TIDMADN
RNS Number : 9444W
Aberdeen Asset Management PLC
03 May 2016
ABERDEEN ASSET MANAGEMENT PLC
Interim Results for six months to 31 March 2016
Highlights
-- Net revenue GBP483.6 million (-20%)
-- Underlying profit before tax GBP162.9 million (-40%)
-- Underlying earnings per share 9.6p (-41%)
-- Interim dividend per share unchanged at 7.5p
-- AuM GBP292.8 billion
-- GBP70 million of annualised cost efficiencies to be delivered during 2017
FINANCIAL HIGHLIGHTS
March 2016 March 2015
----------------------------------------------------------------- ----------- -----------
Net revenue GBP483.6m GBP605.2m
Underlying results: before amortisation and acquisition-related
items
Profit before tax GBP162.9m GBP270.2m
Diluted earnings per share 9.6p 16.2p
----------------------------------------------------------------- ----------- -----------
Statutory results
Profit before tax GBP98.8m GBP185.4m
Diluted earnings per share 5.4p 10.7p
Dividend per share 7.5p 7.5p
Core operating cashflow GBP114.3m GBP227.4m
----------------------------------------------------------------- ----------- -----------
Gross new business GBP21.5bn GBP23.4bn
----------------------------------------------------------------- ----------- -----------
Net new business -GBP16.7bn -GBP11.3bn
----------------------------------------------------------------- ----------- -----------
Assets under management at period end GBP292.8bn GBP330.6bn
----------------------------------------------------------------- ----------- -----------
Martin Gilbert, Chief Executive of Aberdeen Asset Management,
commented:
"These results reflect the challenging conditions Aberdeen has
faced during the past three years, in particular the weakness in
emerging markets. However our balance sheet strength has allowed us
to continue to invest in the business, including the completion of
a number of bolt-on acquisitions which have added new capabilities
and new client channels. We have strengthened the management team
with senior appointments in distribution and operations. Our broad
product suite and global distribution platform means we are well
placed to meet the long-term needs of an ever increasing number of
investors around the world."
Management will host a presentation for analysts and
institutions today at 09:30 (UK) to be held at the offices of
Aberdeen Asset Management, Bow Bells House, 1 Bread Street, London
EC4M 9HH. The event will also be available to view via a live
webconference. To register please use the following weblink:
http://edge.media-server.com/m/p/zzud3n75
For more information:
Aberdeen Asset Management + 44 (0) 207 463 6000
Martin Gilbert
Bill Rattray
Maitland + 44 (0) 207 379 5151
Neil Bennett
Tom Eckersley
Chairman's statement
Much of the period to 31 March 2016 was played out against a
backdrop of ongoing fragile investor sentiment towards emerging
markets, with this cyclical slowdown exacerbated by the effects of
falling oil and commodity prices.
As we have reported before, our investment teams have not been
distracted by these factors, and have remained focused on the aim
of delivering the long term performance that our clients expect. It
is encouraging to note that our equity portfolios have performed
strongly against their respective benchmarks during the first four
months of 2016 as investors have begun to focus once again on
companies which had previously been undervalued by the market.
However, this does not mean a dramatic improvement in new
business flows is anticipated in the short term, as we recognise
that many potential investors may need more evidence that this
rotation is firmly established before investing. Gross new business
inflows have continued at healthy levels, while outflows have
moderated slightly. However, we remain vulnerable to further
outflows over the next few quarters as clients continue to react to
the difficult conditions for performance over the last few
years.
To some extent, these flows have been cushioned by the recent
rally in markets and the net addition of assets from transactions
completed in the period. As a consequence, total AuM at 31 March
2016 was GBP292.8 billion, a 3% increase compared to 30 September
2015.
During the six months, we have added further strength to our
management team to ensure we are equipped to respond to the
changing needs and expectations of investors. We have recently
announced the appointment of Campbell Fleming as Global Head of
Distribution; Iain Plunkett has been appointed Chief Operating
Officer in addition to his role of Chief Technology Officer; and
Martin Jennings has joined us as Head of Digital, which will be a
key focus as we move forward.
Financials
Profit before taxation for the period was GBP98.8 million (2015:
GBP185.4 million). Underlying profit, stated before amortisation of
intangible assets and acquisition-related items, was GBP162.9
million (2015: GBP270.2 million). This represents underlying
earnings per share, on a diluted basis, of 9.6p (2015: 16.2p).
Net revenue for the period fell by 20% to GBP483.6 million
(2015: GBP605.2 million). Recurring fee income reduced to GBP482.1
million (2015: GBP601.8 million), while performance related fee
income reduced to GBP1.5 million (2015: GBP3.4 million). The
blended average management fee rate for the period reduced to 33.4
basis points (2H 2015: 35.5 basis points) due to a shift in the mix
of AuM over the period.
Operating expenses for the period reduced to GBP327.7 million
(2015: GBP334.6 million), as a result of tight cost management. The
Group's operating margin for the period was 32.2%, compared to
42.7% reported for the full year to September 2015.
In part, the reduction in operating costs reflects the early
impact of the cost efficiency programme we have implemented. We
expect to reduce annual costs by approximately GBP70 million,
reflecting our long term focus on achieving further business
efficiencies through review of strategic outsourcing and supplier
arrangements, as well as process improvements across operations and
other support functions. Most of these initiatives will be
implemented by the end of the current financial year; we expect the
benefit of these savings to be approximately GBP50 million for the
financial year to 30 September 2017, with the full benefit
effective in 2018.
Dividend and capital management
The Board has decided to pay an interim dividend of 7.5p per
share, unchanged on the equivalent payment last year; this dividend
will be paid on 16 June 2016 to qualifying shareholders on the
register at 13 May 2016.
The cash position at the end of the period was GBP401.4 million
and we have strengthened our regulatory capital position further,
with headroom of GBP218 million over our regulatory capital
requirement at 31 March 2016. During the period, we generated
GBP114.3 million of core operating cashflow (2015: GBP227.4
million).
Review of operations
Assets under management increased to GBP292.8 billion. The
principal changes are shown in the following table, and a fuller
analysis by asset class is included at the end of the interim
results announcement.
GBPbn
-------------------------------- -------
AuM at 30 September 2015 283.7
-------------------------------- -------
Net new business flows (16.7)
-------------------------------- -------
Market movements & performance 10.1
-------------------------------- -------
FX movements 7.9
-------------------------------- -------
Corporate transactions 7.8
-------------------------------- -------
AuM at 31 March 2016 292.8
-------------------------------- -------
A net GBP7.8 billion of AuM was added from corporate
transactions completed in the period; the purchase of Arden,
Parmenion and Advance added GBP9.5 billion of new assets, offset by
the disposal of GBP1.7 billion of low margin property management
assets in order to deliver cost efficiencies.
Gross new business inflows for the period totalled GBP21.5
billion (2H 2015: GBP19.1 billion) and outflows amounted to GBP38.2
billion (2H 2015: GBP41.7 billion), resulting in a net outflow for
the six month period of GBP16.7 billion (2H 2015: net outflow
GBP22.6 billion).
