Impax's AUM fall hits H1 results...
...but investment returns have been strong YTD. And it has deep expertise in energy efficiency, energy security, renewable energy & critical infrastructure. On the cusp of a return to net inflows?
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In April, Impax reported AUM had fallen 14% over its H126 to £22.3bn. This coincided with a period of very heavy outflows for equity funds generally, and for active and sustainable funds especially. So, the consequential hit to results is no surprise. Revenue fell 10% from the prior six-month period (H225) to £58.8m, and adjusted operating profit was down 45% y-o-y to £11.3m.
My detailed Equity Development research note covering the results can be read here.
I’ve argued for a while that this is a quality, highly differentiated asset manager. But its investment strategies have lagged ‘mag-7’ dominated indexes for some time, and it has been hard hit by outflows. The share price has been absolutely hammered.
If/when it does return to consistent net inflows, I reckon there’s a chance of a significant re-rating. But is this close?
There are positive signs. Most significantly, 70% of its AUM (especially its thematic strategies) outperformed benchmark year-to-date, and strong investment outperformance tends to lead net flows. We’ve seen this with other UK-listed active managers.
While the general environment for active managers’ flows has been very weak, flows are certainly not a one-way street towards passive. There are pockets of activity where investors have been deploying capital to actively managed strategies. Areas which have seen net inflows include:
Technology equities, which naturally have a US bias, with Polar Capital a major beneficiary;
Systematic equities, with Jupiter (in the last few quarters) and Man Group (throughout 2025) benefiting;
Global equities, which again have a US bias, with Jupiter a beneficiary;
EM fixed income, with Ashmore enjoying strong flows in Q4-25.
Could this trend flip in Impax’s favour?
Its recent investment outperformance gives it a good start.
But perhaps more significant is how the changing geopolitical landscape is changing the investment landscape. With a strong likelihood of prolonged geopolitical uncertainty and disruptions to energy markets in particular, investors will surely seek out active managers which are well positioned to navigate this environment.
And Impax has deep investment expertise and product offerings in areas such as energy efficiency, energy security, renewable energy, critical infrastructure (including energy, water, and digital infrastructure) and environmental risk. Here’s a slide from their presentation deck showing some of its focus areas.
This positioning should surely put it high on any investors’ radar?
Read more about Impax and its market environment in my research note here.
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Disclosure: At the time of writing, Paul Bryant was a shareholder of Impax and covers Impax as an analyst on behalf of Equity Development Limited. Read Equity Development’s research on Impax here. And please read this link for the terms and conditions of reading Equity Development’s research.