Milford Funds Reports Significant Profit Surge Thanks to Performance Fees

Highlights:

• Profit Surge: Milford Funds reported a 72.1% increase in net profit to NZ$19.5 million, driven by NZ$83.5 million in performance fees.
• Charitable Contributions: Donations to the Milford Foundation rose to NZ$659,299, with an additional NZ$573,956 in goods and services donated.
• KiwiSaver Fund Performance: Long-term returns remained strong, with the growth, balanced, and conservative funds leading their categories over the past decade.

Impressive Financial Growth

Milford Funds (NZX: MFL) experienced a notable financial uplift for the year ending March 31, primarily driven by performance fees. The annual report revealed a 72.1% increase in net profit, reaching NZ$19.5 million. Management fees also saw an 18.7% rise, totaling NZ$185.7 million, while performance fees contributed NZ$83.5 million, a stark contrast to the previous year’s absence of such fees. The last instance of performance fees was in the year ending March 2022, amounting to NZ$26.4 million, significantly lower than this year's figure.

Dividend and Charitable Contributions

Despite the profit surge, Milford Funds paid out NZ$10.2 million in dividends, down from NZ$11.2 million the previous year. However, the company increased its charitable contributions to the Milford Foundation, donating NZ$659,299, compared to NZ$359,913 the prior year. Additionally, donations in goods and services amounted to NZ$573,956, slightly less than the NZ$618,640 donated last year.

Private Wealth Performance

Milford Private Wealth also had a successful year, with a 6.2% increase in net profit, totaling just over NZ$2 million. Dividends paid by this division rose to NZ$1.7 million, up from NZ$1.5 million the previous year.

KiwiSaver Fund Performance

According to MJW's survey, Milford's KiwiSaver funds delivered strong long-term returns over the past decade. The growth, balanced, and conservative funds led their respective categories with annual returns of 10.4%, 8.4%, and 5.8%. However, their performance in the near term was less impressive. The growth fund ranked fifth out of 15 for the March quarter and fourth for the year. The balanced fund was tenth out of 17 for the quarter and twelfth for the year, while the conservative fund ranked sixth out of 18 for the quarter and eighth for the year.

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