In equities, net outflows slowed to GBP9.8 billion, compared to
GBP12.4 billion for 2H 2015; both Asia Pacific and emerging markets
showed improvement, although net outflows from global equities were
slightly higher than the previous period.
Last year we simplified the organisational structure of our
fixed income asset class, with focus on our global teams, supported
by our regional expertise. In particular, this has helped us to
make progress in our global fixed income offering.
The property team continued to attract new business into
segregated accounts, as well as winning new commitments for a
number of fund launches which will be realised in future periods.
While there will be some outflows from this asset class in the
second half of the year, we continue to see potential for gathering
further new assets.
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The multi asset team has continued to generate steady
performance and, although not yet reflected in flows, this
capability is well positioned to win new assets in future. One area
of specific focus is our diversified growth fund, which continues
to deliver good risk-adjusted performance. Against this, the
structural outflow from the closed insurance book acquired with
SWIP will continue for the foreseeable future.
Our alternatives business continues to progress and, following
completion of the FLAG and Arden acquisitions, we have created a
global platform with GBP21.8 billion of AuM covering private
equity, infrastructure, hedge fund and liquid alternatives. We
believe that we are well positioned to generate further organic
growth in future periods.
Outlook
We have seen recent evidence that our long term, value-based
equity investment process is once again beginning to find favour
with investors. This provides encouragement for the longer term,
but we envisage that markets may continue to provide challenges in
the short term. However, we are attracting interest in our broader
product range and our distribution effort will be focused on
winning new assets across our many capabilities. We will continue
to invest in the efficiency of the business to ensure that we
deliver the highest levels of client service and we expect that our
long term investment approach will generate value for our clients
and shareholders.
Roger Cornick
Chairman
Condensed consolidated income statement
For the six months to 31 March 2016
6 months to 31 March 2016 6 months to 31 March 2015 Year to 30 September 2015
---------------------------------------------------- ---------------------------------------------------- ----------------------------------------------------
Before Before Before
amortisation Amortisation amortisation Amortisation amortisation Amortisation
and and and and and and
acquisition-related acquisition-related acquisition-related acquisition-related acquisition-related acquisition-related
items items Total items items Total items items Total
Notes GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------------- ------- -------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Gross revenue 539.1 - 539.1 683.1 - 683.1 1,318.9 - 1,318.9
Commissions
payable (55.5) - (55.5) (77.9) - (77.9) (149.9) - (149.9)
-------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Net revenue 3 483.6 - 483.6 605.2 - 605.2 1,169.0 - 1,169.0
---------------------- ------ -------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Operating costs (327.7) - (327.7) (334.6) - (334.6) (670.3) - (670.3)
Amortisation
of intangible
assets - (59.9) (59.9) - (67.2) (67.2) - (131.3) (131.3)
Acquisition-related
costs 4 - (3.0) (3.0) - (14.4) (14.4) - (0.1) (0.1)
-------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Operating expenses (327.7) (62.9) (390.6) (334.6) (81.6) (416.2) (670.3) (131.4) (801.7)
---------------------- ------ -------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Operating profit 155.9 (62.9) 93.0 270.6 (81.6) 189.0 498.7 (131.4) 367.3
Net finance
income (costs) 6 0.9 (1.2) (0.3) 1.5 (3.2) (1.7) 2.5 (6.5) (4.0)
Gains (losses)
on investments 6.1 - 6.1 (1.9) - (1.9) (9.6) - (9.6)
---------------------- ------ -------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Profit before
taxation 162.9 (64.1) 98.8 270.2 (84.8) 185.4 491.6 (137.9) 353.7
Tax expense 7 (25.8) 9.8 (16.0) (45.6) 12.8 (32.8) (74.7) 30.0 (44.7)
-------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Profit for
the period 137.1 (54.3) 82.8 224.6 (72.0) 152.6 416.9 (107.9) 309.0
---------------------- ------ -------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Attributable
to:
Equity shareholders
of the Company 70.6 141.6 288.2
Other equity
holders 12.2 8.9 18.0
Non-controlling
interests - 2.1 2.8
---------------------- ------ -------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
82.8 152.6 309.0
---------------------- ------ -------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Earnings per
share
Basic 9 5.50p 10.94p 22.28p
Diluted 9 5.41p 10.72p 21.79p
---------------------- ------ -------------------- -------------------- -------- -------------------- -------------------- -------- -------------------- -------------------- --------
Condensed consolidated statement of comprehensive income
For the six months to 31 March 2016
6 months 6 months
to to Year to
31 March 31 March 30 September
2016 2015 2015
GBPm GBPm GBPm
--------------------------------------------- ----------- ----------- ---------------
Profit for the period 82.8 152.6 309.0
--------------------------------------------- ----------- ----------- ---------------
Items that will not be reclassified
subsequently to profit or loss
Remeasurement gain on defined benefit
pension schemes - - 10.7
Tax on net remeasurement gain on defined
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benefit pension schemes - - (2.1)
--------------------------------------------- ----------- ----------- ---------------
- - 8.6
--------------------------------------------- ----------- ----------- ---------------
Items that may be reclassified subsequently
to profit or loss
Translation of foreign currency net
investments 46.6 12.6 (8.5)
Available for sale assets:
- gains (losses) during the period 1.3 (0.5) 1.3
Tax on items that may be recycled
to profit or loss - - (0.3)
--------------------------------------------- ----------- ----------- ---------------
47.9 12.1 (7.5)
--------------------------------------------- ----------- ----------- ---------------
Other comprehensive income, net of
tax 47.9 12.1 1.1
Total comprehensive income for the
period 130.7 164.7 310.1
--------------------------------------------- ----------- ----------- ---------------
Attributable to:
Equity shareholders of the Company 118.5 153.7 289.3
Other equity holders 12.2 8.9 18.0
Non-controlling interests - 2.1 2.8
--------------------------------------------- ----------- ----------- ---------------
Condensed consolidated balance sheet
31 March 2016
31 March 31 March 30 September
2016 2015 2015
Notes GBPm GBPm GBPm
------------------------------------ -------- ----------- ----------- ---------------
Assets
Non-current assets
Intangible assets 11 1,525.3 1,492.6 1,486.2
Property, plant & equipment 23.0 21.3 21.3
Other investments 12 62.8 46.3 52.1
Deferred tax assets 20.5 25.1 19.9
Pension surplus 15 30.1 16.6 30.1
Trade and other receivables 4.0 3.6 3.7
------------------------------------ -------- ----------- ----------- ---------------
Total non-current assets 1,665.7 1,605.5 1,613.3
------------------------------------ -------- ----------- ----------- ---------------
Current assets
Assets backing investment
contract liabilities 13 1,706.0 2,920.4 1,926.1
Trade and other receivables 458.1 527.6 557.9
Other investments 12 247.3 112.9 192.6
Derivative financial assets 53.1 - 29.6
Cash and cash equivalents 401.4 566.6 567.7
Total current assets 2,865.9 4,127.5 3,273.9
------------------------------------ -------- ----------- ----------- ---------------
Total assets 4,531.6 5,733.0 4,887.2
------------------------------------ -------- ----------- ----------- ---------------
