Forecasts exceeded in FY23, strong start to FY24
In FY23, Tatton (once again) grew much faster than peers. AUM was up 12% y-o-y excluding acquisitions (peer group median: 0%) to £12.7bn on 31 Mar 23 (31 Mar 22: £11.3bn). Assets Under Influence (AUI) reached £13.8bn (including 8AM Global: 50% stake acquired in Aug 22). In just over two months post year-end, AUI has grown another 3% to £14.3bn.The bulk of growth in FY23 came from exceptionally strong net flows of +£1.8bn (FY22: +£1.3bn); 16% of opening AUM (FY22: 14%) compared to a peer group median of 4% (FY22: 6%). Tatton’s ability to attract and retain assets has been far above peers for some time now. It has clearly designed, and is delivering, an outstanding proposition to clients.
Tatton has exceeded our previous revenue and profitability forecasts for FY23 and we think its differentiated offering within a market sweet-spot (on-platform Model Portfolio Services growth rate: c25% p.a.) will fuel continued strong growth. We increase our FY24 forecasts: revenue from £35.0m to £35.9m; adjusted operating profit from £17.9m to £18.2m. Our fundamental valuation rises from 560p to 580p.
Tatton Asset Management is engaged in providing a range of services to the Financial Conduct Authority ("FCA") directly authorized financial adviser ("DA IFA") marketplace encompassing discretionary fund management, regulatory and compliance services and mortgage services. Co.'s discretionary portfolio management ("DFM") service operates on ten United Kingdom adviser WRAP platforms and can be integrated into the growing number of adviser WRAP platforms in the market. Co. provides support services to independent financial advisors ("IFA"s), enabling DA IFA firms to provide compliant and effective investment portfolio management for their platform based clients.
Equity Development enables companies to become better understood and supported by investors. Since our launch in 1996 we have consistently focused on helping our clients improve their communication and relationships with both existing and potential shareholders. Our clients have come from a wide variety of sectors and domiciles, are both private and quoted and range in size from micro-cap to $multi-billions. We offer free access to company research notes written by experienced analysts. These notes include detailed forecasts, financial models and a fair value. We host regular Private Investor Forums at which investors have the opportunity to hear company directors present, and to ask questions. These are free to attend. We broadcast live Webinars with company management that include active Q&A. We also make the recordings available online. We arrange face to face meetings between private investors and company management. We are active users of Twitter, commenting daily on company news, share price moves, Directors’ Dealings, Equity Development Research Notes & Events.
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