IFM Investors, a Sydney-based manager of infrastructure and other private and public assets, reported record net inflows of A$22 billion ($15.2 billion) and record assets under management of A$140.4 billion for the firm's latest fiscal year ended June 30.
CEO Brett Himbury said in a press conference Monday that the firm's growing scale and "unique" ownership by 27 Australian industry superannuation funds should leave IFM well positioned to thrive in an increasingly challenging environment for the industry.
During the fiscal year, IFM's book of business became increasingly global, Mr. Himbury said. While the "vast majority" of the firm's record A$22 billion in fiscal year inflows came from Australian clients, a big portion of that — A$9 billion — was for cash mandates. The firm's A$13 billion in non-cash inflows — up from A$12.9 billion the year before — were split evenly among clients in Australia, North America, and the U.K. and Europe.
As of June 30, IFM was managing A$57.9 billion in infrastructure assets; A$37.4 billion in listed equities; A$28.5 billion in cash; A$14.8 billion in debt investments; and A$1.8 billion in private equity.
The ranks of IFM's clients, meanwhile, grew to 396 institutional investors in 22 countries as of June 30, up from 312 and 19 countries, the year before.
The firm's "normalized profit" for the latest year came to A$114 million, for a profit margin of 21%, up from A$83 million the year before.
Mr. Himbury said in the news conference that the continued consolidation of Australia's superannuation industry points to the likelihood of a smaller number of larger, more sophisticated clients in the future.
"What that means for fund managers like us and our competitors will be ... less money going to less managers at less margins ... unless you're aligned with the interests of asset owners, unless you offer value for money and unless you can demonstrate a strong performance track record," he said.
Margin pressure, in turn, could lead to a consolidation of fund managers in Australia — which would be "a massive opportunity for IFM," Mr. Himbury said, even as he noted his firm would be more inclined to add investment talent than risk the cultural challenges attending an acquisition.
Mr. Himbury said with more institutional money seeking opportunities in infrastructure and private assets, a fund management firm's ability to generate and pursue its own deals — as opposed to focusing on public auctions — will be one key to thriving in coming years.
Mr. Himbury said he remains optimistic IFM will be able to "self-generate" enough deals to prevent the firm's margins from being overly squeezed.