Equity
Called up share capital 131.8 133.1 131.8
Share premium account 898.7 898.7 898.7
Other reserves 723.6 658.8 675.7
Retained earnings (63.9) 9.9 30.3
------------------------------------ -------- ----------- ----------- ---------------
Total equity attributable
to shareholders of the parent 1,690.2 1,700.5 1,736.5
------------------------------------ -------- ----------- ----------- ---------------
Non-controlling interest (0.5) 35.7 (0.1)
7.0% Perpetual cumulative
capital notes 321.6 321.6 321.6
5.0% Preference shares 100.0 - 100.0
------------------------------------ -------- ----------- ----------- ---------------
Total equity 2,111.3 2,057.8 2,158.0
------------------------------------ -------- ----------- ----------- ---------------
Liabilities
Non-current liabilities
Deferred contingent consideration 59.5 57.1 46.8
Pension deficit 15 4.9 15.2 12.0
Provisions - 5.0 5.0
Deferred tax liabilities 96.4 99.6 92.7
------------------------------------ -------- ----------- ----------- ---------------
Total non-current liabilities 160.8 176.9 156.5
------------------------------------ -------- ----------- ----------- ---------------
Current liabilities
Investment contract liabilities 13 1,706.0 2,920.4 1,926.1
Trade and other payables 465.8 488.2 582.0
Other liabilities - 35.0 -
Current tax payable 35.4 54.7 34.9
Derivative financial liabilities 52.3 - 29.7
------------------------------------ -------- ----------- ----------- ---------------
Total current liabilities 2,259.5 3,498.3 2,572.7
------------------------------------ -------- ----------- ----------- ---------------
Total liabilities 2,420.3 3,675.2 2,729.2
------------------------------------ -------- ----------- ----------- ---------------
Total equity and liabilities 4,531.6 5,733.0 4,887.2
------------------------------------ -------- ----------- ----------- ---------------
Condensed consolidated statement of changes in equity
Share Non-
Share premium Other Retained controlling Other Total
For the six months to capital account reserves earnings interest equity equity
31 March 2016 GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
Balance at 1 October 2015 131.8 898.7 675.7 30.3 (0.1) 421.6 2,158.0
Profit for the period - - - 70.6 - 12.2 82.8
Other comprehensive income - - 47.9 - - - 47.9
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
Total comprehensive income - - 47.9 70.6 - 12.2 130.7
Share-based payments - - - 23.8 - - 23.8
Purchase of own shares - - - (34.4) - - (34.4)
Dividends paid to shareholders - - - (154.2) - (12.2) (166.4)
Non-controlling interest - - - - (0.4) - (0.4)
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
At 31 March 2016 131.8 898.7 723.6 (63.9) (0.5) 421.6 2,111.3
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
Share Non-
Share premium Other Retained controlling Other Total
For the six months to capital account reserves earnings interest equity equity
31 March 2015 GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
Balance at 1 October 2014 131.4 898.7 656.1 28.0 40.1 321.6 2,075.9
Profit for the period - - - 141.6 2.1 8.9 152.6
Other comprehensive income - - 12.1 - - - 12.1
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
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Total comprehensive income - - 12.1 141.6 2.1 8.9 164.7
Arising on the issue of
shares 1.7 - 65.7 - - - 67.4
Deferred share issue on
acquisition - - (67.6) - - - (67.6)
Share-based payments - - - 22.8 - - 22.8
Purchase of own shares - - - (39.6) - - (39.6)
Dividends paid to shareholders - - - (145.9) - (8.9) (154.8)
Unwinding of put option - - (7.5) 3.0 - - (4.5)
Non-controlling interest - - - - (6.5) - (6.5)
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
At 31 March 2015 133.1 898.7 658.8 9.9 35.7 321.6 2,057.8
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
Share Non-
Share premium Other Retained controlling Other Total
For the year to 30 September capital account reserves earnings interest equity equity
2015 GBPm GBPm GBPm GBPm GBPm GBPm GBPm
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
Balance at 1 October
2014 131.4 898.7 656.1 28.0 40.1 321.6 2,075.9
Profit for the period - - - 288.2 2.8 18.0 309.0
Other comprehensive income
(expense) - - (7.5) 8.6 - - 1.1
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
Total comprehensive income
(expense) - - (7.5) 296.8 2.8 18.0 310.1
Share-based payments - - - 45.4 - - 45.4
Deferred share issue
on acquisition - - (67.6) - - - (67.6)
Arising on the issue
of ordinary shares 1.8 - 65.8 - - - 67.6
Redemption of shares (1.4) - 1.4 (50.3) - - (50.3)
Issue of preference share
capital - - - (0.5) - 100.0 99.5
Purchase of own shares - - - (37.0) - - (37.0)
Dividends paid to shareholders - - - (243.2) - (18.0) (261.2)
Non-controlling interest - - - - (6.5) - (6.5)
Acquisition of non-controlling
interest - - 27.5 (8.9) (36.5) - (17.9)
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
At 30 September 2015 131.8 898.7 675.7 30.3 (0.1) 421.6 2,158.0
-------------------------------- ---------- --------- ----------- ----------- ------------- -------- ---------
Condensed consolidated cash flow statement
For the six months to 31 March 2016
6 months 6 months
to to Year to
31 March 31 March 30 September
2016 2015 2015
Notes GBPm GBPm GBPm
---------------------------------------------- -------- ---------- ---------- --------------
Core cash generated from operating
activities 114.3 227.4 531.7
Short-term timing differences on open
end fund settlements 5.1 (23.7) (1.3)
---------------------------------------------- -------- ---------- ---------- --------------
Cash generated from operations 119.4 203.7 530.4
Net interest received 0.9 1.4 2.1
Tax paid (25.7) (28.1) (62.2)
---------------------------------------------- -------- ---------- ---------- --------------
Net cash generated from operations 94.6 177.0 470.3
Acquisition-related costs paid (4.3) (10.4) (23.9)
---------------------------------------------- -------- ---------- ---------- --------------
Net cash generated from operating activities 5 90.3 166.6 446.4
---------------------------------------------- -------- ---------- ---------- --------------
Cash flows from investing activities
Proceeds from sale of investments 51.4 24.7 36.6
Purchase of investments (68.1) (41.7) (154.5)
Acquisition of businesses, net of cash
acquired (55.1) (43.4) (126.2)
Purchase of intangible assets (9.0) (1.4) (7.3)
Purchase of property, plant & equipment (4.2) (4.0) (8.5)
Net cash used in investing activities (85.0) (65.8) (259.9)
---------------------------------------------- -------- ---------- ---------- --------------
Cash flows from financing activities
Redemption issue of ordinary shares - - (50.3)
Purchase of own shares (34.4) (39.6) (37.0)
Issue of preference shares (net of
expenses paid) - - 99.5
Dividends paid and coupon payments (168.8) (157.1) (265.8)
Dividends paid to non-controlling interests - - (12.0)
---------------------------------------------- -------- ---------- ---------- --------------
Net cash used in financing activities (203.2) (196.7) (265.6)
---------------------------------------------- -------- ---------- ---------- --------------
Net decrease in cash and cash equivalents (197.9) (95.9) (79.1)
Cash and cash equivalents at beginning
of period 567.7 653.9 653.9
Effect of exchange rate fluctuations
on cash and cash equivalents 31.6 8.6 (7.1)
---------------------------------------------- -------- ---------- ---------- --------------
Cash and cash equivalents at end of
period 401.4 566.6 567.7
---------------------------------------------- -------- ---------- ---------- --------------
Notes to the interim condensed consolidated financial
statements
1 General information
The interim results have not been audited but have been reviewed
by the auditor. The condensed comparative figures for the financial
year to 30 September 2015 are not the company's statutory accounts
for that financial year. Those accounts have been reported on by
the company's auditor and delivered to the Registrar of Companies.
