Income Asset Management Posts 22% Revenue Growth and $2.4bn Funds Under Advice
Income Asset Management Group reported a robust FY2025 with significant revenue and client growth, alongside strategic cost reductions and a new product launch planned for FY26.
- 22% year-on-year revenue increase to $17.15 million
- Wholesale client base expands by 23% to 2,640 clients
- Funds under advice grow 27% to $2.4 billion
- Operating expenses reduced by 8% through a $4 million cost-out initiative
- Launch of managed accounts planned for FY26 to boost recurring revenue
Strong Financial Performance and Client Growth
Income Asset Management Group Limited (ASX – IAM) has delivered a compelling FY2025 result, highlighted by a 22% increase in revenue to $17.15 million and a 23% rise in wholesale client numbers to 2,640. This growth reflects the firm’s expanding footprint in Australia’s debt capital markets, particularly in bond and loan investments where funds under advice surged 27% to $2.4 billion.
The company’s fourth quarter was especially notable, with revenue reaching $5.4 million, driven by increased turnover and funds under advice. This momentum underscores IAM’s ability to attract and retain wholesale investors seeking direct exposure to debt instruments, a niche that continues to gain traction amid evolving market dynamics.
Operational Efficiency and Capital Management
IAM’s operational discipline is evident in an 8% reduction in operating expenses, achieved through a targeted $4 million cost-out initiative. This efficiency gain, combined with a successful $18 million equity raise and full repayment of $10 million in debt, has strengthened the company’s balance sheet and reduced annualised interest expenses by $1.2 million.
Strategically, IAM outsourced its custody and administration functions to Perpetual Corporate Trust (PCT), transforming what was previously a cost centre into a sustainable revenue stream through newly introduced custody and administration fees. Additionally, the sale of its deposit broking business to PCT signals a focus on core competencies and streamlining operations.
Looking Ahead – Managed Accounts and Revenue Diversification
CEO Jon Lechte highlighted the firm’s competitive edge in distributing bank-syndicated loan transactions, which offer investors risk alignment benefits by ranking equally with major banks in credit stress scenarios. Building on this foundation, IAM plans to launch managed accounts in FY26, including an investment-grade bond managed account and a multi-asset discretionary managed account (MDA) blending bonds and bank-syndicated loans.
These new products aim to deliver targeted returns of BBSW plus 300-350 basis points net of fees, while enhancing recurring revenue streams. This initiative complements the revenue generated from custody services and positions IAM to deepen client engagement and diversify its income base.
Overall, FY2025 marks a year of solid growth, operational refinement, and strategic repositioning for Income Asset Management, setting the stage for an ambitious FY26 focused on product innovation and sustainable profitability.
Bottom Line?
IAM’s FY2025 results lay a strong foundation, but the market will watch closely as managed accounts roll out and new revenue streams mature.
Questions in the middle?
- How will the launch of managed accounts impact IAM’s revenue mix and profitability in FY26?
- What are the long-term implications of outsourcing custody and selling the deposit broking business on client retention and service quality?
- Can IAM sustain its cost reductions while scaling its funds under advice and client base?
