Ladies and gentlemen, thank you for standing by. Welcome to the Pinnacle Investment Management Group Limited full year 2020 financial results teleconference. At this time, all participants are in a listen-only mode. Following the presentation, there will be a question and answer session. To ask a question, you'll just need to press star one on your telephone keypad. Just please be advised, today's call is being recorded. I will now hand the conference over to your first speaker today, Mr. Ian Macoun. Thank you. Please go ahead.
Good. Thanks, Miles, and welcome, and thanks to everyone on the call. We appreciate your time and your interest in PNI. As Miles said, this is the 2020 financial year full year results for PNI. The Pinnacle representatives on the call today are our Chair, Alan Watson, Andrew Chambers, who's an Executive Director with particular responsibilities for institutional, including offshore distribution, Dan Longan, our CFO, and myself, Ian Macoun, MD. You'll be welcome to direct questions to any of the four of us after I take you briefly through the presentation. Earlier this morning, we lodged with the ASX and on our website an announcement letter setting out the highlights of our financial results, an investor presentation, which is about 40 slides altogether, our annual report, which includes our remuneration report and audited financial statements and notes, and our Appendix 4E.
We've also lodged our corporate governance statement on our website. I hope that everyone on the call has access to these documents. I'll be referring mainly to the presentation. Slide one sets out some disclaimers that we invite you to read. On slide two, we have sought to summarize the main themes for the year as we see them. Now, obviously, it is for the analysts and shareholders out there to reach your own conclusions on our results. We thought we should share with you our own take on the year and how we see the condition of the company moving forward from here. We think our financial outcome was solid in the prevailing circumstances. We could use words such as reasonable or respectable.
We've chosen solid in the circumstances, although of course, they are below our expectations at the start of the year and even what we were expecting at the start of the second half. There was a lot of action, as everyone knows, in the second half. We are encouraged that the period of adversity demonstrated the benefits of our strategies that we've been pursuing for some time now of increasing our diversity. Increasing the diversity of asset classes and investment strategies of the affiliates, the diversity of our client types and domiciles, and the size and diversity of the performance fee potential of our affiliates, which came through nicely in the year. Now, we're only partway through this process of increasing diversification and therefore the resilience of our company. Indeed, we may never be finished that process, but it has produced valuable benefits already.
We believe we are entering the 2021 financial year poised to resume growth or able to react to any further external adversity that may come our way, as we did in the second half of 2020 financial year. Indeed, we stand ready to take advantage of any attractive opportunities that may materialize. That was it there on slide two, just sort of in a nutshell, a summary of how we see the year. Slide three sets out the financial highlights of the 2020 financial year. Net profit after tax was AUD 32.2 million, up 5.6% from AUD 30.5 million in the 2019 financial year. This translated into basic EPS of AUD 0.188 a share, up 2.7%, and diluted EPS of AUD 0.179, up 4.7%. Pinnacle share of the after-tax profit of affiliates was AUD 38.0 million, up 14.8% from 2019.
That includes AUD 6.6 million, which was our share of performance fees earned by affiliates in the 2020 financial year, compared with AUD 3.2 million in 2019. It also includes our share of Coolabah's after-tax profit, which is about six and a half months, since we acquired the stake in the middle of December 2019. We had cash and principal investments of AUD 50.1 million at 30th of June.
Our AUD 30 million CBA loan facility was fully drawn in December and used to fund the acquisition of a 25% interest in Coolabah, and we have declared a fully franked final dividend of AUD 0.085 per share, payable on the 11th of September. That takes the total dividends for the year to AUD 0.154, the same as in FY 2019. There are a couple of footnotes on this slide that I would like to draw your attention to. Footnote one in particular.
