Firm says it remains 'robust'
Standard Life Aberdeen says loss of funds ‘a challenge’
Martin Gilbert and Keith Skeoch: ‘winning new mandates’ (pic: Terry Murden)
Standard Life Aberdeen today admitted that outflows of funds “remain a challenge” but said they were concentrated in a “narrow range of strategies”.
The company £16.6 billion was withdrawn over the half year but said inflows were robust and that it was looking towards “a good and diverse pipeline” including further significant business from the partnership with Phoenix which bought its life business.
In a media conference call, co-CEOs Martin Gilbert and Keith Skeoch attempted to put the flow of funds into context.
Mr Skeoch said: “We are taking action to improve investment performance.” Mr Gilbert added: “Outflows look high but are only 2% of assets under management.”
The company is releasing an initial payment of £175m in the next few days, as part of a capital return of up to £1.75bn to shareholders and has declared an interim dividend up 4.3% to 7.3p.
Adjusted profit before tax from continuing operations fell 12% from a year earlier to £311m, below analysts’ expectations of £325m. Assets under management at fund management arm Aberdeen Standard Investments were £610.1bn at the end of June 30, against £627bn a year earlier.
Investors responded positively to the announcement and marked the shares 1.6% higher in early trade.
In a statement Mr Gilbert and Mr Skeoch said: “Conditions for the asset management industry continue to be challenging. However, our gross inflows remain robust and are spread across a diverse range of investment capabilities, and our market-leading adviser platforms continue to grow.
“Our investment and distribution teams are winning new mandates and we have a good and diverse pipeline of business from around the world. We are actively taking steps to improve our investment performance in key areas and are encouraged by the impact of these initiatives.
“We are also pleased by progress on the integration programme and achievement of cost synergies. The sale of our UK and European insurance operations will complete our transformation to a capital light business and enhances our strategic partnership with Phoenix.
“Our financial strength allows us to return up to £1.75 billion of capital to shareholders and we will commence the first tranche of £175m in the next few days.
“We will still have one of the strongest balance sheets in the sector, which enables us to continue to develop and broaden our areas of strength and focus on delivering long-term performance for our clients.”