Brooks Macdonald Group PLC Trading Update (7222C)
January 24 2018 - 2:00AM
UK Regulatory
TIDMBRK
RNS Number : 7222C
Brooks Macdonald Group PLC
24 January 2018
24 January 2018
BROOKS MACDONALD GROUP PLC
Half Year Trading Update and Quarterly Announcement of Funds
under Management
Notice of Half Year Results
Brooks Macdonald Group plc (the "Group"), the AIM listed
investment management group, today publishes its Trading Update for
its half year ended 31 December 2017, together with a quarterly
update on its Discretionary Funds Under Management.
In the period, we completed the sale of our Braemar Estates
property business, as announced at our annual results in September
2017.
Half Year Trading Update
Funds under Management ("FUM") have risen by 12.3% over the last
six months, ending the period at GBP11.7 billion (30 June 2017:
GBP10.5 billion). This compared to a rise in the MSCI WMA Balanced
Index of 4.3%. Net organic growth over the period was 7.7%, with
rates of growth remaining strong in UK Investment Management,
whilst the International business showed improving growth compared
to the year to June 2017.
The revenue impact of higher FUM over the period has been
offset, partly by lower yields. This is principally due to
continued movements in product mix, the competitive environment
including the ongoing shift towards all-in fees, and reduced
transactional income against a background of lower market
volatility in the period. Further, we have continued to invest in
our regulatory change agenda (in particular, MiFID II and GDPR), as
previously disclosed.
We continue to exercise cost discipline, alongside our
previously stated focus on growing our business sustainably and
delivering medium-term margin improvement.
Overall, the anticipated outcome for the financial year remains
in line with management's expectations.
Quarterly Funds under Management Update
As at 31 December 2017, discretionary FUM totalled GBP11.7
billion, an increase of 6.8% over the quarter (30 September 2017:
GBP11.0 billion). As a comparison the WMA Balanced Index increased
by 3.5%.
This growth was a combination of performance (GBP319m) and net
new business (GBP431m) over the quarter, compared to GBP474m from
performance and GBP808m from net new business for the half
year.
Analysis of discretionary fund flows over the quarter and half
year
Quarter to 31 December Half Year to 31 December
2017 2017
--------------------------- -----------------------------
GBPm UK IM BMI TOTAL UK IM BMI TOTAL
------------------ --------- ------ -------- ---------- ------ ---------
Opening FUM 9,404 1,584 10,987 8,927 1,529 10,456
------------------ --------- ------ -------- ---------- ------ ---------
Net new business 396 36 431 724 83 808
------------------ --------- ------ -------- ---------- ------ ---------
Performance 271 48 319 418 55 474
------------------ --------- ------ -------- ---------- ------ ---------
Closing FUM 10,070 1,668 11,738 10,070 1,668 11,738
------------------ --------- ------ -------- ---------- ------ ---------
Organic growth 4.2% 2.3% 3.9% 8.1% 5.4% 7.7%
------------------ --------- ------ -------- ---------- ------ ---------
Total growth 7.1% 5.3% 6.8% 12.8% 9.1% 12.3%
------------------ --------- ------ -------- ---------- ------ ---------
Notice of Half Year Results
The Group intends to issue its Half Year Results on Wednesday 14
March 2018. Given ongoing levels of IT investment, we will include
software amortisation in our calculation of underlying profit from
the Half Year Results onwards.
Caroline Connellan, Chief Executive of Brooks Macdonald
commented:
"I am pleased to report that in our second quarter we have
maintained the good momentum seen in the first quarter. Our focus
on our client and adviser relationships has supported strong net
new business which, combined with good portfolio performance, has
resulted in substantial FUM growth across all areas of our
business."
"Our strong FUM trajectory, combined with a disciplined approach
to costs, means we are well placed to mitigate external pressures
on revenue yield."
"We continue to make good progress with our planned investment
in our operational and risk management framework to build a
stronger, sustainable platform for the business. This will enable
us to take full advantage of the significant growth opportunities
open to us, whilst enhancing efficiency and delivering improved
operating margins in the medium term."
This information is provided by RNS
The company news service from the London Stock Exchange
END
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