Milford Funds has reported its best-ever revenue bonanza over the 12 months to March 31 as fee income jumped more than 70 per cent year-on-year to reach almost $270 million.
The Auckland-headquartered firm booked performance fees of $83.5 million for the 12-month period after drawing a blank in this category last year while management fees rose to just under $186 million ($156.5 million in the 2022/23 financial year).
Including interest of about $2 million total Milford gross income reached above $271 million for the year.
Profit almost doubled to $19.5 million from $11.3 million in the previous reporting period but costs also soared to $244 million compared to around $142 million last year.
Most of the costs at the $20 billion fund manager were attributed to ‘management service fees’ – the catch-all line that bundles up most operational expenses such as staff pay incurred by parent entity, Milford Asset Management.
“Key management personnel are remunerated by the Parent Company, and a portion of their remuneration which relates to their services to the Company is recharged as part of the management services fee,” the Milford Funds report says. “It is not possible to separately identify the amount of key management personnel’s compensation within the total management services fees of $227,427,277 (2023: $126,700,079).”
Despite the profit boost, Milford Funds paid a slightly lower dividend for the latest reporting period of $10.2 million, or $102,000 per share, versus $11.2 million and $112,000, respectively, in the previous year.
The most recent result caps off a remarkable decade of growth for the manager with gross fee revenue up about eight-times compared to the 2014 financial year.
Milford topped $20 billion under management in 2024, about 17 years after launching its retail funds business, adding a KiwiSaver scheme in 2010.
The group moved into the Australian market in 2017 where it currently manages about A$730 million among five funds.
Meanwhile, Fisher Funds, which typically rivals Milford in annual fee revenue has yet to report full company results but the manager has accrued more than $134 million in management fees across its three KiwiSaver schemes over the 2023/24 year .
Last week Fisher also unveiled as shake-up in its leadership team under new chief, Simon Power, with three senior staff to exit, a couple of reassignments and one fresh executive due aboard.
Marcus Wild, Fisher marketing chief, and head of partnerships and distribution, Sharon Mackay, will leave by year-end with their responsibilities to be folded into the chief client officer “portfolio”, according to a spokesperson.
Wild joined the firm in 2017 from business directory operator, Yellow, while Mackay shifted to Fisher in 2020 after almost nine years at BNZ wealth – ending her career there as head of strategy and product.
Long-time Fisher senior investment team member, Angela Quirk, will also leave the Takapuna-based manager in “a few weeks”, the spokesperson said. Quirk joined Fisher 10 years ago as a fixed income manager before rising to her current role as head of trading and portfolio management in 2015.
Meanwhile, both Nilesh Mistry and Jody Kaye have been shifted into different executive positions in the Power reshuffle.
Mistry moves from chief operating officer (COO) to the chief client officer spot; Kaye, a seven-year Fisher veteran previously in charge of the Kiwi Wealth integration is now chief product and group strategy officer – he initially joined the business as chief financial officer from Harbour Asset Management.
According to a statement, Kaye has been “tasked with evolving the Fisher Funds’ client offering across KiwiSaver and Wealth Management and driving strategic initiatives across the business”.
Finally, current chief technology officer at accounting firm BDO NZ, Chynel James, is slated to take on the Fisher COO gig in October.
Power a one-time National Party government minister replaced Bruce McLachlan as Fisher chief in February this year, inheriting a roughly $24 billion behemoth in the throes of digesting its $310 million purchase of Kiwi Wealth – the latest in a long line of acquisitions.
Fisher is now the second-largest KiwiSaver provider with about $16.7 billion under management across the three schemes as at the end of March.
US private equity firm, TA Associates, is reportedly looking to offload its one-third share in Fisher: Taranaki community trust, Toi Foundation, owns the remaining two-thirds of the company.