TIDMRAT
RNS Number : 3174D
Rathbones Group PLC
19 October 2022
Rathbones Group Plc
Third quarter trading update
Rathbones Group Plc ("Rathbones") announces a trading update for
the three months ended 30 September 2022.
Paul Stockton, Group Chief Executive of Rathbones, said:
"Despite challenging investment markets Rathbones has delivered
a resilient quarter, with annualised discretionary and managed net
organic growth of 3.3% and overall group investment performance
that compares well against industry benchmarks. Market movements in
investment values to 30 September 2022 adversely impacted total
FUMA however, which fell 1.7% in the quarter to GBP57.9 billion
against the MSCI PIMFA Private Investor Balanced Index, which fell
3.5% over the same period.
We continue to place a high priority on engaging meaningfully
with our clients, both face-to-face and digitally, and are on track
to deliver the first phase of our planned InvestCloud and Charles
River implementations by the end of 2022. Rathbones is
well-positioned to take advantage of the future growth
opportunities that can arise both during and after periods of
investment market volatility."
Highlights:
- Total funds under management and administration ('FUMA') were
GBP57.9 billion at 30 September (30 June 2022: GBP58.9 billion, 31
December 2021: GBP68.2 billion).
- GBP43.1 billion in the Investment Management business (30 June
2022: GBP43.8 billion, 31 December 2021: GBP50.3 billion).
- GBP10.6 billion in the Rathbone Funds business (30 June 2022:
GBP10.9 billion, 31 December 2021: GBP13.0 billion).
- GBP4.2 billion in Saunderson House (30 June 2022: GBP4.2
billion, 31 December 2021: GBP4.9 billion).
- Discretionary and managed net inflows were resilient at GBP0.4
billion (Q3 2021: GBP0.6 billion) in the quarter to 30 September
2022, representing an annualised growth rate of 3.3% (Q3 2021:
4.8%).
- Discretionary service net inflows totalled GBP0.3 billion (Q3 2021: GBP0.5 billion).
- Net inflows into our multi-asset fund range (a central part of
our managed offering to the adviser market) were strong, totalling
GBP0.1 billion and equating to annualised net growth for the period
of 17.4% (Q3 2021: GBP0.1 billion).
- Despite continued market volatility and significant outflows
across the wider asset management industry, net outflows in our
single strategy fund range remained low at GBP0.1 billion in the
quarter (Q3 2021: net inflows of GBP0.4 billion).
- Saunderson House integration is progressing well, with new
propositions launched during the quarter. Net outflows of GBP0.1
billion (Q3 2021: n/a) were in line with expectations.
- Our digital investment programme is progressing well with
planned releases of InvestCloud and Charles River on track for
delivery later this year. Functionality within MyRathbones, our
digital portal and app, has improved materially in 2022 supporting
engagement with both clients and advisers via easy-to-use data
sharing, messaging and reporting capabilities.
- Underlying net operating income was GBP113.0 million for the
three months ended 30 September 2022, an increase of 6.2% from the
GBP106.4 million for the three months ended 30 September 2021.
- Investment Management fees totalled GBP67.5 million (Q3 2021:
GBP72.8 million), reflecting lower FUMA on the principal charging
date.
- Commission income totalled GBP12.1 million, up 12.0% (Q3 2021:
GBP10.8 million) given increased trading volumes amid market
volatility.
- Net interest income increased materially, as expected, to
GBP5.6 million from GBP0.9 million in Q3 2021, reflecting UK base
rate rises during the year to date.
- Fees from advisory services and other income increased to
GBP12.4 million (Q3 2021: GBP4.9 million), reflecting organic
growth and the impact of the Saunderson House acquisition.
- Income in Rathbone Funds, which accrues daily, totalled
GBP15.4 million (Q3 2021: GBP17.0 million).
Full year results 2022
Results for the 12 months to 31 December 2022 will be announced
on 1 March 2023.
