The IOOF Holdings Limited (ASX: IFL) share price has dropped by 5.88% at the time of writing, following a business update by the company for the fourth quarter of the 2020 financial year.
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What was in the announcement?
According to the announcement, IOOF's funds under management, advice and administration (FUMA) grew to $202.3 billion at 30 June, an increase of 3.4% during the fourth quarter of the 2020 financial year.
IOOF's financial advice business had net outflows of $93 million compared to outflows of $853 million in the prior corresponding period (pcp).
The company's portfolio and estate administration had net inflows of $398 million, excluding early release of superannuation, compared to inflows of $561 million on pcp.
IOOF's investment management business had a net outflow of $51 million, compared to $181 million on pcp. Its pension and investments business had net outflows of $183 million, excluding early release of super.
The company paid out $743 million in the early release of superannuation from 20 April to 30 June 2020.
Commenting on IOOF's FUMA result, CEO Renato Mota stated:
The Milestone of over $200 billion in FUMA is testament to IOOF's increased scale and the benefits of the diversification of our business. The transformative acquisition of the P&I business contributes to our business model resilience and will be important as we look to a post COVID-19 recovery and supporting long-term growth in FUMA and earnings.
The recent recovery in equity markets has been the major contributor to the $6.7 billion uplift in FUMA and pleasingly, we have continued to attract strong flows into our platforms. That said, the impacts of the COVID-19 pandemic are continuing. Our advisers are seeing first-hand client concern and uncertainty around macro-economic conditions. This client sentiment is particularly apparent through withdrawals associated with the Early Release of Superannuation scheme and subdued flows in Financial Advice.
IOOF expects to report underlying net profit after tax of around $128 million to $130 million for the 2020 financial year. Underlying net profit after tax from continuing operations is expected to be $123 million–$125 million.
About the IOOF share price
IOOF is an Australian financial services company with a history dating back to 1846. It offers superannuation, financial advice, investment management and trustee services.
In July, IOOF announced that a class action brought against the company in relation to a breach of superannuation directors duties was dropped, with no payment made to those bringing the claim.
The IOOF share price is up 82.35% since its 52-week low of $2.72, however, it is down 37% since the beginning of the year. The IOOF share price is down 15.01% since this time last year.
