HMC Capital has reported a record FY25 with pre-tax operating earnings soaring 74% and EPS up 51%, driven by strong asset growth and diversified platform success. The company sets a confident FY26 outlook targeting sustained organic growth and stable dividends.
- Pre-tax operating earnings of $224.6 million, up 74% year-on-year
- Pre-tax operating EPS growth of 51% to 56.0 cents
- Assets under management increased 47% to $18.7 billion
- Strong returns from private equity and growth in private credit AUM
- Acquisition of Neoen’s Victorian renewable portfolio to boost energy transition platform
Record Financial Performance
HMC Capital has delivered a landmark financial year for FY25, reporting pre-tax operating earnings of $224.6 million, a striking 74% increase compared to the previous year. This translated into a 51% rise in pre-tax operating earnings per share (EPS) to 56.0 cents, underscoring the scalability and strength of its diversified alternative asset management platform.
The company’s assets under management (AUM) surged 47% to $18.7 billion, reflecting robust capital inflows and effective deployment across multiple asset classes. This growth was fuelled by strong performances in real estate, private equity, private credit, digital infrastructure, and energy transition sectors.
Operational Highlights Across Divisions
Within real estate, HMC fully deployed its $1 billion Last Mile Logistics Fund I and launched two new daily needs funds, HARP and HUG, attracting $180 million in new capital inflows and $400 million in seed equity commitments respectively. Fundraising for the HMC Urban Retail Fund is ongoing, with active due diligence from multiple parties.
The private equity division stood out with the HMCCP Fund I delivering an impressive 43.6% net return over FY25 and a 30% annualised return since inception, outperforming the S&P/ASX300 by a significant margin. Meanwhile, private credit assets grew by 21%, driven by commercial real estate lending and a burgeoning $3 billion deal pipeline focused on mid-market residential opportunities.
In digital infrastructure, the successful IPO of the DigiCo Infrastructure REIT and the progress of the SYD1 development project, expected to deliver 9MW of liquid-cooled IT capacity by late FY26, highlight HMC’s strategic positioning in this fast-growing sector.
Energy transition efforts were bolstered by the acquisition of Neoen’s Victorian renewable generation and storage portfolio, positioning HMC as a leading player in Australia’s renewable energy landscape. Plans to merge this portfolio with StorEnergy’s battery platforms aim to create a consolidated operating platform, supported by ongoing equity raising initiatives.
Looking Ahead to FY26
HMC’s management projects FY26 pre-tax earnings of at least 40 cents per share, driven by organic growth in recurring fund management earnings. Real estate and private credit divisions are expected to grow fund management EBITDA by 15% and 20% respectively, while private equity aims for a normalized 15% annual return. Digital infrastructure and energy transition platforms are anticipated to reach similar growth levels as they become fully operational.
The company plans to maintain its dividend at 12 cents per share, balancing shareholder returns with reinvestment into value-accretive growth opportunities. With a strong balance sheet featuring $2 billion in net tangible assets and undrawn debt, HMC is well-positioned to capitalize on market opportunities and scale its diversified platform further.
Bottom Line?
HMC Capital’s record FY25 sets a high bar, but FY26’s organic growth focus will test the durability of its momentum.
Questions in the middle?
- How will HMC manage risks associated with scaling newer divisions like digital infrastructure and energy transition?
- What impact will the Neoen Victorian portfolio acquisition have on HMC’s earnings and capital requirements?
- Can private equity returns sustain their outsized performance amid broader market volatility?