The auditor's report was unqualified and did not contain a
statement under section 498 of the Companies Act 2006.
2 Accounting policies
Basis of preparation
These condensed financial statements have been prepared in
accordance with IAS 34 Interim Financial Reporting as adopted by
the EU. The annual financial statements are prepared in accordance
with IFRS as adopted by the EU.
As required by the Disclosure and Transparency Rules of the
Financial Conduct Authority, the condensed financial statements
have been prepared applying the accounting policies and
presentation that were applied in the preparation of the Group's
published consolidated financial statements for the year ended 30
September 2015.
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The preparation of interim financial statements requires
management to make estimates and assumptions that affect the
reported income and expense, assets and liabilities and disclosure
of contingencies at the date of the interim financial statements.
Although these estimates and assumptions are based on management's
best judgement at the date of the interim financial statements,
actual results may differ from these estimates. The interim
financial statements, which are in a condensed format, do not
include all the information and disclosures required in the Group's
annual report, and should be read in conjunction with the Group's
annual report for the year ended 30 September 2015.
Going concern
The directors are satisfied that the Group has sufficient
resources to continue in operation for the foreseeable future, a
period of not less than twelve months from the date of this report.
Accordingly, it is appropriate to adopt the going concern basis in
preparing the condensed financial statements.
Segmental disclosures
The Group operates a single business segment of asset management
for reporting and control purposes.
IFRS 8 Operating Segments requires disclosures to reflect the
information which the Group management board ("GMB"), being the
body that is the Group's chief operating decision maker, uses for
evaluating performance and the allocation of resources. The Group
is managed as a single asset management business, with multiple
investment strategies of equities, fixed income and property,
complemented by a solutions business which provides multi asset,
alternatives and quantitative investment capabilities. These
strategies are managed across a range of products, distribution
channels and geographic regions. Reporting provided to the GMB is
on an aggregated basis.
3 Revenue
6 months 6 months Year to
to to 30 September
31 March 31 March 2015
2016 2015 GBPm
GBPm GBPm
--------------------------------------- ---------- ---------- --------------
Revenue comprises:
Gross management fees 534.9 675.2 1,296.8
Commissions payable to intermediaries (55.5) (77.9) (149.9)
---------------------------------------- ---------- ---------- --------------
Net management fees 479.4 597.3 1,146.9
Performance fees 1.5 3.4 13.5
Transaction fees 2.7 4.5 8.6
---------------------------------------- ---------- ---------- --------------
Net revenue 483.6 605.2 1,169.0
---------------------------------------- ---------- ---------- --------------
4 Acquisition-related items
Acquisition costs
Costs largely relate to the acquisition of SWIP and the
migration and integration of this business into the Group, as well
as deal costs related to acquisitions, which completed in the six
months to 31 March 2016 (see note 10). Transaction costs include
advisers' fees and stamp duty. Integration costs include charges in
respect of a transitional services agreement with the vendor to
ensure transfer in a controlled manner; set up costs in respect of
migration of the back office; and costs of retaining duplicate
staffing for the transitional period.
Transaction and deal costs on other acquisitions in 2015 relate
to advisers' fees on the FLAG Capital Management LLC acquisition
and in 2016 relate to Parmenion Capital Partners LLP, Arden and
Advance acquisitions (see note 10).
6 months 6 months Year to
to to 30 September
31 March 31 March 2015
2016 2015 GBPm
GBPm GBPm
------------------------------------ ---------- ---------- --------------
Arising on SWIP acquisition
Redundancy and other severance
costs - 3.7 3.8
Costs of separation, migration
& integration 2.0 10.5 16.4
Transitional service costs 0.2 3.2 2.8
Migration & integration costs 2.2 17.4 23.0
Transaction & deal costs - (3.0) (3.2)
Reduction in fair value of
deferred contingent consideration - - (24.4)
2.2 14.4 (4.6)
Arising on other acquisitions
Transaction & deal costs 0.8 - 4.7
Total acquisition-related
items 3.0 14.4 0.1
------------------------------------- ---------- ---------- --------------
5 Analysis of cash flows
6 months 6 months
to to Year to
31 March 31 March 30 September
2016 2015 2015
GBPm GBPm GBPm
---------------------------------------------- ---------- ---------- --------------
Reconciliation of profit after tax to
operating cash flow
Profit after tax 82.8 152.6 309.0
Depreciation 3.7 4.1 8.6
Amortisation of intangible assets 59.9 67.2 131.3
Unrealised foreign currency gains (3.0) (0.2) (1.9)
Other gains - - (23.1)
Loss on disposal of property, plant &
equipment - - 0.1
(Gains) losses on investments (6.1) 1.9 9.6
Equity settled share-based element of
remuneration 23.8 22.8 47.6
Net finance costs 0.3 1.7 4.0
Income tax expense 16.0 32.8 44.7
---------------------------------------------- ---------- ---------- --------------
177.4 282.9 529.9
Decrease (increase) in trade and other
receivables 31.1 (3.0) 24.5
Decrease (increase) in open end fund
receivables 157.5 (34.6) (101.8)
Decrease in trade and other payables (93.5) (62.9) (46.6)
(Decrease) increase in open end fund
payables (152.4) 10.9 100.5
Decrease in provisions (5.0) - -
Net cash inflow from operating activities 115.1 193.3 506.5
Net interest received 0.9 1.4 2.1
Income tax paid (25.7) (28.1) (62.2)
---------------------------------------------- ---------- ---------- --------------
Net cash generated from operating activities 90.3 166.6 446.4
---------------------------------------------- ---------- ---------- --------------
6 Net finance costs
6 months 6 months Year to
to to 30 September
31 March 31 March 2015
2016 2015 GBPm
GBPm GBPm
----------------------------------------------- ---------- ---------- --------------
Interest on overdrafts, revolving credit
facilities and other interest bearing
accounts
Unwinding of discount on deferred contingent 1.7 1.7 3.2
consideration
1.2 3.2 6.5
Total finance costs 2.9 4.9 9.7
Finance revenue - interest income (2.6) (3.2) (5.7)
----------------------------------------------- ---------- ---------- --------------
Net finance costs 0.3 1.7 4.0
----------------------------------------------- ---------- ---------- --------------
7 Tax expense
6 months 6 months Year to
to to 30 September
31 March 31 March 2015
2016 2015 GBPm
GBPm GBPm
-------------------------------------------- ---------- ---------- --------------
Current tax expense 24.9 42.4 66.5
Adjustments in respect of previous periods 0.8 (1.2) (2.7)
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Deferred tax credit (10.0) (9.0) (19.4)
Adjustments in respect of previous periods 0.3 0.6 0.3
-------------------------------------------- ---------- ---------- --------------
Total tax expense in income statement 16.0 32.8 44.7
-------------------------------------------- ---------- ---------- --------------
The tax charge for the six month period ended 31 March 2016 is
calculated using the expected effective annual tax rate in each
country of operation and applying these rates to the results of
each country for the first six months of the year.