As I said earlier, it's for the analysts and the investors on this call to make their own decisions as to how to interpret our results. Of course, people are very welcome to simply look at the raw, unadjusted NPAT of AUD 32.2 million and say, "It's up just 5.6% on last year." That's a legitimate conclusion. I'd personally always adjust out the net return on our PIs to calculate an adjusted, or you might say some kind of underlying profit. Footnote one does that, and it shows that adjusting for the net return on principal investments, our NPAT, excluding the AUD 474,000 negative net return on PI that we incurred this year, it would've been AUD 32.7 million, which was up 17.6% on the equivalent adjusted NPAT of AUD 27.8 in 2019. Because in 2019, we actually had a positive net return of AUD 2.7 million.
I actually adjust for return on PI as not being, in effect, an operating result, and our result is better if you do that. I've always done that in the past when it made our result look less of an increase on the previous year as well. Some people like to treat performance fees as in some way abnormal, and footnote two shows that adjusting for our share of the performance fees of affiliates, our share of NPAT from affiliates would be AUD 31.4 million, up just 5% on the previous year. I personally don't make that adjustment at the current level of performance fees, which I don't believe is extraordinary. I don't make that adjustment given that 32% of our funds under management or AUD 18.9 billion now attracts performance fees, and we have diversified sources of performance fees now.
Something like 10 of our affiliates have substantial performance fee potential. I would argue that we should receive material, meaningful performance fees each year. I'm not looking to debate that right now. As I said, I'm just delivering the results with a little bit of interpretation, if I may, and hopefully that is helpful. Everyone can make up their own minds, as I said, about our results. Footnote three just points out our dividend yield. With the amount of dividends that we have declared, this represented a yield of 3.9%, grossed up to 5.6% for the franking benefit. That was based on share price at the close on 30th of June. The yield is more like 3% or 4.4% grossed up based on our closing share price yesterday. That's just in a nutshell, the financial highlights for the year.
Slide four shows the financial results in a little more detail. I'm not going to spend much time on this. At the top is Pinnacle Parent's revenues and expenses. Pinnacle Parent revenues were up 6.2% to AUD 22.4 million. That included dividends and distributions on principal investments, which were lower this year than last year. Our expenses in Pinnacle Parent in raw numbers were up 18%, but if you look at footnotes two and three, I would say our true expenses are up hardly at all. Footnote two points out that Pinnacle Parent's expenses includes AUD 400,000 of interest on the CBA loan. That's fine, that's in Pinnacle Parent, but the revenue from that expense, our share of Coolabah's profits, is in our share of affiliate profits, not in Pinnacle Parent. That distorts things a little bit.
As mentioned, the expenses of Pinnacle Parent includes the realized and unrealized gains, mark-to-market, or losses. It was losses this year, so they're an expense. Previous year when it was a gain, it was a negative expense. That all distorts the comparison with the previous year. If you take out just the adjustment for gains and losses on PI, our expenses increased by AUD 1.8 million or 7.2%. If you take out the AUD 400,000 of interest and AUD 700,000 of PLH, and a bit of increase in non-cash LTI, there was negligible change in Pinnacle Parent's expenses. That's more than enough talk of our numbers. The rest of this slide just shows some of those adjustments and is self-explanatory. Slide five shows movements in our funds under management. I'll just call out the highlights here.
Our aggregate affiliate funds under management at thirtieth of June were AUD 58.7 billion. This was up AUD 4.4 billion on the thirtieth of June last year or 8%. That includes AUD 3 billion that was acquired with Coolabah. Our FUM was up just AUD 1.4 billion on the year if you exclude the AUD 2 billion acquired. Our fund was down AUD 2.9 billion over the six months. People would be aware that the drop in the market impacted our fund and our inflows were lower as a result of the crisis, the virus crisis. Our aggregate retail funds under management are now AUD 13.1 billion. That was up from AUD 11.6 billion a year ago, down from AUD 14.3 billion six months ago.
