MFG profit falls 47% as Barrenjoey lifts combined earnings

Magellan Financial Group's (MFG) statutory net profit has fallen 47% to $88 million in FY26, despite stronger earnings from Barrenjoey helping lift the combined group's operating profit.

MFG reported a 9% decline in operating profit after tax to $145 million, as management revenue fell 13% amid continued outflows from its heritage Global Equities funds.

The result was partly offset by a substantial increase in partnership income, including MFG's $42 million share of Barrenjoey's earnings.

MFG's asset under management fell 7% over the year to $36.7 billion, with institutional inflows into Australian equities and global listed infrastructure strategies, alongside growth in systematic strategies, offset by continued Global Equities outflows.

Statutory NPAT was also affected by a $38 million fair value on MFG's fund investments and $11 million in merger and integration expenses.

The results mark the first reporting period following MFG's merger with Barrenjoey, which has created a more diversified financial markets, corporate finance and investment management business.

On a pro forma basis, including both businesses for the full year, the combined group generated $778 million in revenue and $215 million in operating profit after tax.

Barrenjoey's operating profit increased 68% to $112 million, more than offsetting the decline in MFG's operating earnings.

Combined group pro forma NPAT was $146 million, although this included non-recurring and non-cash items including fair value movements on shareholder funds, legacy Barrenjoey share plan amortisation and merger-related costs.

MFG declared a fully franked final dividend of 25.5 cents per share, representing 80% payout ratio based on the combined businesses' operating profit after tax.

MFG chief executive David Benari described FY26 as a "transformational year" for the group.

"The merger between MFG and Barrenjoey marks the beginning of a new chapter of our company," Benari said.

"The combined group deliver pro forma revenue of $778 million for the year and maintains a balance sheet with meaningful headroom for growth."

Subject to shareholder approval, MFG intends to change its name to Barrenjoey Group Limited and its ASX ticker to BJY, with Benari pointing to the group's planned New Zealand expansion as part of tis broader growth strategy.