Detailed financial information
Net operating income:
3 months ended 9 months ended
30 September 30 September
2022 2021 Change 2022 2021 Change
Investment Management GBPm GBPm % GBPm GBPm %
- Fees 67.5 72.8 (7.3) 206.9 213.5 (3.1)
- Commissions 12.1 10.8 12.0 39.0 42.0 (7.1)
- Net interest income 5.6 0.9 522.2 11.6 3.3 251.5
- Fees from advisory services
(1) & other income 12.4 4.9 153.1 40.3 15.5 160.0
------ ------- -------- ------- -------- ---------
97.6 89.4 9.2 297.8 274.3 8.6
Rathbone Funds 15.4 17.0 (9.4) 47.1 45.7 3.1
-------
Net operating income 113.0 106.4 6.2 344.9 320.0 7.8
------ ------- -------- ------- -------- ---------
MSCI PIMFA Private Investor
Balanced Index on principal
charging dates (2) 1606 1781 (9.8) 1692 1754 (3.5)
(1) Including income from trust, tax, financial planning
services, Vision Independent Financial Planning and Saunderson
House.
(2) The principal charging dates for Investment Management
clients are 5 April, 30 June, 30 September and 31 December.
Rathbone Funds income accrues on daily levels of funds under
management.
Funds under management and administration
(i) Breakdown of FUMA and flows by service level
Service
Opening Level Market Closing Ann Net
Q3 ended 30 September FUM Inflows Outflows Net Flows Transfers Movement FUM Growth
2022 (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (%)
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Discretionary service 42,989 901 (613) 288 (52) (749) 42,476
Bespoke portfolios 41,745 851 (584) 267 (82) (737) 41,193 2.6
Managed via in-house
funds 1,244 50 (29) 21 30 (12) 1,283 6.8
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Multi-asset funds 1,931 164 (80) 84 - (42) 1,973 17.4
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total discretionary
& managed 44,920 1,065 (693) 372 (52) (791) 44,449 3.3
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Non-discretionary
service 832 4 (29) (25) (19) (24) 764 (12.0)
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total wealth management 45,752 1,069 (722) 347 (71) (815) 45,213 3.0
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Single-strategy funds 6,519 321 (433) (112) - (159) 6,248 (6.9)
Execution only & banking 2,432 31 (109) (78) 71 (108) 2,317 (12.8)
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total group (pre acquisitions) 54,703 1,421 (1,264) 157 - (1,082) 53,778 1.1
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Saunderson House 4,243 71 (161) (90) - (2) 4,151 (8.5)
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total group 58,946 1,492 (1,425) 67 - (1,084) 57,929 0.5
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Service
Opening Level Market Closing Ann Net
9 months ended 30 FUM Inflows Outflows Net Flows Transfers Movement FUM Growth
September 2022 (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (%)
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Discretionary service 49,249 2,585 (1,920) 665 (158) (7,280) 42,476
Bespoke portfolios 47,985 2,415 (1,846) 569 (252) (7,109) 41,193 1.6
Managed via in-house
funds 1,264 170 (74) 96 94 (171) 1,283 10.1
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Multi-asset funds 1,991 592 (287) 305 - (323) 1,973 20.4
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total discretionary
& managed 51,240 3,177 (2,207) 970 (158) (7,603) 44,449 2.5
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Non-discretionary
service 1,026 14 (67) (53) (77) (132) 764 (6.9)
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total wealth management 52,266 3,191 (2,274) 917 (235) (7,735) 45,213 2.3
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Single-strategy funds 8,316 1,308 (1,621) (313) - (1,755) 6,248 (5.0)
Execution only & banking 2,660 149 (340) (191) 235 (387) 2,317 (9.6)
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total group (pre acquisitions) 63,242 4,648 (4,235) 413 - (9,877) 53,778 0.9
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Saunderson House (3) 4,917 331 (543) (212) - (554) 4,151 (5.7)
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total group 68,159 4,979 (4,778) 201 - (10,431) 57,929 0.4
------------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
(3) Following a detailed review of Saunderson House flows data,
it was identified that Saunderson House net flows previously
reported for H1 2022 were overstated by GBP72m and market
performance was understated by GBP72m. This has now been reflected
in the YTD table above.