Again, the one-year number includes AUD 1.6 billion that we acquired with Coolabah. Our funds under management was, as I said, impacted, of course, by the sharp drop in equities markets in late February and March. The ASX was down 10.8% over the whole financial year. It was down 11.9% in the second half. The MSCI World was flat over the full year, down 7.1% in the second half. Overall, we had decreases in our FUM due to market movements. When we say due to market movements/investment performance, because we can't really split those, but it was basically market movements. That was during the financial year, was down AUD 1.6 billion, our FUM, on account of market movements, and AUD 1 billion of that was retail. That was during the financial year.
In the second half, our total sum was actually down AUD 2.9 billion on the half, of which AUD 1.2 billion was retail. We were quite seriously impacted by the market movements. Finally on this slide, we make the point that we have an increasingly diversified client base. More on this later. We believe this is a very favorable trend for our company and was very helpful during this crisis period. I'll move quickly to a few more. Slide six outlines our net inflows. We achieved, as I said, net inflows for the financial year of AUD 3 billion, AUD 1 billion of which was in the second half. It was AUD 2 billion in the first half and AUD 1 billion in the second half. Retail net inflows for the second half was just AUD 19 million. It's a kind of tiny number, but positive.
That was comprised of 68 million of what I call sort of normal retail inflows and LIC outflows, which were buybacks of AUD 49 million. These inflow numbers, of course, were much lower than in the comparable previous periods. At least we didn't have large outflows at all, as many fund managers did. It was pleasing that even in the half, we were marginally in positive territory. We felt that shareholders would be interested in the pattern of the second half retail net flows, just briefly. In the second half, we achieved net inflows in January and then in May and June. The average net inflows for those three months was AUD 117 million a month.
We experienced net outflows in February, March, and April, but these were very modest except in March, where we had the large net outflows of AUD 238 million in that one month of March. The half year was our toughest half year we've ever had, but it was really quite concentrated in that month of March. Overall for the half, it was just a tiny bit net inflow overall. In institutional, we achieved net inflows of AUD 2.1 billion during the year, AUD 900 million of which was in the second half. This was clearly lower than we had expected originally because a number of institutional allocators deferred decision-making. I'm sure there'll be questions on this, and I'm sure Andrew Chambers would like to take some time to speak to this later.
Just in summary, we had deferrals of inflows that we were expecting, but we believe our institutional prospects currently remain strong. Pleasingly, this is from an increasingly diverse client set. Although we make the point that institutional flows are lumpy and two swallows don't necessarily make a spring, it's nevertheless pleasing that the institutional net inflows were stronger again in May and June. At the end of the year, we had quite strong net inflows. Slide seven, just a few points on affiliates, which I won't go through in detail. We commenced three new affiliates during the year, two builds or Horizon Two, Reminiscent and Aikya, and one Horizon Three, which was the acquisition of 25% of Coolabah.
We were pleased that five affiliates earned meaningful performance fees for the year, totaling AUD 26.7 million, and our share of those was AUD 6.6 million in the 2020 financial year. This was almost entirely received in the second half. Slides eight and nine seek to provide further explanation of the financial outcomes for the year. Very briefly, our total affiliate revenues were at AUD 291.1 million during the year, including the AUD 26.7 million of performance fees. This is up 22.9% on the 2019 year or 19.4% if you want to exclude performance fees. The table on slide eight traces the affiliate aggregate revenue down to aggregate affiliate after-tax profits. Then our share of that. Slide nine highlights the more significant components of the results.
In Pinnacle Parent, we do have a certain amount of success base and some base distribution fee revenue which was held back due to the market dislocation in the second half with, as I mentioned, certain deferrals of institutional allocations and lower retail net inflows. Our staff numbers didn't grow significantly during the year, we did not make cuts to our core capabilities. We think that's very important. There were significant reductions in short-term incentives. Our remuneration was restrained for the year. We did achieve significant growth in our share of affiliate profits compared with the previous year, there's been continuing investment in additional resourcing by several of our affiliates, including Metrics, Plato, Firetrail, Antipodes, Palisade, and Spheria. The direct costs of these new affiliates that are not yet profitable is included as negative NPAT.
