreign currencies”.
In addition, net cash generated from operating activities fell to £271,000, down from £23.5m during the same period last year.
Earnings per share fell to 12.8p from 24.6p in the previous half, and while adjusted profit was higher at £27.3m, it still sat some £6m below the previous half’s figure.
Aside from the hit to profits, Impax continued to attract new business during the period, adding £1.1bn to assets under management (AUM) through net inflows alone. This, coupled with a strong investment performance, saw AUM jump 12% to £40.1bn.
Having dipped slightly since the publication of the results, AUM stands at £39.4bn as of 30 April.
Simm praised the firm’s “solid” start to its financial year in the face of “challenging” macroeconomic conditions.
He said “Some significant mandate wins during the period also highlight how asset owners and their advisers continue to be attracted to the investable opportunities arising from the transition to a more sustainable economy and, notwithstanding the current backdrop of weak market sentiment, our pipeline of new business remains healthy.”
See also: Impax readies Tokyo office as it lands green subsidy
