F&C posts drop in assets under management

The F&C Asset Management Group revealed a drop in assets under management and revenues as it unveiled its 2012 results on Thursday.

The F&C Asset Management Group revealed a drop in assets under management and revenues as it unveiled its 2012 results on Thursday.

Assets under management fell 4.9% year-on-year to £95.2bn as clients including Friends Life pulled money from its funds.

Net revenues dropped 8.8% to £243.5m from £267m a year earlier.

The company was hit by a £5.3bn withdrawal from major clients including Friends Life which may extract a further £6.2bn in the first half.

F&C also blamed economic uncertainty for dampening investors' willingness to commit savings to risk assets.

Investment trusts reported net inflows of £20m, with new share issuance by trusts offsetting share buy-backs during the period.

Net outflows of £13.3bn foreign-exchange rate movements offset a £10.1bn gain in assets prices. Hedge fund unit Thames River Global Credit and Global Bond products suffered significant outflows, the firm stated.

Chairman Edward Bramson said he intends to boost growth by cutting costs, reducing debt and focusing on investment trusts and managing fixed income assets for insurers.

"As a result of the hard work of restructuring during the last 18 months the company is now in a position to invest for growth in new markets and capabilities," he said.

"This task will fall, in large part, to the new management team and in particular to Richard Wilson who became [Chief Executive Officer] on January 1st."

The group achieved an underlying operating profit of £71.2m for 2012, up from £65.2m as the company's cost reductions came in line with plan, and the firm won 54 institutional mandates including 44 new clients.

Underlying earnings per share increased 29% to 7.1p.

New boss Richard Wilson said: "This is a robust and much improved set of financial results. The company has made significant progress towards its strategic goals in 2012.

"With the restructuring now substantially completed, good investment performance and a newly strengthened management team in place, F&C is now in a position to invest for growth in new markets and capabilities."

Shares rose 0.18% to 109.60p at 08:57 Thursday.

RD

Recommended

The MoneyWeek Podcast: picking stocks is fun, but you need to do your homework
Investment strategy

The MoneyWeek Podcast: picking stocks is fun, but you need to do your homework

John Stepek talks to Steve Clapham, investor, analyst and author of The Smart Money Method, about the dangers in picking individual stocks and why you…
8 Apr 2021
BP looks set to return more money to shareholders as it beats expectations
Energy stocks

BP looks set to return more money to shareholders as it beats expectations

Oil major BP is to embark on a share buyback programme after significantly reducing its debts. Saloni Sardana looks at what it means for your portfoli…
6 Apr 2021
Deliveroo has hit the market – but it’s not getting the warmest welcome
UK stockmarkets

Deliveroo has hit the market – but it’s not getting the warmest welcome

Food delivery company Deliveroo made its debut on the stockmarket this morning. But with the share price sliding by 30% straight away, it’s not made t…
31 Mar 2021
Three stocks to buy now that will come back stronger after Covid-19
Share tips

Three stocks to buy now that will come back stronger after Covid-19

Professional investor Ed Wielechowski of Odyssean Capital, chooses three compelling stocks that should thrive in a post-pandemic world.
29 Mar 2021

Most Popular

“Joke” cryptocurrency dogecoin goes to the moon. What’s going on?
Bitcoin

“Joke” cryptocurrency dogecoin goes to the moon. What’s going on?

Dogecoin – a cryptocurrency created as a joke – has risen by more than 9,000% this year alone. Saloni Sardana looks at how something that began as an …
19 Apr 2021
China owns a lot more gold than it’s letting on – and here’s why
Gold

China owns a lot more gold than it’s letting on – and here’s why

In a world awash with money-printing, a currency backed by gold would have great credibility. And China – with designs on the yuan becoming the world’…
21 Apr 2021
Why investment advice could be about to get a lot cheaper
Investment strategy

Why investment advice could be about to get a lot cheaper

Vanguard, the world’s second-biggest asset manager, is launching its own cut-price financial advice service. It’s something the industry badly needs, …
20 Apr 2021