There's also our costs of servicing those affiliates are in the Pinnacle parent costs. We don't charge those affiliates for our services until they're profitable. Slide 10 points on our balance sheet. I won't particularly call out anything there. I think people are aware that we record the value of our investments in affiliates on an equity-accounted basis, essentially cost, not what one might consider a market value of them. Slide seven shows graphically the growth of our FUM over the years. Really those slides, seven to 11, are all about our FUM. I should say the diversification of our FUM. Slide 12 is for the analysts who like to see the FUM by affiliate every six months. We set that out, and that's there to be examined. Slide five is the five-year performance slide.
This is the classic measure of long-term performance that the industry considers should always be reported, and we always do report it. Pleasingly, 90% of our affiliate strategies and products that have a five-year record have outperformed their benchmark. Short-term performance will always vary, but long-term performance is what matters most. The next two slides, 14 and 15, show the one year and more performance of all of our affiliates. We might get to those in question time. Slide 16 records the major industry awards that our affiliates win. We do very well in industry awards. Slide 17 is, yes, this major theme of our presentations of recent years, building a resilient, diversified business. Happily, this came through for us in this difficult year.
We believe this diversification will continue to stand us in good stead, and this is demonstrated in the next seven slides, which provide further detail of this diversification. I won't go through them. Let's skip to slide 22. Just quickly, this shows how our FUM and our revenue, particularly from retail, has grown from 27% when we rolled up and the listed company became Pinnacle four years ago, to 43% now. Industry super FUMs that some people express concerns about only represent 14% of our revenue. No time to go into more detail on that, but we believe it shows a great trend in the diversification of our funds under management. Slide 23 there shows that retail FUMs have grown 14.6 times over the past seven years, while our total FUM has grown 5.4x .
Slide 24 shows the growth in FUM that's eligible for performance fees. I mentioned before, 32% of our FUM or AUD 18.9 billion is all eligible for performance fees now and across quite a diversified range of affiliates. I'm almost to the end now. I better stop. I'll stop on slide 25, if I may. This is the slide headed, Our response to the COVID-19 crisis. We believe that we've performed very solidly during this terrible crisis, as I mentioned.
We've been saying for a long time this quote at the beginning of this slide, that "We believe that the reputations and future success or otherwise of investment management companies are often determined by their behavior and performance during periods of crisis, and their capacity to resume growth depends on the strength of the capabilities with which they emerge from such crises." We think this is very important. This has been, and still is, at the forefront of our minds, both prior to and during the crisis.
We're not making any predictions as to the future path of the crisis and related market conditions, but we are confident that we enter the new financial year poised to resume strong growth and able to respond to any further external adversity that may come our way as it did in the last half, and able to take advantage of any attractive opportunities that may materialize. Apologies, I've gone on a bit too much. I will stop talking now and hand us back to Miles for questions. Again, please address questions for any one of the four of us.
Thank you. Ladies and gentlemen, we will begin that Q&A session. Once again, if you do wish to ask a question, you can just press star one on your telephone. We do have our first question on the line from John Hinde from Wilsons. Please ask your question, John.
Good morning, gents. Thanks for your presentation. Just a couple of quick ones from me. In regards to FUM diversification, has there been any material developments not evident to the naked eye in this result, which we should probably focus on? Perhaps an update on the progress of the recent additions to the distribution team. Where are we seeing the greatest traction, and is there an update on how successful the new members have been to date, please?
Look, I might just start, but Andrew Chambers I'm sure will have more to say on this. One thing that perhaps isn't too apparent in our slides is that we've had further growth in our offshore, in FUM sourced offshore, and it's still reasonably early days, but we are very happy with the way that's traveling and the prospects there. Chambers, do you want to talk to John's question?