(ii) Breakdown of Rathbone Investment Management FUMA and flows
by channel
Service
Opening Level Market Closing Ann Net
Q3 ended 30 September FUM Inflows Outflows Net Flows Transfers Movement FUM Growth
2022 (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (%)
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total direct 32,814 641 (478) 163 (82) (551) 32,344 2.0
Total financial adviser
linked 10,175 260 (135) 125 30 (198) 10,132 4.9
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total discretionary
service 42,989 901 (613) 288 (52) (749) 42,476 2.7
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Execution only & banking 2,432 31 (109) (78) 71 (108) 2,317 (12.8)
Non-discretionary
service 832 4 (29) (25) (19) (24) 764 (12.0)
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total Investment Management 46,253 936 (751) 185 - (881) 45,557 1.6
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Service
Opening Level Market Closing Ann Net
9 months ended 30 FUM Inflows Outflows Net Flows Transfers Movement FUM Growth
September 2022 (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (GBPm) (%)
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total direct 37,800 1,739 (1,483) 256 (156) (5,556) 32,344 0.9
Total financial adviser
linked 11,449 846 (437) 409 (2) (1,724) 10,132 4.8
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total discretionary
service 49,249 2,585 (1,920) 665 (158) (7,280) 42,476 1.8
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Execution only & banking 2,660 149 (340) (191) 235 (387) 2,317 (9.6)
Non-discretionary
service 1,026 14 (67) (53) (77) (132) 764 (6.9)
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
Total Investment Management 52,935 2,748 (2,327) 421 - (7,799) 45,557 1.1
---------------------------- ------- ------- -------- --------- ---------- --------- ------- -------
(iii) Total Group FUMA
At 30 September At 30 June
----------------------------------------- ------------------------ ---------------
2022 2021 Change 2022 Change
-----------------------------------------
GBPm GBPm % GBPm %
----------------------------------------- ------- ------- ------ ------- ------
Rathbone Investment Management Gross
FUMA 45,557 51,335 (11.3) 46,253 (1.5)
Of which: discretionary wrapped funds(1) (2,403) (2,576) (6.7) (2,439) (1.5)
43,154 48,759 (11.5) 43,814 (1.5)
Rathbone Funds 10,624 12,143 (12.5) 10,888 (2.4)
Saunderson House 4,151 - - 4,243 (2.2)
----------------------------------------- ------- ------- ------ ------- ------
Total Group FUMA 57,929 60,902 (4.9) 58,945 (1.7)
----------------------------------------- ------- ------- ------ ------- ------
1. Discretionary wrapped funds represent funds operated by
Rathbone Funds, managed by both Rathbone Investment Management
teams and Rathbone Funds managers
The MSCI PIMFA Private Investor Balanced Index closed at 1597 on
18 October 2022, a decrease of 0.6% since 30 September 2022.
Investment Management fee income in the fourth quarter is dependent
upon the value of funds under management at 31 December 2022.
19 October 2022
For further information contact:
Rathbones Group Plc
Paul Stockton, Group Chief Executive
Jennifer Mathias, Group Chief Financial Officer
Shelly Patel, Head of Investor Relations
Tel: 020 7399 0071
email: shelly.patel@rathbones.com
Camarco
Ed Gascoigne-Pees
Julia Tilley
Tel: 020 3757 4984
email: ed.gascoigne-pees@camarco.co.uk
Rathbones Group Plc
Rathbones provides individual investment and wealth management
services for private clients, charities, trustees and professional
partners. We have been trusted for generations to manage and
preserve our clients' wealth. Our tradition of investing and acting
responsibly has been with us from the beginning and continues to
lead us forward. Our ambition is to be recognised as the UK's most
responsible wealth manager.
Rathbones has over 2,000 staff in 14 UK locations and Jersey;
its headquarters is 8 Finsbury Circus, London, EC2M 7AZ.
www.rathbones.com
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