Today Janus Henderson, a global fund manager, presented their Q422 and Full Year 2022 results, which were significantly ahead of market expectations.

Key Points:

  • Profits Flat: Q4 earnings per share at US$0.61 flat and higher than market expectations of US$0.41 with revenue US$73m above estimates. The market had expected a large fall in FUM that had not eventuated. Fund performance in fixed income, multi-asset and alternatives is very good with equities improving. A rebound in markets could see performance fees in 2023, which were absent in 2022.
  • FUM:  Funds under management of US$287 billion, increasing +5% over the quarter mainly due to market movements offsetting outflows.  Average net margin increased to 50.7bps from 49.5 bps, which was pleasing as outflows in lower margin quant funds being offset by inflows into higher margin alternatives and fixed income.
  • Dividends unchanged as expected: Quarterly dividends were flat at US$0.39 per share = 5.4% at AUD 0.70. This represents a meagre dividend payout ratio of only 63% given the company’s lack of debt and capital light business model. JHG is a very consistent dividend payer steadily increasing dividends since the merger in 2014 and consistently buying back stock every year. Though unfortunately the share buy backs have been done on the ASX rather than the NYSE listed stock, which is not great news of ASX-liquidity.
  • Strong balance sheet: JHG has a net cash position of US$1.21 billion, so no nasty calls from banks or issues about rising interest costs.

Janus Henderson is held in several of the HNW portfolios and whilst it is being stalked by activist fund Trian Partners which now holds 19% of JHG, JHG still looks cheap at a PE of 11.8 and a dividend yield of 5.4% and provides a quarterly dividend stream and exposure to a falling Aussie dollar.  We are anticipating there will be further interest in JHG this year including the potential for a takeover some time this year.

JHG finished up today 13% at 41.46