Wilson Group - strong earnings growth and potential capital return

Perpetual Equity Investment Company

Perpetual Asset Management (Australia)

In early July the Wilson Group completed the flagged sale of its securities business. Moving forward the company, through its interest in Pinnacle, is essentially a part-owner of a number of boutique fund managers. The 2015 results were very encouraging with aggregate FUM across the group up some 31% to $16.1bn. This led to Pinnacles share of equity accounted profits rising 42% to $11.9million. Pleasingly whilst markets contributed to the move, a number of boutiques also saw strong retail flows which in turn had positive margin impact. We believe this momentum will translate to continued strong earnings growth in to FY16 and over the medium term. With a simplified corporate structure, robust net cash balance sheet and significant franking balance, we feel Wilson Group is well placed to return capital to shareholders or alternatively lift the ongoing dividend payout given the capital light nature of the business.


Perpetual Asset Management (Australia)

The Perpetual Equity Investment Company Limited is an ASX listed investment company offering investors access to a portfolio of predominantly high quality Australian and global listed securities, selected by Perpetual Investment Management Limited.

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