Adjusted profits edge higher at Man Group
Adjusted profit before tax (PBT) rose to 278m dollars in the full year to December 31st from 262m dollars in the nine months to December 31st 2011 at Man Group.
Adjusted profit before tax (PBT) rose to 278m dollars in the full year to December 31st from 262m dollars in the nine months to December 31st 2011 at Man Group.
The FTSE 100-listed alternative asset manager reported that funds under management at the end of 2012 were $57bn compared to $58.4bn in the nine months to December 31st in the preceding year.
Gross management and other fees were valued at $1.21bn compared to $1.16bn across the same two time frames.
The group reported a statutory loss before tax for the year ending December 31st of $745m reflecting impairment of goodwill and other adjusting items.
Man Group reported that $95m of operating cost savings announced in January 2012 have been delivered and further annual cost savings of $100m announced in July 2012 were on track for delivery by the end of 2013.
The company recorded surplus regulatory capital of $745m at December 31st 2012 and proposed a final dividend of 12.5 cents per share. The total dividend for the year is expected to be 22 cents.
CEO: "2012 was another tough year"Manny Roman, Chief Executive Officer of Man, said: "2012 was another tough year for Man. Trading conditions were highly challenging as markets continued to be dominated by political uncertainties in Europe and the US and macroeconomic risks. Investor appetite remained muted and as expected there was a further decline in Man's product margin mix and revenues.
"Management's priority last year was to maintain the focus on delivering investment performance for our investors, while reducing our cost base to a level which reflects the economics of a reduced and different mix of asset flows. On both counts we made good progress.
"As of mid-February 2013, most of our strategies were off to a good start and there is no doubt investor sentiment has improved somewhat. The number of requests for proposals and the pipeline of new mandates have increased to a degree. However, given the lead time required by institutional investors to invest, gross sales are likely to remain muted in the first half and we are yet to see a slow down in the rate of redemptions."
Analysts' view: Profits beat Credit Suisse's forecastGurjit Kambo, a research analyst at Credit Suisse, left his target price for the stock unchanged at 104p and retained his 'neutral' rating.
He said: "FY12 adjusted PBT (excluding one-offs totalling c$1.0bn which included a further GLG impairment of $746m) came in at $278m which was ahead of our $187m forecast, driven by revenues $73m higher (of which $46m was performance fees), lower distribution costs of $11m and other costs (inc net interest) c$7.0m lower vs. our forecasts."
Man Group's share price was up 2.33% to 105.40p at 09:16 on Thursday morning.
MF