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

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Most Popular

Why we won’t see a house-price crash in 2021
House prices

Why we won’t see a house-price crash in 2021

Lockdown sent house prices berserk as cooped up home-workers fled for bigger properties in the country. And while they won’t rise quite as much this y…
18 Jan 2021
The world’s fund managers are getting very bullish – be careful out there
Stockmarkets

The world’s fund managers are getting very bullish – be careful out there

The latest survey of fund managers shows them to be extremely bullish on all the same things. And that, says John Stepek, means the market is in dange…
21 Jan 2021
Inflation is the easiest way out of this – just don’t expect politicians to admit it
Inflation

Inflation is the easiest way out of this – just don’t expect politicians to admit it

The UK government borrowed £34.1bn in December, a record amount for that month. Britain's debt pile now amounts to 100% of GDP. How are we going to pa…
22 Jan 2021