Australian Ethical Investment Ltd (ASX: AEF) reported a 29% increase in net profit after tax to $25.7 million for the 12 months ended June 30, 2026, as funds under management (FUM) climbed to a record $14.5 billion.
The group’s underlying profit after tax rose 15% to $27.3 million, while revenue increased 9% to $129.5 million. Operating expenses grew 7% to $90.4 million, though the cost-to-income ratio improved to 69.8% from 71.4% a year earlier. The company maintained a dividend payout ratio of 80%, lifting the total FY26 dividend to 18 cents per share, up 29% from the prior year.
Shares in Australian Ethical surged 12.75% to $5.04 following the results, valuing the company at approximately $375 million. The group’s FUM growth accelerated to a 24% compound annual rate since June 2020, driven by organic net inflows of $664 million, up 13% year-over-year. Superannuation FUM accounted for $10.4 billion of the total, while institutional and investment product segments held $1.69 billion and $2.42 billion, respectively.
Australian Ethical highlighted a $125 million commitment from the Clean Energy Finance Corporation (CEFC) for its new Growth Opportunities Fund. The Private Markets Growth Opportunities Fund delivered a 21.2% return in its first year, exceeding its 10% long-term target. The retail Australian Shares Fund, however, underperformed its benchmark with a -9.6% one-year return, though its long-term track record since 1994 remained strong.
The company also reported improved member growth, with second-half new joins up 20% compared to the first half, and brand awareness doubling to 22%. Employee engagement stood at 77%, while customer service metrics included a 96% call satisfaction rate and a 90% first-contact complaint resolution rate.
Net tangible assets totaled $32.6 million, with a surplus of $22.7 million above regulatory capital requirements. Cash and term deposits rose to $50.8 million from $38.8 million a year earlier. The group’s dividend yield was reported at 9.92%, with the final 10-cent dividend payable on September 18, 2026.
