Insignia Financial Earnings: Greater Confidence in Earnings Stabilization

Insignia is delivering larger-than-expected cost savings, giving us greater confidence in long-term margins and driving a 6% increase in our fair value to AUD 3.60 per share. First-half fiscal 2024 underlying net profit after tax grew 1.2% from the previous corresponding period, beating the modest decline we had anticipated. Costouts are the main driver. The advice business turned EBITDA profitable, and corporate expenses were also considerably lower than expected. Slower fee compression in platforms and investment products also contributed. The annual cost/income ratio fell to 74.9%, below our prior forecast of 78.5%.