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Investing.com -- Shares of Pollen Street surged by 5% following the release of a robust earnings report.
The company’s Fund management EBITDA saw a significant increase, coming in over 70% higher year-on-year (YoY) and 9% above consensus estimates. This financial uptick was driven by Fund management income, which rose 36% YoY and surpassed consensus at £66.8 million.
Pollen Street’s earnings per share (EPS) also exceeded expectations, reporting at 78.8 pence, which is 3% ahead of forecasts. The company’s net investment return saw a 5% increase YoY, reaching £31.8 million, aligning with consensus despite a decrease in investment assets due to an ongoing share buyback program.
The firm’s assets under management (AUM) experienced substantial growth, both quarterly and annually. Over the fourth quarter, AUM grew by 8%, and it saw a near 29% increase over the fiscal year 2024, reaching £5.4 billion. This growth was attributed to the successful fundraising for Private Equity V, which hit its €1 billion target, and capital deployment in Credit. Private Equity AUM jumped 35% to £3.5 billion, and Credit AUM rose 19% to £1.9 billion.
Fee-paying AUM also saw an increase, rising 17% to £4.0 billion and further to £4.3 billion in the first quarter of 2025. The company’s average fee-paying AUM over fiscal year 2024 grew by 25% YoY, which supported the 36% overall growth in Fund management income.
The income-driven EBITDA margin improved by 9 percentage points to 39%. Management fees climbed 62% YoY, with performance fees, despite being 24% lower YoY, aligning with long-term guidance. The increase in Fund management costs, primarily staff-related, did not hinder the expansion of the EBITDA margin.
Pollen Street’s net debt to tangible equity ratio improved, falling to 50% as of December 31, 2024, from 54% the previous year. The company’s strong cash generation and strategic investments in Pollen Street funds have contributed to this healthier balance sheet.
Looking forward, management has maintained its guidance and expressed confidence in the current strategic direction. They anticipate completing fundraising for Private Equity V and Private Credit IV over 2025 and aim to make progress toward targets set out at the fiscal year 2023 results.
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