GQG Partners has reported distributable earnings for the second half that slightly exceeded expectations, according to UBS analyst Shreyas Patel. The December-half distributable earnings reached $US241.2 million, surpassing both UBS’s and consensus forecasts by approximately 0.5 to 1.3 per cent. The quality of these earnings was particularly strong, benefiting from zero performance fees, robust management fee margins, and reduced operating costs. GQG Partners is a global investment firm focused on managing active equity portfolios. The company aims to deliver long-term value for clients through a combination of fundamental research and a focus on high-quality businesses.
Management fee margins saw a slight improvement, rising to 48.5 basis points during the period, up from 48.3 basis points in the first half. This improvement reflects a favourable investment mix with increased exposure to emerging markets. Patel noted that headcount remained relatively stable at 240 employees. Operating expenses were notably lower, coming in 10 per cent below anticipated levels. This reduction was attributed to decreased compensation expenses and general operational costs.
As of the beginning of February, GQG Partners had $US172.4 billion in funds under management, marking a 4 per cent increase since January. This growth was driven by positive market movements, although partially offset by estimated net outflows. Looking ahead, UBS anticipates that fiscal year 2026 performance fees may be revised downward due to investment underperformance. However, these potential reductions could be partially mitigated by the company’s lower operating costs. GQG Partners shares were recently up by approximately 7 per cent.
