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Final results before merger

Standard Life lifts dividend as flagship fund hit

Keith SkeochStandard Life saw first half operating profits leap 6% though its flagship fund took a hit as the company prepares for its merger with Aberdeen Asset Management.

Investors withdrew £5.6 billion from the Global Absolute Return Strategies (GARS) fund, outweighing inflows into other funds. Assets under administration are 1% higher at £361.9bn.

In its final results before the merger, Standard Life said the dividend will rise 8.2%, in line with forecasts.

The tie-up with Aberdeen, to form Standard Life Aberdeen, is expected to expand the range of funds on offer and will complete next Monday.

Speaking in a media call, Keith Skeoch, Chief Executive, said markets had got used to uncertainty and become “de-sensitised” to the “noise” around them helped by low inflation and interest rates.

“Because growth is slow and steady it is not being buffeted as much as people expect. Markets are starting to price this in.”

He said: “A big difference between 2016 and 2017 is that markets are connecting with fundamentals whereas last year they were connecting with sentiment.”

In his statement on the results he said: “Standard Life has delivered a strong performance in the first half of 2017 with fee based revenue up 5% and operating profit up 6%.

“We continue to see the benefits of targeted investments to further our diversification agenda, the success of our newer investment solutions and the ongoing focus on operational efficiency. This has allowed us to grow assets, profits, cash flows and returns to shareholders.

“With the proposed merger with Aberdeen on track for completion on 14 August we are ready to accelerate the pace of strategic delivery as we open the next chapter of our transformation to a diversified world-class investment company.

“The combined leadership team of Standard Life and Aberdeen has been working well together to ensure “Day 1″ readiness. We are well placed to continue to meet changing client and customer needs globally, and to generate growing and sustainable returns for our shareholders.”

Highlights

H1 2017

H1 2016

Assets under administration (£bn)

361.9

357.11

1%

Net flows (£bn)

(3.7)

0.9

N/A

Fee based revenue (£m)

836

794

5%

Operating profit before tax (£m)

362

341

6%

Diluted operating EPS (p)

16.4

13.5

21%

Underlying cash generation (£m)

256

254

1%

Profit for the period attributable to equity holders of Standard Life plc (£m)

292

226

29%

Interim dividend per share (p)

7.00

6.47

8.2%

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