8 Dividends and coupon payments
6 months 6 months
to to Year to
31 March 31 March 30 September
2016 2015 2015
GBPm GBPm GBPm
------------------------------------------ ---------- ---------- --------------
Coupon payments on perpetual capital
securities
7.0% Perpetual cumulative capital notes 12.1 11.2 22.6
------------------------------------------ ---------- ---------- --------------
Ordinary dividends
Declared and paid during the year:
Final dividend for 2015 - 12.0p (2014:
11.25p) 154.2 145.9 145.9
Interim dividend for 2015 - 7.5p - - 97.3
------------------------------------------ ---------- ---------- --------------
154.2 145.9 243.2
Preference dividends
5.0% Preference shares 2.5 - -
------------------------------------------ ---------- ---------- --------------
Total dividends and coupon payments paid
during the period 168.8 157.1 265.8
------------------------------------------ ---------- ---------- --------------
The interim ordinary dividend of 7.5p per share will be paid on
16 June 2016 to qualifying shareholders on the register at 13 May
2016.
9 Earnings per share
The calculations of earnings per share are based on the
following profits and numbers of shares.
Basic earnings per share amounts are calculated by dividing net
profit for the period attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding during the
period.
Diluted earnings per share amounts are calculated by dividing
the net profit for the period attributable to ordinary shareholders
by the weighted average number of ordinary shares outstanding
during the period plus the weighted average number of ordinary
shares that would be issued on the conversion of all the
potentially dilutive shares into ordinary shares.
Underlying earnings per share figures are calculated by
adjusting the profit to exclude amortisation of intangible assets
and acquisition-related items.
The purpose of providing the underlying earnings per share is to
allow readers of the accounts to clearly consider trends without
the impact of certain non-cash items or one-off items.
IAS 33 Underlying
-------------------------------------- --------------------------------------
6 months 6 months 6 months 6 months
to to Year to to to Year to
31 March 31 March 30 September 31 March 31 March 30 September
2016 2015 2015 2016 2015 2015
GBPm GBPm GBPm GBPm GBPm GBPm
-------------------------------- ---------- ---------- -------------- ---------- ---------- --------------
Basic earnings per share
Profit for the financial
period, attributable to
equity shareholders 70.6 141.6 288.2 70.6 141.6 288.2
Amortisation of intangible
assets, net of attributable
taxation 50.5 57.9 106.6
Acquisition costs, net of
attributable taxation 3.8 14.1 1.3
-------------------------------- ---------- ---------- -------------- ---------- ---------- --------------
Underlying profit for the
financial period 124.9 213.6 396.1
-------------------------------- ---------- ---------- -------------- ---------- ---------- --------------
Weighted average number
of shares (millions) 1,284.7 1,294.2 1,293.6 1,284.7 1,294.2 1,293.6
-------------------------------- ---------- ---------- -------------- ---------- ---------- --------------
Basic earnings per share 5.50p 10.94p 22.28p 9.72p 16.50p 30.62p
-------------------------------- ---------- ---------- -------------- ---------- ---------- --------------
Diluted earnings per share
Profit for calculation of
basic earnings per share,
as above 70.6 141.6 288.2 124.9 213.6 396.1
Weighted average number of shares
(millions)
For basic earnings per
share 1,284.7 1,294.2 1,293.6 1,284.7 1,294.2 1,293.6
Dilutive effect of exercisable
share options and deferred
shares 20.4 26.5 28.8 20.4 26.5 28.8
1,305.1 1,320.7 1,322.4 1,305.1 1,320.7 1,322.4
-------------------------------- ---------- ---------- -------------- ---------- ---------- --------------
Diluted earnings per share 5.41p 10.72p 21.79p 9.57p 16.17p 29.95p
-------------------------------- ---------- ---------- -------------- ---------- ---------- --------------
Profit for the period used in calculating earnings per share is
based on profit after tax after deducting non-controlling interest,
coupon payments in respect of perpetual capital securities (net of
tax) and preference dividends.
10 Acquisitions
a. On 29 December 2015, the Group completed the purchase of
Advance Emerging Capital Ltd ("Advance"), a London based specialist
investment manager. Total cash consideration for the transaction
was GBP14.6 million.
In the period to 31 March 2016, Advance added revenue of GBP0.8
million and profit before tax of GBP0.4 million. Had the
acquisition occurred on 1 October 2015, we estimate that
consolidated revenues would have increased by GBP1.6 million, and
consolidated profit before taxation for the period would have
increased by GBP0.5 million. In determining these amounts, we have
assumed that the fair value adjustments that arose on the
acquisition date would have been the same if the acquisition had
occurred on 1 October 2015.
Acquisition-related costs of GBP0.1 million were incurred and
have been included in acquisition-related costs (see note 4).
b. On 31 December 2015, the Group completed the purchase of
Arden Capital Management LLC ("Arden"), a hedge fund solutions
business with offices in New York and London. Total consideration
for this transaction was GBP11.2 million ($16.6 million),
comprising cash consideration of GBP10.4 million ($15.3 million)
and contingent consideration of GBP0.8 million under an earn-out
agreement.
The fair value of the earn-out at completion was GBP0.8 million,
determined by the probability weighted expected return and growth
over the period from acquisition to 31 December 2019, subject to a
maximum of GBP49 million ($73 million), and discounted to a present
value. The undiscounted fair values identified in this analysis
range from GBP1.5 million to GBP8.9 million. The deferred liability
is GBP0.8 million at 31 March 2016.
In the period to 31 March 2016, Arden added revenue of GBP2.6
million and profit before tax of GBPnil million. Had the
acquisition occurred on 1 October 2015, we estimate that
consolidated revenues would have increased by GBP5.8 million, and
consolidated profit before taxation for the period would have
increased by GBP0.1 million. In determining these amounts, we have
assumed that the fair value adjustments that arose on the
acquisition date would have been the same if the acquisition had
occurred on 1 October 2015.
Acquisition-related costs of GBP0.2 million were incurred and
have been included in acquisition-related costs (see note 4).
The acquisition of Advance and Arden are in line with the
Group's strategy to strengthen our alternatives capabilities.
c. On 11 January 2016, the Group completed the purchase of
Parmenion Capital Partners LLP and its sister company, Self
Directed Holdings Limited (together "Parmenion"), a Bristol based
provider of risk graded portfolios to UK financial advisers through
a digital platform. Total consideration for this transaction was
GBP49.8 million, comprising cash consideration of GBP39.7 million
and contingent consideration of GBP10.1 million under an
earn-out.
