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    EQT
    Earnings call· Jun 2025(FY25)

    EQT Corp EQT

    Aug 21, 2025 Source

    Executive summary

    EQT Holdings Limited FY25 — Strong Financial Performance and Strategic Project Completion

    EQT Holdings delivered a strong FY25, marked by significant growth in key financial metrics and the successful completion of a three-year strategic project agenda, including the full integration of AET and technology platform modernization. The company is transitioning to focus solely on statutory profit performance, which has now reverted to underlying results. While facing increased regulatory scrutiny and some operational cost pressures, EQT is well-positioned to capitalize on market trends and inorganic opportunities, with a positive outlook for FY26 driven by its Corporate Trustee Services segment.

    Highlights

    5

    • Net profit after tax (NPAT) increased by 60% to $33.2 million.

    • Funds Under Management, Administration, and Supervision (FUMAS) grew to $254 billion, up 28% year-over-year.

    • Revenue grew by 7% to $182.5 million.

    • Earnings per share (EPS) grew by 60% to $1.2426 per share.

    • Total dividend for the year increased by 7% to $1.11 per share, with a second half dividend of $0.56.

    Concerns

    5

    • Operating expenses increased by 8.3%, exceeding the revenue growth rate.

    • Underlying net profit before tax margin softened by 80 basis points to 29.5%.

    • Client satisfaction saw a slight decline, attributed to significant client transitions to the new NavOne platform.

    • The company had exposure to the Shield and First Guardian Master Funds, with less than one-quarter of the reported $1.1 billion total investments in those schemes.

    • The vacancy rate at June 30, 2025, increased slightly to 3.9% from 2.6% in the prior year.

    Guidance & targets

    6
    CategoryTargetConfidence
    Technology Operating Expenses
    $2 million
    medium materiality
    High
    Trustee Wealth Services (TWS) Growth
    more moderate levels of growth
    medium materiality
    Medium
    Corporate Trustee Services (CSTS) Outlook
    really positive outlook
    high materiality
    High
    Effective Tax Rate
    around 30%
    medium materiality
    High
    Operational Risk Financial Reserves (ORFR) Facilities
    increase by a further $50 million
    medium materiality
    High
    Headcount in CSTS
    headcount increases in that business in particular
    medium materiality
    High

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Trustee Wealth Services (TWS)
    Revenue growth was impacted by the exit of the AET platform business and one-off state management fees, offset by AET synergies and new business. Operating expenses increased due to HUB24 fees and technology costs, despite reduced people costs from restructuring. The segment experienced a slight profit decline and margin compression year-over-year, but saw strong margin improvement in the second half due to cost base reduction.
    Revenue growth: $3.1 millionPrior year nonrecurring revenue reduction: $3.5 millionAET synergies revenue growth: $6.6 millionNew business revenue: $2.3 millionInvestment market improvements impact: $4.6 millionLost business impact: $2.1 millionOperating expenses increase: 5.3% or $3.7 millionHUB24 custody fees increase: $2.7 millionPeople costs reduction: $1.7 millionTechnology costs increase: $1.0 millionProfit decline YoY: $0.6 millionMargin compression YoY: 1.5%H2 FY25 NPT margin increase from H1: 3.9%
    		$99.6M3.1%—30.8% (H2 FY25 NPT margin)
    Corporate Trustee Services (CSTS)
    Achieved strong revenue growth driven by new business, additional funds into existing schemes, positive investment markets, and regulatory project revenue. Expenses increased due to additional headcount and allocated corporate technology costs. Despite margin softening slightly, the segment demonstrated significant FUMAS growth and strong new business activity, including major IPOs.
    Revenue growth: $8.5 millionNew schemes established/appointments: 53Offer facilities value increase revenue: $1.1 millionNew business/additional funds revenue: $7 millionMarket impact revenue: $3 millionSuper regulatory project revenue: $1 millionClosed/lost business decline: $3 millionExpenses increase: 12.4% or $6.2 millionFUMAS growth: ~30%Margin softened: 40 bps
    		$79.5M11.9%—30% (margin)
    Superannuation
    Revenue increased by 8% despite the merger of three funds. The segment onboarded four new funds, adding $6.7 billion in FUMAS, reinforcing its position as a leading independent superannuation trustee. Regulatory activity is driving higher compliance demands, reinforcing the segment's essential role.
    New funds onboarded: 4FUMAS from new funds: $6.7 billionMerged funds: 3ORFR facilities contribution to revenue growth: ~$1 million
    		—8%——

    Operational metrics

    26
    Underlying Net Profit Before Tax
    $53.7 millionup 4.1%
    FY25

    Primarily driven by CSTS' profit growth.

