Join +750K new investors every month who copy stock picks from billionaire's portfoliosSign Up Free

Fund manager Ashmore's profit up despite emerging market sell-off

Published 08/09/2015, 09:15
© Reuters.  Fund manager Ashmore's profit up despite emerging market sell-off
UK100
-
ASHM
-
ADNl
-

By Nishant Kumar

LONDON (Reuters) - Emerging markets money manager Ashmore Group (L:ASHM) reported a rise in profit and revenue for the year ending June, benefiting from a rise in performance fees, cost cuts and a stronger U.S. dollar, sending shares in the UK-based firm higher on Tuesday.

The improvement came despite a 21 percent drop in its assets under management (AUM) as investors asked for their money back due to uncertainty over the health of the Chinese economy and the prospect of an interest rate hike in the United States.

Profit before tax rose 6 percent to 181.3 million pounds, while net revenue increased 8 percent to 283.3 million pounds, Ashmore said in a statement. Assets under management fell to $58.9 billion from $75 billion a year ago on the emerging markets sell-off, which has rattled rivals such as Aberdeen Asset Management (L:ADN).

"With the events in China really taking the centre stage and grabbing the headline, sentiments and client appetite is weaker again," said Chief Financial Officer Tom Shippey.

"It pushes out the flows recovery by another couple of months or so until some stability returns and people get a handle on where value is apparent and where future returns are likely to come from," he added.

At 0754 GMT, Ashmore's shares were up 5 percent, outperforming 1.5 percent gain by the FTSE 100 Index (FTSE).

Portfolio losses led to $6 billion reduction in its AUM, while net outflows accounted for $9.5 billion during the period. More than half of the outflow was due to a small number of relatively large account redemptions, the firm said.

Performance fees earned rose by more than four times to 13.3 million pounds as the alternative funds it managed were unaffected by the sell-off.

The firm, which earns a majority of its fees in U.S. dollars, benefited from the currency's strength, leading to a foreign exchange gain of 18.5 million pounds, up from a 30.1 million pound loss the previous year.

Ashmore, which said Peter Gibbs will succeed Michael Benson as the firm's chairman next month, proposed a final dividend of 12.1 pence a share and said 60 percent of its AUM was outperforming benchmarks over three years.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.