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The fair value of the earn-out at completion was GBP10.1
million, determined by the probability weighted expected return and
growth over the period from acquisition to 31 December 2017,
subject to a maximum of GBP16.8 million, and discounted to a
present value. The undiscounted fair values identified in this
analysis range from GBP8.0 million to GBP16.8 million. After the
impact of unwinding the discount to date of GBP0.3 million, the
deferred liability is GBP10.4 million at 31 March 2016.
The acquisition is in line with the Group's strategy to
capitalise on advancements in financial technology systems and to
become a leader in using technology to provide investors with
portfolios appropriate to their needs, whilst also growing its
Investment Solutions business.
In the period to 31 March 2016, Parmenion added revenue of
GBP2.2 million and profit before tax of GBP0.4 million. Had the
acquisition occurred on 1 October 2015, we estimate that
consolidated revenues would have increased by GBP4.8 million, and
consolidated profit before taxation for the period would have
increased by GBP1.1 million. In determining these amounts, we have
assumed that the fair value adjustments that arose on the
acquisition date would have been the same if the acquisition had
occurred on 1 October 2015.
Acquisition-related costs of GBP0.5 million were incurred and
have been included in acquisition-related costs (see note 4).
d. Independent valuation specialists were engaged to carry out a
valuation of the acquired goodwill and intangible assets acquired
in these transactions. The fair value adjustments from this
allocation process are reflected in the following table.
Goodwill is mainly attributable to the skills of the workforce
acquired and the synergies expected to be achieved from the
acquisitions.
The fair value of intangible assets has been based on the
present value of expected cash flows of the underlying management
contracts, with the exception of GBP11.6 million internally
developed software for Parmenion which is based on management's
best estimate of replacement cost.
The amounts recognised in respect of the identifiable assets and
liabilities assumed are as set out in the table below.
Business acquired Advance Emerging Arden Capital Parmenion Capital
from: Capital Ltd Management LLC Partners LLP
----------------- ---------------- ------------------
Fair value Fair value Fair value
GBPm GBPm GBPm
----------------------------- ----------------- ---------------- ------------------
Intangible assets 11.5 1.1 38.1
Property, plant &
equipment - 0.3 0.4
Deferred tax assets - 0.2 -
Trade and other receivables 0.5 82.9 1.5
Cash 0.8 7.3 1.5
Other investments - 1.5 -
Trade and other payables (0.6) (80.3) (2.3)
Current tax payable (0.1) - -
Deferred tax liabilities (2.3) (2.2) (7.6)
----------------------------- ----------------- ---------------- ------------------
Total identifiable
net assets acquired 9.8 10.8 31.6
Goodwill 4.8 0.4 18.2
----------------------------- ----------------- ---------------- ------------------
14.6 11.2 49.8
----------------------------- ----------------- ---------------- ------------------
Discharged by:
----------------------------- -------------------------------------------------------
Cash 14.6 10.4 39.7
Fair value of the
earn-out payment - 0.8 10.1
----------------------------- ----------------- ---------------- ------------------
Total consideration 14.6 11.2 49.8
----------------------------- ----------------- ---------------- ------------------
If information obtained within one year of the acquisition dates
about facts and circumstances that existed at acquisition date
identifies adjustments to the above amounts, or any additional
provisions that existed at acquisition date, then the accounting
for the acquisition will be revised.
11 Intangible assets
31 March 31 March 30 September
2016 2015 2015
GBPm GBPm GBPm
------------------- --------- --------- -------------
Intangible assets 558.1 578.3 553.4
Goodwill 967.2 914.3 932.8
------------------- --------- --------- -------------
1,525.3 1,492.6 1,486.2
------------------- --------- --------- -------------
Goodwill and intangibles are reviewed for impairment annually or
more frequently if there are indicators that the carrying value may
be impaired.
During the period to 31 March 2016, no impairments were
identified.
12 Other investments
31 March 31 March 30 September
2016 2015 2015
GBPm GBPm GBPm
---------------------------------------- --------- --------- -------------
Non-current assets
Non-current investments 62.8 46.3 52.1
---------------------------------------- --------- --------- -------------
Current assets
Seed capital investments 200.4 62.8 148.9
Investments in funds to hedge deferred
bonus liabilities 46.6 49.4 43.4
Other investments 0.3 0.7 0.3
247.3 112.9 192.6
---------------------------------------- --------- --------- -------------
Seed capital investments comprise amounts invested in funds when
the intention is to dispose of these as soon as practicably
possible.
13 Assets backing investment contract liabilities
These balances represent unit linked business carried out by the
Group's life assurance and pooled pensions subsidiary. The risks
and rewards of these assets fall to the benefit of or are borne by
the underlying policyholders. Therefore, the investment contract
liabilities shown in the Group's balance sheet are equal and
opposite in value to the assets held on behalf of the
policyholders. The Group has no direct exposure to fluctuations in
the value of assets which are held on behalf of policyholders, nor
to fluctuations in the value of the assets arising from changes in
market prices or credit default. The Group's exposure to these
assets is limited to the revenue earned, which varies according to
movements in the value of the assets.
14 Fair value of financial instruments
All financial instruments held by the Group are carried at fair
value. The following table provides an analysis of financial
instruments that are measured subsequent to initial recognition at
fair value, and grouped into levels 1 to 3 based on the degree to
which fair value is observable:
-- Level 1 measurements are derived from quoted prices
(unadjusted) in active markets for identical assets and
liabilities;
-- Level 2 measurements are derived from inputs other than
quoted prices included within level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices); and
-- Level 3 measurements are derived from valuation techniques
that include inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
31 March 2016
------------------------------------------- -------------------------------------
Level 1 Level 2 Level 3 Total
GBPm GBPm GBPm GBPm
------------------------------------------- -------- -------- -------- -------
Held for trading
Seed capital investments 164.6 35.8 - 200.4
Other investments 46.9 - - 46.9
Derivative financial assets
* Forward foreign exchange contracts - 53.1 - 53.1
Available for sale financial
assets
Other investments 4.3 - 40.5 44.8
Financial liabilities
Non-controlling interest
in consolidated funds (31.3) (2.7) - (34.0)
Deferred contingent consideration - - (59.5) (59.5)
Derivative financial liabilities
* Forward foreign exchange contracts - (52.3) - (52.3)
------------------------------------------- -------- -------- -------- -------
184.5 33.9 (19.0) 199.4
------------------------------------------- -------- -------- -------- -------
30 September 2015
------------------------------------------- ------------------------------------------
Level 1 Level 2 Level 3 Total
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GBPm GBPm GBPm GBPm
------------------------------------------- ---------- -------- ---------- --------
Held for trading
Seed capital investments 148.9 - - 148.9
Other investments 43.7 - - 43.7
Derivative financial assets
* Forward foreign exchange contracts - 29.2 - 29.2
* Equity futures 0.4 - - 0.4
Available for sale financial
assets
Other investments 3.2 - 31.4 34.6
Financial liabilities
Non-controlling interest
in consolidated funds (4.6) - - (4.6)
Deferred contingent consideration - - (46.8) (46.8)
Derivative financial liabilities
* Forward foreign exchange contracts - (29.7) - (29.7)
------------------------------------------- ---------- -------- ---------- --------
191.6 (0.5) (15.4) 175.7
------------------------------------------- ---------- -------- ---------- --------
The principal methods and assumptions used in estimating the
fair values of the financial instruments in the above tables
are:
Investments
The fair value of listed investments is based on market bid
prices at the balance sheet date without any deduction for
transaction costs.