Sure. I would support Ian's view that certainly we've seen some significant growth outside of Australia. During the course of the financial year, we received inflows from about 15 countries outside of Australia. That's all the three major regions of the globe. That being the Asia Pacific region, the EMEA region, and the Americas. Significant flows out of the EMEA region in particular, would be noteworthy. We've added people during the course of the financial year in the Americas, with Allison Najmabadi based in New York City, and also with the responsibility of Japan, Hajime Kobayashi, who's come to us with significant experience working for major competitor institutions.
With the business today, we have employees in all the major regions of the globe, that being the Americas, Asia Pacific region, and EMEA, and covering specialized markets such as Japan. We are very much operating within the business day of all of our investors, and our allocators are able to conduct business very actively. It's now being supported by very good flows. Of course, we've been flying in and out of those key global markets for over a decade now, a lot of work had been done prior to people arriving. This has been now capitalized on the opportunities there for our boutiques as they continue to globalize both their products but also their presence in offshore markets. I should highlight that on one hand, one might assume the pandemic has pushed the world further away from us.
In many ways, I think it's brought the world closer to us, as we've seen encouraging signs of work adaptation from asset owners and consultants around the world in workarounds through virtual due diligence. Once upon a time, you'd need to conduct on-site due diligence with the fund manager before making allocations. These days, many funds are moving to virtual due diligence workarounds, which brings Australia close to the rest of the world. That's a very encouraging development.
Yeah. John, we did point out that we had some good net inflows in the last couple of months. Overall, we had AUD 1 billion of net inflows in the second half. As I mentioned, a lot of fund managers did a lot worse than that. There were outflows. We could spend more time on the sort of turmoil in the markets during the period. We can't predict what lies ahead, but it feels quite good to us coming out of the financial year at this stage.
If I may add to that, I'd just make the observation that the net flows from the three major distribution channels, which are the institutional, international, and retail, ebbed then flowed with the tide of government and central bank action. Obviously you saw drawing up outflows in terms of cash accumulation and liquidity provisioning in February, March, and April. In May, June, and July, we observed significant cash deployment into risk assets by all three of those major channels. From an institutional perspective, what we've really observed has been the cumulative impact of deferred allocations, many of which have had multi-year sales cycles to them, tactical portfolio rebalancing back into risk assets, and new opportunities which have emerged since and in response to the crisis itself. That'd be a good way to summarize it.
Thank you. I think in the first half you provided a FUM from international investors that was invested in international pooled funds for about AUD 4 billion. Are you able to give us any color on how that's changed with, it looks like some of the, obviously what you're talking to in some of the funds have had success, especially in April this year. How much has that changed?
The number of- Ian, do you want me to respond to that?
Yes, thanks.
I guess a number of our key managers were able to source capital from offshore. I'd say in particular, the standout during this period has been Resolution Capital. It's probably been the most advanced of all of our affiliates in terms of its globalization trend, as it started from the point in which we partnered with them back in 2007. That would be the most progressed. I would highlight that the AUD 4 billion of FUM that you would be, noted included FUM sourced in offshore funds as well as from offshore investors. It includes potentially Australian-based investors invested in offshore funds also. The effect of institutional capital from offshore going into allocating to us from offshore investors has been probably larger than what you probably observe on the surface.
We're seeing quite a bit of market interest in the likes of Antipodes with their global long strategies, and in a lot of our private capital managers as well, and hedge fund strategies. In terms of key locations, in terms of larger source FUM would be, I'd say the Middle East and Africa, and Canada has been a significant market for us, and also would highlight Japan, and most recently, the United Kingdom.
Great. Thanks, gents. I'll jump back in the queue.
Okay. Once again, if you wish to ask a question, you can just press star one. The next question in line we've got from Nicholas McGarrigle from Ord. Please ask your question, Nicholas.
