FY25 (to 31 Mar 25) was an exceptionally strong year which exceeded our previous forecasts. Revenue grew 23% to £45.3m (previous forecast £44.3m), adjusted operating profit 24% to £22.9m (£22.1m) and PBT 29% to £21.6m (£21.3m). Net cash was £32.1m at year-end with no debt. A final dividend of 9.5p is proposed. Full year dividend is 19.0p (yield 3.2%), +19% YOY.
Underpinning performance was sector-leading AUM growth, up 26% to £20.9bn (FY24: £16.6bn). This was in turn mostly a result of record organic net flows of £3.7bn (FY24: £2.3bn). Tatton’s net flow rate has been far higher than peers for some years now.
There are multiple market and Tatton-specific drivers which underpin prospects: savers and investors keep contributing to their investment and retirement pots; an ageing UK population demands more financial advice with more ‘adviser-led’ investments (Tatton’s channel); and advisers continue to outsource investment management to focus on financial planning and advice. Indeed, on-platform discretionary fund management FUM increased 40% last year (longer term CAGR: 28%).
With a strong outlook, we adjust our FY26 forecasts upwards, along with our valuation which ticks up from 715p per share to 735p, 20% above the current share price.