Where investments are not listed, fair value is determined in
accordance with independent professional valuers or international
Private Equity and Venture Capital Valuation Guidelines where
relevant.
The fair value of unlisted investments in infrastructure funds
is based on the phase of individual projects forming the overall
investment and discounted cash flow techniques based on projected
earnings.
Non-controlling interest in consolidated funds
The Group recognises a non-controlling interest in seed capital
investments where the Group is deemed to have control, in
accordance with IFRS10 Consolidated Financial Statements. The fair
value of the non-controlling interest is determined on the same
basis as the investments listed above.
Derivative financial instruments
The Group enters into short term forward foreign exchange and
equity futures contracts to hedge its exposure to associated risks
in relation to certain seed capital investments.
Open forward foreign exchange contracts are valued using forward
rates of exchange applicable at the balance sheet date for the
remaining period until maturity, and are settled on a gross
basis.
All futures contracts were settled during the period, following
the disposal of the associated seed capital investments.
Fair value of deferred contingent consideration
As part of the consideration for the Arden and Parmenion
acquisitions during the period, there are performance related
earn-out payments. Further details of the fair value of each
earn-out are provided in note 10.
Reconciliation of Level 3 fair value measurements of financial
assets and liabilities
31 March 2016
-----------------------------------------
Available
for sale Deferred
financial contingent
assets consideration Total
GBPm GBPm GBPm
-------------------------------------- ------------ --------------- --------
Balance at 1 October 2015 31.4 (46.8) (15.4)
Assumed on acquisition
of Parmenion - (10.1) (10.1)
Assumed on acquisition
of Arden - (0.8) (0.8)
Total gains or losses:
* In income statement 0.6 - 0.6
* In other comprehensive income 2.5 (0.6) 1.9
Unwinding of discount through
profit or loss - (1.2) (1.2)
Purchases 9.1 - 9.1
Disposals (3.1) - (3.1)
Balance at 31 March 2016 40.5 (59.5) (19.0)
-------------------------------------- ------------ --------------- --------
Where applicable, transfers between levels are assumed to take
place at the beginning of the year. Seed capital investments and
associated non-controlling interests of GBP21.5 million, deemed not
to have been actively traded, were transferred from Level 1 to
Level 2 during the period. There were no other transfers between
Level 1, Level 2 or Level 3 investments during the period.
Investments classified as Level 3 principally comprise
investments in property and infrastructure funds. While the Group
is not aware of significant differences between the valuations
received and reasonable possible alternatives for the property
funds, the value of these investments would be directly impacted by
changes in the European and Asian property markets. The fair value
of the infrastructure funds would be impacted by a number of
factors described above.
The Group estimates that a 10% increase/decrease in the fair
value of investments will have a favourable/unfavourable impact on
equity of GBP4.1 million, of which GBP1.7 million relates to
investments in infrastructure funds.
The fair value of the earn-out agreements included in Level 3 is
determined based on a number of unobservable inputs. A change in
one or more of these inputs could result in a significant increase
or decrease in the fair value. On a standalone basis, without the
impact of those changes on other variables, changes in the discount
rate of +/- 1% would have an impact of approximately GBP0.9 million
and a change in revenue growth of +/- 10% would have an impact of
approximately GBP9.8 million on the fair value of the earn-outs
respectively.
15 Retirement benefits
The Group's principal form of pension provision is by way of
defined contribution schemes operated worldwide. The Group also
operates a number of legacy defined benefit schemes. There are two
schemes in the UK which are closed to new membership and to future
service accrual, plus schemes in Japan, Germany, Norway, Finland
and Thailand.
The actuarial valuations of the defined benefit pension schemes
referred to above were updated to 30 September 2015 by the
respective independent actuaries. Contributions to the schemes
since 30 September 2015 have been set off against the scheme
deficits.
31 March 31 March 30 September
2016 2015 2015
GBPm GBPm GBPm
-------------------------------------- --------- --------- -------------
Surplus in scheme at end of period 30.1 16.6 30.1
Deficits in schemes at end of period (4.9) (15.2) (12.0)
-------------------------------------- --------- --------- -------------
25.2 1.4 18.1
-------------------------------------- --------- --------- -------------
16 Contingent liabilities
The Group may, from time to time, be subject to claims, actions
or proceedings in the normal course of its business. When such
circumstances arise, the Board considers the likelihood of a
material outflow of economic resources and provides for its best
estimate of costs where an outflow of economic resources is
probable. While there can be no assurances, the directors believe,
based on information currently available to them, that the
likelihood of other material outflows is remote.
Responsibility statement
We confirm that to the best of our knowledge:
-- the condensed set of financial statements have been prepared
in accordance with IAS 34 Interim Financial Reporting as adopted by
the EU.
-- the interim management report includes a fair review of the information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being
an indication of important events that have occurred during the
first six months of the current financial year and their impact on
the condensed set of financial statements; and a description of the
principal risks and uncertainties for the remaining six months of
the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being
related party transactions that have taken place in the first six
months of the current financial year and that have materially
affected the financial position or performance of the entity during
that period; and any changes in the related party transactions
described in the last annual report that could do so.
For and on behalf of the Board
Scott E Massie
Secretary
10 Queen's Terrace
Aberdeen AB10 1YG
29 April 2016
Independent review report to Aberdeen Asset Management PLC
Report on the condensed consolidated financial statements
Our conclusion
We have reviewed Aberdeen Asset Management PLC's condensed
consolidated financial statements (the "interim financial
statements") in the interim report and accounts of Aberdeen Asset
Management PLC for the 6 month period ended 31 March 2016. Based on
our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in
all material respects, in accordance with International
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Accounting Standard 34, 'Interim Financial Reporting', as
adopted by the European Union and the Disclosure Rules and
Transparency Rules of the United Kingdom's Financial Conduct
Authority.
What we have reviewed
The interim financial statements comprise:
-- the condensed consolidated balance sheet as at 31 March 2016;
-- the condensed consolidated income statement and condensed
consolidated statement of comprehensive income for the period then
ended;
-- the condensed consolidated cash flow statement for the period then ended;
-- the condensed consolidated statement of changes in equity for the period then ended; and
-- the explanatory notes to the interim financial statements.
The interim financial statements included in the interim report
and accounts have been prepared in accordance with International
Accounting Standard 34, 'Interim Financial Reporting', as adopted
by the European Union and the Disclosure Rules and Transparency
Rules of the United Kingdom's Financial Conduct Authority.