    Underlying EBITDA Margin
    34.4%increased from 26.6%
    H2 FY25

    Increased in the second half of FY25.

    Statutory EBITDA Margin
    35.2%increased from 31.3%
    H2 FY25

    Increased in the second half of FY25.

    Nonoperating Expenses
    $4.9 milliondeclined by $6.6 million
    FY25

    Due to the wind down of AET integration and technology deployment activity.

    After-Tax Profit Impact of Discontinued CTS-EU Business
    $0.7 million loss
    FY25

    The U.K. business was deregistered and is in final stages of liquidation.

    Effective Tax Rate
    30.4%reduction from 32% in FY24
    FY25

    Due to the decline in EU losses and non-deductible project costs.

    Operating Expenses
    $9.8 millionincreased by 8.3%
    FY25

    Increased due to various transition issues.

    People Costs (Net Increase)
    $2.9 million
    FY25

    Net effect of additional resources in CSTS, annual remuneration review, and reduction in TWS staff costs due to AET integration.

    Technology Operating Costs
    $2 million
    FY25

    Due to cloud migration, Workday/Salesforce/NavOne licenses, and cybersecurity services.

    Finance Costs
    $1 million
    FY25

    Due to increased value of the offer facility, which is recovered by revenue.

    Outsourcing Costs
    $2.9 million
    FY25

    As transition of custody and fund administration services to HUB24 was completed.

    Employee Count (TWS)
    reduced by 53decrease of 20%
    H1 FY25

    Result of the change to a single operating environment supported by NavOne.

    Employee Count (CSTS)
    increased by 13
    FY25

    To support the growth in the portfolio.

    Vacancy Rate
    3.9%slight increase on 2.6% prior year
    June 30, 2025

    Considered within normal range.

    AET Synergies Realized
    $7 million
    FY25

    Exceeded planned synergies relating to the AET acquisition.

    Funds Under Management, Administration and Supervision (FUMAS)
    $254 billionup 28%
    FY25

    Driven by growth in CSTS through new appointments and existing portfolio growth.

    Charitable Grants Made
    $170 milliondown on FY24
    FY25

    Lower than prior year due to lower dividend income in Australian equity market.

    Net Cash from Investing Activities
    $3 million
    FY25

    Due to reduced capital expenditure.

    Cash Outflows (Corporate Movements)
    $40 millionincreased by $21 million
    FY25

    Includes increased dividend payments and repayment of a facility.

    Total Equity
    $404 millionincreased nearly $5 million
    FY25

    Balance sheet remains investment grade.

    Gearing
    10.4%reduced
    FY25

    Balance sheet remains investment grade.

    Operational Risk Financial Reserves (ORFR) Facilities
    $15 millionincreased by $15 million
    FY25

    Represented as an equal and offsetting asset, cash, and liability line.

    Trade Receivables and Accrued Income
    reduced by nearly $4 million
    FY25

    Due to improvements in invoice processes and collections activity.

    Corporate Borrowings
    reduced by $5 million
    FY25

    Due to a part repayment of a facility.

    Total Shareholder Return
    9.7%
    June 30, 2025

    As of the end of the fiscal year.

    Dividend Per Share
    $1.11increased by 7%
    FY25

    Total dividend for the year, with a second half dividend of $0.56.

    Industry KPIs

    2
    MetricValueDetails
    Payout ratio89%%
    Pretax margin29.5%%

    Risks & headwinds

    5
    Regulatory Developments and Compliance DemandsOngoing

    Introduction of Financial Accountability Regime (FAR) in March and strengthened superannuation Prudential Standard CPS 230 (operational risk management) starting June 30, 2025.

    Mitigation: Continued investment to meet standards and expectations, aiming to maintain margins; active engagement in shaping future regulation.

    Negative Title Trust for Noongar CommunityOngoing

    WA Ombudsman's report tabled in Parliament; company disagrees with findings.

    Mitigation: Released ASX statement disagreeing with findings, will respond in due course; committed to purpose of the trust; ACNC did not reach same conclusions.

    Exposure to Shield and First Guardian Master FundsNext 12 months (expected distribution from Shield Master Fund)

    Exposure was less than 1/4 of the reported $1.1 billion total investments in those two schemes. Members' benefits likely to be negatively impacted.

    Mitigation: Engaging with regulators and industry for collective action; ceased accepting applications from Venture advisors in late 2023 and reported to ASIC; cooperating fully with inquiries; aiming for best possible member outcomes.

