Rathbone Brothers Rathbone Brothers Plc : 1st Quarter Results
May 18 2016 - 2:00AM
UK Regulatory
TIDMRAT
Rathbone Brothers Plc
Funds under management reach GBP29.3 billion
Rathbone Brothers Plc ("Rathbones") announces a trading update for the
period from 1 January 2016 to 31 March 2016.
At the Annual General Meeting later today, Mark Nicholls, Chairman of
Rathbones, will say:
"Volatile investment markets have presented challenges that are
reflected both in commission income and new business inflows for the
period to 31 March. The FTSE 100 index was 6091 on our 5 April 2016
billing date, down 2.4% from 31 December 2015, and 10.9% from a year
ago.
"Our growth initiatives remain important for us to maintain our position
as a leading discretionary wealth manager. Accordingly, the Board has
decided to pursue these longer term initiatives in spite of our
expectation that markets will continue to lack direction in the short
term. Rathbones remains alert to acquisition opportunities that may
arise as a consequence of these market conditions."
Highlights:
-- Total funds under management were GBP29.3 billion at the end of the first
quarter*, up 0.3% from GBP29.2 billion at 31 December 2015 and 1.4% from
GBP28.9 billion a year ago. In the first quarter, the FTSE 100 Index
decreased 2.4% and the FTSE WMA Balanced Index increased 0.2%.
-- Total net growth of funds under management in Investment Management was
GBP234 million, representing a total net annualised growth rate of 3.6%
(2015: 6.5%). This comprises acquired inflows of GBP134 million and net
organic growth of GBP100 million for the quarter. Net organic growth in
the first quarter represents an annualised growth rate of 1.5% compared
to 3.6% in the first three months of 2015.
-- Underlying net operating income in Investment Management of GBP53.5
million (2015: GBP54.7 million) was down 2.2% year on year in the first
three months of 2016. The FTSE 100 Index was 6091 on our 5 April billing
date, down 10.9% compared to 6834 on the same date in 2015. The FTSE WMA
Balanced Index, measured over the same period, decreased by 4.5%.
-- Fee income of GBP37.7 million (2015: GBP34.8 million) rose 8.3% year on
year in spite of lower markets, which reflects growth over the period and
tariff changes made in 2015.
-- Commission income of GBP9.8 million (2015: GBP14.4 million) was down
31.9% year on year, largely reflecting lower trading volumes and
settlement values, and a continuing trend towards higher quality fee
based income.
-- Net interest income of GBP2.8 million in the first three months of 2016
was up 7.7% on GBP2.6 million earned in the corresponding period in 2015.
Cash in client portfolios averaged GBP1.6 billion in the first quarter of
2016 (2015 average: GBP1.5 billion). Loans and advances to customers were
GBP121.3 million at 31 March 2016, up 3.4% on the GBP117.3 million at 31
December 2015.
-- Fees from advisory services and other income grew 10.3% from GBP2.9
million to GBP3.2 million, largely reflecting additional income from the
Vision group following its acquisition in 2015.
-- Funds under management in Unit Trusts increased 3.2% to GBP3.2 billion at
31 March 2016 from GBP3.1 billion at 31 December 2015, with net inflows
of GBP130 million during the quarter. Underlying net operating income of
GBP5.4 million (2015: GBP4.6 million) was up 17.4% year on year in the
first three months of 2016.
-- Development of the Rathbone Private Office ("RPO") advanced with the
agreement of an External Asset Manager relationship with Credit Suisse.
This arrangement will enable the RPO to offer a wealth advisory service
that has access to a full range of specialist private banking products,
services and lending solutions to complement Rathbones' own discretionary
fund management, tax, trust, financial planning and banking services.
* Funds under management at the end of the first quarter are measured at
5 April for Investment Management (to coincide with the first key
charging date for Investment Management private clients) and at 31 March
for Unit Trusts.
Net operating income
3 months ended 31 March
2016 2015 Change
Investment Management GBPm GBPm %
- Fees 37.7 34.8 8.3%
- Commissions 9.8 14.4 -31.9%
- Net interest income 2.8 2.6 7.7%
- Fees from advisory services(1) & other income 3.2 2.9 10.3%
53.5 54.7 -2.2%
Unit Trusts 5.4 4.6 17.4%
Net operating income 58.9 59.3 -0.7%
(1) Including income from trust, tax and advisory services.
Funds under management
(i) Investment Management Period ended 5 April(2)
2016 2015 Change
GBPm GBPm %
Opening FUM (1 January) 26,126 24,672
Inflows 616 812
Organic new business 482 635
Acquired new business 134 177
Outflows (382) (414)
Market effect and investment performance (210) 1,064
Closing FUM (5 April) 26,150 26,134 0.1%
Underlying annualised rate of net organic growth 1.5% 3.6%
Total annualised net organic and acquired growth 3.6% 6.5%
FTSE 100 Index (5 April) 6091 6834 -10.9%
FTSE WMA Balanced Index (5 April) 3538 3705 -4.5%
(ii) Unit Trusts 3 months ended 31 March
2016 2015 Change
GBPm GBPm %
Opening FUM (1 January) 3,073 2,520
Inflows 263 221
Outflows (133) (171)
Market effect and investment performance (35) 155
Closing FUM (31 March) 3,168 2,725 16.3%
Total funds under management(3) 29,318 28,859 1.6%
(2) Key charging dates for investment management clients are 5 April,
30 June, 30 September and 31 December. Unit trusts income accrues on
daily levels of funds under management.
(3) Includes GBP1,014 million (2015: GBP814 million) of execution only
funds.
The FTSE 100 Index closed at 6168 on 17 May 2016, a rise of 1.3% since 5
April 2016, which has increased the value of funds under management.
Investment management fee income in the first quarter is dependent upon
the value of funds under management at 5 April 2016.
Rathbone Brothers Plc's interim results for the six months to 30 June
2016 will be announced on 27 July 2016.
18 May 2016
For further information contact:
Rathbone Brothers Plc Camarco
Tel: 020 7399 0000 Tel: 020 3757 4984
email: shelly.chadda@rathbones.com email: ed.gascoigne-pees@camarco.co.uk
Philip Howell, Chief Executive Ed Gascoigne-Pees
Paul Stockton, Finance Director
Shelly Chadda, Investor Relations Manager
Rathbone Brothers Plc
Rathbone Brothers Plc ("Rathbones"), through its subsidiaries, is a
leading provider of high-quality, personalised investment and wealth
management services for private clients, charities and trustees. This
includes discretionary investment management, unit trusts, financial
planning, trust and company management and banking services.
Rathbones has over 1,000 staff in 15 UK locations and Jersey, and
currently has its headquarters in Curzon Street, London.
rathbones.com http://www.rathbones.com
This announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: Rathbone Brothers Plc via Globenewswire
HUG#2013389
http://www.rathbones.com/
(END) Dow Jones Newswires
May 18, 2016 02:00 ET (06:00 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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