As disclosed in note 2 to the interim financial statements, the
financial reporting framework that has been applied in the
preparation of the full annual financial statements of the Group is
applicable law and International Financial Reporting Standards
(IFRSs) as adopted by the European Union.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the directors
The interim report and accounts, including the interim financial
statements, is the responsibility of, and has been approved by, the
directors. The directors are responsible for preparing the interim
report and accounts in accordance with the Disclosure Rules and
Transparency Rules of the United Kingdom's Financial Conduct
Authority.
Our responsibility is to express a conclusion on the interim
financial statements in the interim report and accounts based on
our review. This report, including the conclusion, has been
prepared for and only for the company for the purpose of complying
with the Disclosure Rules and Transparency Rules of the United
Kingdom's Financial Conduct Authority and for no other purpose. We
do not, in giving this conclusion, accept or assume responsibility
for any other purpose or to any other person to whom this report is
shown or into whose hands it may come save where expressly agreed
by our prior consent in writing.
What a review of interim financial statements involves
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, 'Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity' issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK and
Ireland) and, consequently, does not enable us to obtain assurance
that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.
We have read the other information contained in the interim
report and accounts and considered whether it contains any apparent
misstatements or material inconsistencies with the information in
the interim financial statements.
PricewaterhouseCoopersLLP
Chartered Accountants
Edinburgh
29 April 2016
a) The maintenance and integrity of the Aberdeen Asset
Management PLC website is the responsibility of the directors; the
work carried out by the auditors does not involve consideration of
these matters and, accordingly, the auditors accept no
responsibility for any changes that may have occurred to the
interim financial statements since they were initially presented on
the website.
b) Legislation in the United Kingdom governing the preparation
and dissemination of financial statements may differ from
legislation in other jurisdictions.
Appendix - Assets under management and new business flows
Assets under management at 31 March 2016
30 September 31 December 31 March
2015 2015 2016
GBPbn GBPbn GBPbn
-------------------- ------------- ------------ ---------
Equities 80.1 77.5 78.3
Fixed income 65.6 66.6 66.9
Aberdeen solutions 119.0 127.1 128.0
Property 19.0 19.4 19.6
-------------------- ------------- ------------ ---------
283.7 290.6 292.8
-------------------- ------------- ------------ ---------
Fixed Aberdeen
Equities income solutions Property Total
GBPbn GBPbn GBPbn GBPbn GBPbn
---------------------------------- -------- ------- ---------- -------- ------
AuM at 30 September 2015 80.1 65.6 119.0 19.0 283.7
Net new business flows for
the period (9.8) (2.3) (5.6) 1.0 (16.7)
Corporate transactions - - 9.5 (1.7) 7.8
Market appreciation & performance 4.3 1.4 3.8 0.6 10.1
Exchange movements 3.7 2.2 1.3 0.7 7.9
AuM at 31 March 2016 78.3 66.9 128.0 19.6 292.8
---------------------------------- -------- ------- ---------- -------- ------
Overall new business flows for 6 months to 31 March 2016
3 months 3 months
to to 6 months to
31 December 31 March 31 March
2015 2016 2016
GBPm GBPm GBPm
--------------------- ------------- ---------- ------------
Gross inflows:
Equities 2,121 2,992 5,113
Fixed income 5,559 3,568 9,127
Aberdeen solutions 2,444 2,198 4,642
Property 791 1,784 2,575
--------------------- ------------- ---------- ------------
10,915 10,542 21,457
--------------------- ------------- ---------- ------------
Outflows:
Equities 8,470 6,462 14,932
Fixed income 5,127 6,255 11,382
Aberdeen solutions 5,713 4,569 10,282
Property 697 899 1,596
--------------------- ------------- ----------
20,007 18,185 38,192
--------------------- ------------- ---------- ------------
Net flows:
Equities (6,349) (3,470) (9,819)
Fixed income 432 (2,687) (2,255)
Aberdeen solutions (3,269) (2,371) (5,640)
Property 94 885 979
--------------------- ------------- ----------
(9,092) (7,643) (16,735)
--------------------- ------------- ---------- ------------
New business flows for 6 months to 31 March 2016 - Equities
3 months to 3 months to 6 months to
31 December 31 March 31 March
2015 2016 2016
GBPm GBPm GBPm
-------------------------- ------------- ------------ ------------
Gross inflows:
Asia Pacific 1,099 806 1,905
Global emerging markets 710 1,637 2,347
Europe 9 145 154
Global & EAFE 136 218 354
UK 51 40 91
US 116 146 262
-------------------------- ------------- ------------ ------------
2,121 2,992 5,113
-------------------------- ------------- ------------ ------------
Outflows:
Asia Pacific 2,969 2,205 5,174
Global emerging markets 1,639 1,571 3,210
Europe 42 188 230
Global & EAFE 3,678 2,245 5,923
UK 73 172 245
US 69 81 150
-------------------------- ------------- ------------ ------------
8,470 6,462 14,932
-------------------------- ------------- ------------ ------------
Net flows:
Asia Pacific (1,870) (1,399) (3,269)
Global emerging markets (929) 66 (863)
Europe (33) (43) (76)
Global & EAFE (3,542) (2,027) (5,569)
UK (22) (132) (154)
US 47 65 112
-------------------------- ------------- ------------ ------------
(6,349) (3,470) (9,819)
-------------------------- ------------- ------------ ------------
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New business flows for 6 Months to 31 March 2016 - Fixed
income
3 months 3 months 6 months
to to to
31 December 31 March 31 March
2015 2016 2016
GBPm GBPm GBPm
------------------- ------------- ---------- ----------
Gross inflows:
Asia Pacific 16 19 35
Australia 96 96 192
Convertibles 52 10 62
Emerging markets 174 231 405
Europe 60 26 86
Global 54 204 258
High yield 223 200 423
Money Market 3,573 2,373 5,946
UK 1,181 346 1,527
US 130 63 193
------------------- ------------- ---------- ----------
5,559 3,568 9,127
------------------- ------------- ---------- ----------
Outflows:
Asia Pacific 69 210 279
Australia 496 303 799
Convertibles 43 30 73
Emerging markets 355 1,126 1,481
Europe 364 42 406
Global 127 173 300
High yield 478 303 781
Money Market 1,805 2,331 4,136
UK 1,302 578 1,880
US 88 1,159 1,247
------------------- ------------- ---------- ----------
5,127 6,255 11,382
------------------- ------------- ---------- ----------
Netflows:
Asia Pacific (53) (191) (244)
Australia (400) (207) (607)
Convertibles 9 (20) (11)
Emerging markets (181) (895) (1,076)
Europe (304) (16) (320)
Global (73) 31 (42)
High yield (255) (103) (358)
Money Market 1,768 42 1,810
UK (121) (232) (353)
US 42 (1,096) (1,054)
------------------- ------ -------- --------
432 (2,687) (2,255)
------------------- ------ -------- --------
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR BSGDULUGBGLD
(END) Dow Jones Newswires
May 03, 2016 02:01 ET (06:01 GMT)
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