Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Rathbones' AUM on brink of £20bn driving profits up 17%

Rathbones' AUM on brink of £20bn driving profits up 17%

Rathbones’ pre-tax profits rose by 17.2% in the first half of the year as asset growth of 10.6% pushed its assets under management to the brink of £20 billion.

Profit before tax rose to £23.2 million over the six months to the end of June, up from £19.8 million in the period last year as assets reached £19.9 billion, prompting the board to increase Rathbones' interim dividend by 5.8% to 18p.

Rathbones’ discretionary business saw assets under management rise by 9.3% on annualised growth rate basis to reach £780 million. The company said the acquisition of Taylor Young added £358 million to its private client book and stripping this out the division achieved £327 million of net organic growth, equivalent to 3.9% on an annualised basis.

Rathbones’ fund arm saw net inflows of £67 million in the first half, more than double the £32 million investors’ poured into its range in the same period last year, which pushed its total unit trust assets up to £1.44 billion, with the unit generating £5.1 million of profit, up 15.9% from £4.4 million year-on-year.

Chief executive Andy Pomfret (pictured) said: ‘Rathbones' outlook remains positive. Our continued focus on client service and controlled investment in people and systems ensures that Rathbones is well placed to take advantage of healthier investment markets and future growth opportunities.’

The firm’s operating expenses rose 13.6% to £62 million, which it said ‘largely reflects salary inflation’, with average salaries rising by 4.4%, a 5.8% increase in headcount to 821 to 776 and the £800,000 cost of new offices it opened in Newcastle and Lymington.

The group also injected a further £2 million into its pension scheme after pouring in an additional £3.6 million in the second half of last year.

Rathbones’ ongoing legal action in Jersey looks set to cost more than expected. Initially anticipated to cost around £1 million, the group said it had spent £0.8 million on legal fees arising in the first half as in connection with its proceedings to confirm insurance cover against the insurers of the excess layer of professional indemnity policy and the related proceedings in Jersey.

It said: ‘These costs are likely to increase in the second half, not least because the trial of the insurance claim will start on 7 October 2013.’

Rathbones' shares were broadly flat in early morning trading, down 0.36% or 6p at 1,664p.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play HSBC's Stephen King warns of 'enormous' Brexit deficit danger

HSBC's Stephen King warns of 'enormous' Brexit deficit danger

Brexit will weaken the economy, fail to boost exports and lessen the country's ability to fund its 'enormous' deficit, according to HSBC's senior economic adviser Stephen King.

Play Premier's Smith: electricity and water can be a good mix

Premier's Smith: electricity and water can be a good mix

Exposing your person to electricity and water simultaneously is ill-advised, but what about your portfolio?

Play Citywire 10k: video highlights

Citywire 10k: video highlights

Citywire held its sixth annual charity run last week, which hosted over 200 people and raised £14,000. Here are the video highlights.

Your Business: Cover Star Club

Profile: gearing up for the shift from consolidation to start-ups

Profile: gearing up for the shift from consolidation to start-ups

‘I think the industry is evolving rapidly, but not necessarily as a whole,’ says the head of recently launched Charles Nicholson AM

Wealth Manager on Twitter