Polar Capital on top of the world

Specialist investment management firm Polar Capital Holdings saw net inflows of funds in every quarter in its last financial year, despite turbulent market conditions.

Assets under management (AUM) at the end of March stood at $5.08bn, 31% higher than AUM of $3.87bn a year earlier, despite, as Polar's Chairman Tim Bartlam put it, "the markets providing little in the way of help this year." The growth in assets was largely due to continued strong inflows across a number of Polar's products, especially the Japan and Global Insurance funds. The only disappointment was on the UK Funds which finished in negative territory for the year, leading to further outflows from these products.

Net performance fees of £4.1m were down on last year's figure of £5.7m although the firm seemed proud of its achievement of eleven successive year of generating such fees.

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Core operating profit excluding performance fees in the year virtually doubled to £7.1m from £3.6m the year before. Pre-tax profit climbed £0.4m to £9.6m, short of analyst expectations of £11m. Basic earnings per share were up 10% to 9.48p (2011:8.64p). Revenue was stable at £39.9m (2011: £39.1m).

The dividend was increased from 7.5p per share to 9p, a rise of 20%.

Tim Woolley, Chief Executive, said: "The group has continued to make good progress in the face of challenging market conditions and encouragingly we saw net inflows of over $1.0bn during the year. Investment performance has been strong with seven out of eight long only funds in the top quartile for the year and four out of our six hedge Funds ending the year in positive territory.

"We also continue to deliver on our strategy of diversifying our offering with the addition of three new teams and strategies, bringing us up to eleven teams in total, and expanding our distribution capability further.

"Assuming market conditions do not deteriorate further, we are well positioned for further significant growth in the year ahead."

Woolley's boss, Tim Bartlam, seemed to be hinting, however, that a deterioration in market conditions could be on the cards.

"It is difficult to envisage anything other than another turbulent year ahead. With the exception of Germany most of the other major European economies are seeing weakness which is only serving to make the debt crisis worse," he noted.

"As long as we continue to deliver the levels of performance we have historically achieved I believe we have the opportunity for substantial further growth in the years to come," he added.

The share price rose 1.9% to 187p by 12:00.

NR