    Geopolitical UncertaintyFY26

    Exposure through movements in investment markets.

    Mitigation: Business plans and pipeline of new business, particularly in CSTS, are expected to provide a positive outlook.

    Client Satisfaction DeclineFY26

    Slight decline in client satisfaction, though healthy Net Promoter and Loyalty Scores maintained.

    Mitigation: Attributed to significant client transitions to the new NavOne platform; expect results to improve in FY26 with the platform embedded.

    What to watch next

    5

    Capital Review Update

    H1 FY26
    CurrentUnderway
    TargetFurther update at the half year

    Why it matters

    This review will determine the best use of capital and leverage position for the company's new strategic plan horizon, impacting future capital allocation decisions.

    In capital review, we're obviously just taking the time after we enter a new 3- to 5-year strategic plan horizon around the best use of capital and our leverage position. So we'll provide a further update at the half year.

    Q&A highlights

    7

    Where does EQT place blame for the Shield Master Trust failure, and does the company need to alter its processes in response?

    EQT stated it's not their role to assign blame, but they are confident regulators are thoroughly investigating and they are engaging productively. They believe they have abided by all requirements of the SIS Act and Corporations Act.

    “Look, it's not for us to direct blame. We're confident the matter is being thoroughly investigated by the regulators, and they are making good inroads, and we are engaging with them productively and that is our focus.”

    asked by Unknown Analyst · answered by Michael O’Brien

    2 min read6 chapters

    Detailed Narrative

    01

    FY25 Financial Performance Highlights

    EQT Holdings reported a strong FY25, with net profit after tax (NPAT) surging 60% to $33.2 million, driven by underlying profit growth and reduced non-operating expenses. Funds Under Management, Administration, and Supervision (FUMAS) reached a record $254 billion, marking a 28% increase year-over-year. Revenue grew 7% to $182.5 million, while earnings per share (EPS) mirrored NPAT growth, rising 60% to $1.2426. The Board declared a total dividend of $1.11 per share, up 7% from the prior year.

    02

    Strategic Project Completion and Technology Modernization

    The company successfully concluded its three-year strategic project agenda, which included the full integration of AET, realizing $7 million in synergies, exceeding planned targets. Key technology initiatives delivered were the new NavOne trustee platform for Trustee Wealth Services (TWS), Workday for human capital management and finance, and migration of technology infrastructure to the cloud with upgraded cybersecurity. This completion marks a shift to a more focused technology investment strategy for FY26, primarily targeting Corporate Trustee Services (CSTS).

    03

    Segment Performance Overview

    Trustee Wealth Services (TWS) saw revenue growth of just over 3% in FY25, reflecting the exit of the AET platform business and some one-off📎 items, with second-half profit margins improving to 30.8%. Corporate Trustee Services (CSTS) continued its strong momentum, establishing 53 new schemes and contributing $8.5 million or 11.9% to revenue growth, with FUMAS growth around 30%. The Superannuation business increased revenue by 8%, onboarding four new funds totaling $6.7 billion in FUMAS, despite merging three other funds.

    04

    Regulatory Landscape and Operational Risk Management

    EQT managed a significant volume of regulatory changes, including the introduction of the Financial Accountability Regime (FAR) and the strengthened superannuation Prudential Standard CPS 230 on operational risk management. The company addressed two well-documented issues: the negative title trust for the Noongar community, disagreeing with the WA Ombudsman's findings, and its limited exposure to the Shield and First Guardian Master Funds, where it identified irregularities and reported concerns to ASIC, cooperating fully with ongoing inquiries.

    05

    Capital Management and Balance Sheet Strength

    The balance sheet remains investment grade, with total equity increasing by nearly $5 million to $404 million and gearing reducing to 10.4%. Operating cash flows were broadly flat at $40 million, including $4 million in restructure payments. Cash outflows for corporate movements increased to $40 million, including a $5 million increase in dividend payments and a $5 million repayment of a facility. A capital review of allocation and leverage position is planned for the first half of FY26.

    06

    FY26 Outlook and Strategic Priorities

    For FY26, EQT anticipates a positive outlook, particularly for CSTS, driven by its strong pipeline. TWS is expected to experience more moderate growth, with new technology solutions boosting efficiency. The company will focus on leveraging market positions for growth, deploying digital solutions to enhance client experience, and actively engaging with regulatory demands. Technology operating expenses are forecast to normalize to $2 million, with investments concentrated on CSTS for workflow and data automation.

    AI-generated summary of the company’s earnings call. Not investment advice.