Thanks, guys. That was very well pronounced on my last name. Probably the best ever, I reckon, in my 10 years of doing calls. In terms of flows, you mentioned that late in the financial year, you saw quite strong flows. Can you just give us a sense on where that was flowing to in terms of the managers and any sort of trends, whether that's retail or institutional, in terms of taking a bit more confidence in allocating at the moment?
Yeah. Well, again, I'll let Chambers talk to the institutional. Those last two months, we had nice inflows in both retail and institutional. As Andrew Chambers said earlier, there was a real pattern to the half. He said ebbed and flowed. There were definitely quite major disruption in late February and March, and that appeared to have really somewhat reversed by May, June. As I said, these are reasonably short time frames, but that was a very clear pattern. The inflows in May and June were both retail and institutional. Chambers, do you want to speak to whereabouts in institutional? Res Cap has been doing well, for example, but it was a number of affiliates.
Yeah, I'd highlight, in addition to Resolution Capital, be worth highlighting, singling out Coolabah Capital in terms of receiving new allocations. Metrics Credit Partners also on receiving new allocations. Hyperion into its global strategy, which we've been talking to you about at Quick Investors for some time. We're seeing very promising signs about new deployment. I'd also highlight we're seeing similar flow increases in the retail market as well. I think they're averaging a little over AUD 20 million net a month at the moment from retail investors into their global strategy.
Hyperion Global is building in retail as well.
Sorry, what was that number a month, and what is it standing at now in terms of funds?
About AUD 20 million of net flows a month, it was about AUD 22 million of the exact numbers. I took the average. The total sum, as you see in the pooled funds, today is around about AUD 400 million, I think, at last count.
Cool. It seems like some of the affiliates really controlled their cost bases through the last year because, obviously, the profit contribution was outsized as compared to the revenue that we can see in the annual report. Was that a focus for the underlying affiliates?
No, I don't think our affiliates are excessively. Obviously, everyone is being careful about cost in this environment. No, I called out quite a number of our affiliates that have actually added resources ahead of further growth where they're adding new strategies, Nick. No, I think their revenue was quite a bit higher. That caused their profits to be higher. I don't think it was particularly a cost control or cost reduction factor.
That's good. That's fine. The final year numbers looked pretty solid across the board versus what I was expecting, apart from Two Trees. Can you just give us a sense on what's going on there? Then potentially some of the long tail, the Longwave, Riparian, Reminiscent, and Aikya, what their outlook is for FY 2021?
Yes. When you said the end of year numbers, you mean the performance numbers?
No, no, sorry. Just the fund. The fund ends up a bit ahead of what I was expecting, which is great. Just comment on Two Trees.
Yeah. Two Trees are systematic global macro, and they had won some very nice money early in their life, institutional money, which, in that turmoil period that Andrew mentioned, some of the big super funds were sort of taking money from wherever they could find it that hadn't been impacted by the equities market drop. Hedge funds hadn't dropped in value in the way that equities did, and they had some significant redemptions from super funds that I think were looking to take cash and probably have subsequently redeployed into equities, which was quite bad luck. You know that whole hedge fund, that global macro hedge fund space has struggled somewhat, performance-wise during the crisis. Some of the big names have done very poorly. That was a bit of bad luck for them in terms of losing that sum.
We're hopeful it will come back again when things become more normal. Look, we're very pleased, Chambers, we're very pleased with how Aikya and Reminiscent and Riparian are traveling along. You won't win big money early, Nick, in these, but we're very happy with the way they're traveling.
Ian, just to add to that, hedge fund is the asset class, and particularly the hedge fund ones where it's lower or AUM that you win, but there's typically much higher margins, whereas something like Aikya being long only, the allocations will tend to be larger. Noting that the capacity is probably around about $5.5 billion U.S. for that, but the allocations will typically be higher than what you would see for the hedge fund or cash plus type strategy, such as Two Trees or Reminiscent Capital or Riparian, for that matter, which has a bit more of a profile, that latter one, more akin to Palisade, given its mid-market focus, so can only deploy probably AUD 200 million per annum.
