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Aberdeen suffers £8.8 billion outflow

by Dylan Lobo on May 06, 2014 at 08:01

Aberdeen Asset Management believes the future is looking brighter for emerging markets after the group suffered sharp half-year outflows.

In the six months to March 2014 net outflows stood at £8.8 billion, a big swing from an inflow of £4.4 billion in the corresponding period of 2013.

This hurt revenue, which was down from £516 million to £503.5 million, while underlying pretax profit was off 3% at £217 million.

Total assets under management rose from £212.3 billion to £324.5 billion, although this was heavily distorted by the acquisition of Swip. Excluding this assets fell by 5% to £190.4 billion.  

Despite the tough conditions the firm stuck to its dividend commitment, raising the payout by 12.5% to 6.75p a share.

The group attributed the outflows to 'weaker investment sentiment' in emerging markets.

However, Aberdeen chief executive Martin Gilbert (pictured) sees signs of a turn in sentiment, which when coupled with the acquisition of Swip, leaves him confident for the second half.  

'Aberdeen has delivered a resilient set of numbers in this half year, given the difficult backdrop for emerging markets. Our disciplined investment approach, long-term investment track record and tradition of client service have enabled us to limit equity outflows whilst we have continued to win mandates in other asset classes, such as fixed income and property,' Gilbert told the market.

'There are signs of a pick-up in sentiment towards emerging economies, as investors are again identifying opportunities and recognising the fundamental strengths of these markets. Equally encouraging is the healthy improvement in the relative performance of our key equity products so far this year.

'At the end of March we were delighted to complete our acquisition of Swip and the process of integrating the business is proceeding as planned. The deal adds scale and strengthens further our broad range of investment capabilities and confirms Aberdeen's position as one of the world's leading asset management groups."

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