NZ Fund Managers

[Snoopy]

Milford Asset Management Ltd - topco - is the equivalent to Fisher Funds Management Limited - they are both the top entity and reflect the full consolidated view. Ideally we'd be comparing like for like. We have topco financials for fisher, not for milford, the later we just have a subsidiary. A subsidiary that probably generates the vast majority of its income. and probably its expenses. but we don't know what in milford topco. its possible the charges are just for IP and all the bums on seats and technology is in MFL,

According to this link https://www.dnb.com/business-directo...185d55a1e.html, Milford Funds Limited has 13 employees and generates $US119.39m in sales whereas Milford Asset Management Limited https://www.dnb.com/business-directo...9eda2ee61.html has 210 employees and generates $US11.59m in sales.

Since I have already figured out Milford's 'investment team' contains 33 people (post 2 in this thread), it would be odd to have close to half of that investment management team inside 'Milford Funds Limited' with the others inside 'Milford Asset Management Limited'. So I would guess that those 13 'Milford Funds Limited' employees are more likely clerical positions 'booking sales' by keeping note of investment funds as they roll in, while all the actual investing expertise is outsourced to the parent 'Milford Asset Management'.

and the management fee is a simple profit minimisation tool for PR purposes (thats what I expect). possible the consolidated group looks a whole like MFL npat adding back the after tax intercompany fees. but just speculation.

what do the npat figures % of revenue for milford funds ltd look like if you do that? probably look weird

Putting some numbers on your speculation:

1/ The 'Management Services Fee' for 'Milford Funds Limited' amounted to $136.594m.
2/ If MFL had not paid this fee and booked this cashflow as profit, then they would have had to pay tax on it, leaving the amount to be added to profit as: 0.72( $136.594) = $98.348m.
3/ This would have increased MFL NPAT to $11.725m + $98.348m = $110.073m.
4/ This implies a 'net profit margin' of $110.073m/$162.710m = 68% (!)

That figure makes the net profit margin salted away by the Fisher team sound 'fundholder friendly'. However, given the future profitability of MAL is not determined by clerical staff and cleaners, I am picking this 68% figure overstates the true profitability of Milford managed funds, as an operation.

SNOOPY