The affiliates that are newer to us that will win the large fund quickly are the established ones, so Coolabah and Metrics. We're very pleased with the performance of both of those and with their prospects. There's no question that Metrics, in particular, lost pipeline. There was a lot of money ready to come into them that was deferred, and that was unfortunate. Their MXT capital raise had to be called off because of the impact of the crisis on the market. They were impacted, but we're very pleased with Metrics and Coolabah and how they're traveling.
In fact, just to support you on that, Ian. Metrics has received three new allocations from a debt who had previously deferred their decisions since that period earlier in March. People are resuming their activity prior to the crisis, in my comments, Ian.
Some of that's in July, I think.
Yeah
would be in the numbers that we've put out.
That's correct.
ResCap's also interesting. If you remember, I think ResCap has had tremendous alpha and their asset class went up a lot pre-crisis. We actually had quite substantial outflows from Aussie instos in ResCap over the last couple of years, but we're getting very strong inflows from offshore, and we'll see whether that trend in domestic instos reverses somewhat as well. Remains to be seen.
It's really good to see, obviously, Coolabah as well adding AUD 600 million over the six months. Can you give us some context on that growth, and was that largely owed to the acquisition and the assistance from your distribution team, or was that natural momentum that they had and given cash rates moving where they are, that they've seen a bit more uplift?
Well, we'd love to claim credit for our distribution genius being responsible for it. Do you want to comment on that again, Andrew? They're going well. They are. They're doing very well. They're getting new clients and extra allocations from existing clients.
Yeah. I think just to add to that, Ian, there's always a sales cycle to any partnership you have with an affiliate. There was very good momentum for that business, there's no doubt about it. Most of the flows came from family offices and institutions, also wealth management as well. It's a combination of self-generated momentum, also, obviously, assistance we've provided since. The answer is it's a combination.
Yeah. That’s great. Can you provide us a bit of an outlook? I mean, the net overheads seem to be relatively well managed in light of the difficulties on distribution. Any sort of outlook into next year around some of the more main contributors to the Pinnacle Parent revenue line, things like LICs and material distribution, I guess, of some of the affiliates where you’ve got those relationships. Can you comment on that net overhead into next year, potentially?
Yeah. I mean, LICs, I think have a question mark over them in terms of certainly, Equity Allied certain IPOs. I think that will be quite challenged in the short term until the market adjusts to the government's new policy. We would hope to be able to do some top-ups of existing LITs, such as Metrics, especially. It depends on market conditions. Look, it's hard to predict what the conditions are gonna be like over the next year, Nick. We feel pretty good. Our Pinnacle Parent revenues have held up reasonably well, and we do have prospects for some more success-based revenues there from the likes of ResCap and our retail efforts, especially. There are a number of other efforts to retail that are going to do well in retail going forward, including Hyperion Global, ResCap, Coolabah, Metrics, and so on, and they all pay us fees.
Great. I might let someone else ask a question. Thanks.
Okay, we do have another question in line from Tim Lawson from Macquarie. Please ask your question, Tim.
Hi, gentlemen. Thanks for taking my questions. Just a point of clarity. I think you mentioned Metrics might have had some funding into July. Maybe I'll ask a more general question. Just of those May and June, particularly institutional flow, how much of that was fully funded at 30 June and how much is still in the pipeline to collect going forward?
Andrew?
I don't think we received any commitments that were undrawn during the balance of the financial year. Everything we're talking about was fully drawn. I think the ones I've highlighted in relation to Metrics have come on this side of 30 June, so in the July month. They wouldn't be reflected in our full-year numbers.
I appreciate that, sometimes you might get 50% funded, and then there's 50% to come. Is there any balance that is effectively committed, not in your numbers, but to be funded in July, August, September?
