Perpetual’s FY25 Impairment Totals $153.7M, Mostly from J O Hambro Goodwill
Perpetual Limited is set to record a significant $153.7 million non-cash impairment for FY25, largely driven by challenges in its J O Hambro boutique. This move underscores ongoing asset outflows but leaves liquidity intact.
- Non-cash impairment charge of approximately $153.7 million post-tax for FY25
- Majority of impairment linked to goodwill and customer contracts in J O Hambro boutique
- Continued net outflows in J O Hambro strategies throughout FY25
- Impairment affects statutory results but not liquidity or banking covenant compliance
- Audit process pending final confirmation of impairment figures
Perpetual’s FY25 Impairment Announcement
Perpetual Limited (ASX – PPT) has revealed it will record a substantial non-cash impairment charge of approximately $153.7 million post-tax for the financial year ended 30 June 2025. This figure, subject to final audit confirmation, primarily reflects a reassessment of the carrying value of goodwill and customer contracts within its J O Hambro boutique, part of the broader Asset Management division.
Challenges in J O Hambro Boutique
The impairment stems from persistent net outflows in key J O Hambro investment strategies, which have underperformed expectations throughout FY25. These outflows have eroded the value attributed to intangible assets such as goodwill and client contracts, prompting the write-down. The additional impairment charge of $128.2 million recorded in the second half of the year highlights the intensifying pressure on this boutique’s asset base.
Broader Impact and Financial Health
While the impairment will weigh on Perpetual’s statutory earnings for FY25, the company has reassured investors that it remains compliant with all banking covenants and that its liquidity position is unaffected. This suggests that despite the accounting hit, Perpetual’s operational and financial foundations remain stable, allowing it to navigate these asset management headwinds without immediate financial distress.
Strategic Implications
The write-down raises questions about the future trajectory of the J O Hambro boutique within Perpetual’s multi-boutique asset management model. Continued client outflows could prompt strategic reviews or restructuring to arrest value erosion. Investors will be watching closely for management’s next moves and any updates in forthcoming financial disclosures.
Looking Ahead
As Perpetual finalises its FY25 results, the market will be keen to see how the impairment influences broader group performance and whether the company can reverse the outflow trend in J O Hambro. The coming months will be critical for assessing the resilience of Perpetual’s diversified asset management portfolio amid evolving market conditions.
Bottom Line?
Perpetual’s sizeable impairment flags challenges ahead but leaves liquidity intact, next steps will reveal if strategy shifts can restore value.
Questions in the middle?
- What specific factors are driving continued net outflows in J O Hambro strategies?
- Will Perpetual consider restructuring or strategic changes to the J O Hambro boutique?
- How might this impairment affect investor confidence and Perpetual’s share price trajectory?
