TIP Faces Earnings Pressure as Funds Management Fees Plunge 98%
Teaminvest Private Group reported a robust operating cash flow of $4.1 million in 1H26, driving strong investment activity and shareholder returns despite a decline in performance fees. The company’s active portfolio growth and increased cash reserves position it well for future expansion.
- Operating cash flow of $4.1 million with 272% cash conversion
- Statutory NPAT declined to $1.5 million due to lower Funds Management fees
- Active portfolio revenue up 6%, EBITDA up 15%, MOIC increased to 3.1x
- Declared fully-franked interim dividend of 1.55 cents per share
- Year-end cash balance rose to $9.8 million, with $4.6 million invested in growth
Strong Cash Flow Amidst Market Headwinds
Teaminvest Private Group (TIP) has delivered a compelling first half of fiscal 2026, reporting operating cash flow of $4.1 million, which translates to an impressive 272% cash conversion relative to statutory net profit after tax (NPAT) of $1.5 million. This robust cash generation underscores the company’s operational strength, even as statutory NPAT declined from $2.5 million in the prior corresponding period, primarily due to a significant drop in performance fees within its Funds Management segment.
Portfolio Performance and Investment Activity
The company’s active portfolio continues to be a bright spot, with look-through revenue rising 6% to $79.2 million and EBITDA surging 15% to $7.1 million. Notably, the Money on Invested Capital (MOIC) metric climbed to 3.1 times, reflecting strong returns despite increased capital deployment. Meanwhile, the passive portfolio expanded by 54% to $18 million, signalling TIP’s strategic diversification and growth in less active investments.
TIP reinvested $4.6 million during the half, including $0.9 million in growth capital expenditure aimed at expanding existing portfolio companies such as ECT, where $0.7 million was allocated for new vehicles and equipment. Additionally, $3.1 million was directed towards new investments in listed securities and managed funds, demonstrating the company’s commitment to compounding wealth through both organic growth and strategic acquisitions.
Shareholder Returns and Balance Sheet Strength
Despite the dip in Funds Management performance fees, down 98% year-on-year to $0.1 million, TIP maintained a shareholder-friendly approach by declaring a fully-franked interim dividend of 1.55 cents per share and continuing its on-market share buy-back, investing $0.3 million in the latter. The company’s net assets now stand at $86.5 million, or $3.21 per share, while cash and liquid investments increased to $14.4 million by the end of the half, up from $5.2 million in the prior corresponding period.
CEO Andrew Coleman highlighted that TIP’s strong cash flow and liquid balance sheet provide a solid foundation for ongoing growth and investment opportunities. The company’s ability to generate cash and deploy capital efficiently will be critical as it navigates the evolving market environment and seeks to deliver compounding returns to shareholders.
Bottom Line?
TIP’s strong cash flow and strategic investments set the stage for sustained growth despite near-term fee pressures.
Questions in the middle?
- How will TIP’s Funds Management fees recover amid volatile equity markets?
- What impact will continued share buy-backs have on TIP’s capital structure and earnings per share?
- Which portfolio companies beyond ECT are poised to drive future growth?