If I can just answer that. We do know that there are a number of mandates that we've been told will be arriving in August, September, and so on. The difficulty we have, Tim, we don't want to make predictions of market conditions and make promises that we disappoint on. We've been a bit cautious, but certainly, we said it feels very good going into the new year, and we certainly have a number of people who've told us that we're going to win money. The problem we have is that we've been in this position before. We've talked about a pipeline and then circumstances change, and it gets deferred. We've tried to avoid doing that. We're trying to give you a balanced response there, but we certainly do have money that we believe is coming in August and September.
Yeah, that's fine. Thanks.
Maybe the moderate word to you is we're quietly confident about the prospects ahead.
Yeah. Just a second question. You called out, I think it was 32 and a touch percent in performance fee, fund that can attract performance fees. Also probably more importantly, how much of that is at or near a high-water mark?
Yeah. It's been growing, Tim. I think it was 30% a year ago, 32%, but it had grown quite a lot up to that last year. I think we have some slides there that show that it's grown in the last, say, four years. It's grown a great deal. That's a very good thing. Look, as I said, it's across 10 of our affiliates have quite meaningful potential performance fee contribution. It's quite diversified as well. Obviously, the two largest are Antipodes and Firetrail High Conviction behind their high-water marks. Of course, these things can turn very quickly, but they are behind at this stage. There's quite a lot of it that the fact that we receive performance fees in 2020 means that those are all not behind their high-water mark.
If they produce further alpha, they can get performance fees in the near term. There's another one, is ResCap, which had 9% alpha during the year. Now, its performance fees are all on its funds, which is about AUD 900 odd million of funds, but it has a dual test, namely retail investors. It had very strong alpha, but it doesn't get paid performance fees if the absolute return for the year isn't positive, which it wasn't because the market so much. It goes into the new year with carrying forward all of that alpha, which is a nice position to be entering the new year. It would need to not give the alpha back and also to have positive absolute return in the year ahead. That's just one, ResCap.
Does that positive absolute return reset to the level at 30 June or does it have to make up what the lost performance for last year was in absolute sense?
It's a good question. I think it just has to be absolute during the year, but I'd need to check that. I'm sorry.
Okay.
It'll be in the PDS.
Yeah. Just last question from me. The performance fees, obviously, you pre-announced that, but again, it was just slightly higher. Just trying to understand where that was from. Was it from one of the five affiliates you named? Just trying to understand the slight variance there.
The variance from what we've pre-announced?
Yeah.
Dan, can you help with that? I think it's something to do with what we pre-announced. We were trying to have a go at impact on Pinnacle overall as opposed to our share of-
Yeah, there's a couple of bits there. We obviously announced very early, Tim. A couple of those performance fees were on mandates. That pricing didn't finalize until a couple of weeks later. We went with a fairly conservative estimate. We also announced specifically on the AUD 7 million was the total impact on P&L, which includes some distribution fees associated with those distribution revenues. The AUD 6.6 million is just purely our share of those performance fees through the affiliates' profits.
Yeah, okay. Thanks. That's all from me.
Once again, ladies and gentlemen, if you did wish to ask a question, you can just press star one on your telephone now. Okay, there appears to be no further questions at this stage. I might hand back to you for now to wrap up, Ian.
Thanks very much, Miles. look, thanks for your participation, everyone. We can only do so much in an hour. We've tried to draw out the themes really at the beginning and the end of our presentation. We're going to have one-on-one meetings with lots of fund managers over the next few days. There'll be plenty of opportunity for further questions. Overall, a very tough half, obviously, for the whole world, for fund managers generally. We think we've done okay in the circumstances. We are very pleased to see the benefits of that diversification really help us in a tough period. We do feel good about moving forward. That kind of whatever conditions we might face, we feel as though we're in quite a strong position.
Yeah, that's really a summary of the year, and we look forward to speaking with major shareholders one on one.
Okay. Ladies and gentlemen, that will conclude today's conference call. Again, thank you for all participating today. You may now all disconnect.