The HMC Capital Ltd (ASX: HMC) share price is galloping higher today. It appears expectations have been exceeded amid the release of the company's full-year results for FY22.
In afternoon trading, shares in the alternative asset manager are relishing in excitement. At present, the share price has improved by 9.15%, trading at $5.13. This is an exceptional outperformance of the S&P/ASX 200 Index (ASX: XJO), which is 0.53% ahead on Wednesday.
Let's take a closer look at the numbers.
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HMC Capital share price leaps on beastly year
- Assets under management (AUM) up 321% year on year to $5.8 billion
- Pre-tax funds from operations (FFO) up 143% to $91 million
- Funds management revenue up 490% to $64.1 million
- $4.6 billion of gross transactions in FY22
- Dividends per share (DPS) flat compared to FY21 at 12 cents
- Net assets of $846 million as at 30 June, up from $711 million
What else happened in FY22?
It was a monumental year for HMC Capital and its share price by all accounts. Possibly the most significant event during FY22 entailed the rebranding from Home Consortium to HMC Capital.
This was carried out to better reflect the company's ambitions of being an asset manager. As a result, the growing HomeCo brand is now a single facet of the company's owned assets. Alongside it is HealthCo and the HMC Capital Partners funds.
Another major event for HMC Capital during the financial period involved the acquisition of Aventus Group. Strengthening the HomeCo portfolio, the HomeCo Daily Needs REIT (ASX: HDN) grew to encompass 2.5 million square metres of land under the deal. The scheme was officially implemented on 4 March 2022.
Finally, the company launched its first fund dedicated to investing in public and private companies across Australia and New Zealand. Importantly, the focus is on companies with 'real asset backing'. Known as the HMC Capital Partners Fund I, the fund is targeting returns of greater than 15% per annum with a yield of 2% to 4%.
What did management say?
Commenting on the solid result, HMC managing director and CEO David Di Pilla stated:
As a manager we also demonstrated strong discipline and alignment through our proactive response to the rising interest rate environment and market volatility this year. We strengthened the capital position of our funds through opportunistic asset sales which took advantage of the disconnect between property and global capital markets.
Adding to this, Di Pilla highlighted the success of the partners' fund thus far. As an example, an investment recently made in Sigma Healthcare Ltd (ASX: SIG) has appreciated by 22%.
What's next?
Due to the unpredictability of transactional income, management was reserved with its forward guidance. However, the team did suggest that the 31 cents per share pre-tax FFO was repeatable. On top of that, DPS guidance was provided at 12 cents per share for FY23.
HMC Capital share price snapshot
There is a stark contrast between the HMC Capital share price and the figures posted today. Unlike the explosive increases in many operational metrics for FY22, the company's share price has been trending lower.
In 2022, shares in HMC Capital have fallen by nearly 36%. This means the company now holds a market capitalisation of $1.53 billion.
