29th Jan 2014 09:26
LONDON (Alliance News) - Liontrust Asset Management PLC Wednesday said it recorded a GBP50 million net inflow in the third quarter, but admitted it would have recorded a GBP73 million net outflow without the addition of its new multi-asset team last October.
In a statement, the asset manager said it recorded a GBP50 million net inflow for the three months to December 31, compared with GBP64 million in the corresponding quarter last year.
However, that figure includes the GBP123 million of net inflows relating to Liontrust's October 2013 acquisition of North Investment Partners Ltd.
The outflows were mainly a result of one investor in the Liontrust Global Strategic Bond Fund redeeming GBP106 million, while an institutional investor redeemed GBP39 million from the UK Retail funds.
Chief Executive John Ions said the two client withdrawals were "lower margin institutional-type business".
Liontrust said its assets under management increased by GBP196 million to GBP3.57 billion in the third quarter.
"Assets under management increased a further 6% in the fourth quarter of 2013, and we believe our profitability, excluding performance fee profits, in the current financial year will be in line with expectations," Ions said in a statement.
He said the underlying fund flows - excluding the North Investment Partners GBP123 million inflow and the two large withdrawals - remained positive.
"Assets under management in UK retail funds has passed through GBP2.5 billion and strong interest in our funds is shown by the fact that nearly 200 professional advisers and fund buyers came to our recent Annual Investment Conference," he said.
However, UK Retail actually saw a GBP16 million net outflow but rose to GBP2.59 billion from GBP2.46 billion as a result of a positive market and investment performance, which added GBP143 million to the final sum.
Ions admitted that overall fund performance in 2013 was "not as strong on a relative basis" because US quantitative easing had boosted "lower quality stocks".
Quantitative easing has seen the US Federal Reserve and the Bank of England buy up fixed-income assets from the market in order to give a boost to the economy in the years after the 2008 financial crisis.
However, uncertainty over the Federal Reserve's 'tapering' - which will see a gradual reduction of the policy over the coming months - has spooked some investors.
In December the Federal Reserve reduced its asset purchase programme by USD10 billion a month, leaving it at GBP75 billion a month.
The US central bank is at 1900 GMT Wednesday set to say whether it will further taper its own asset purchase programme this month.
"Our investment processes have proved their ability to deliver attractive returns to our investors over the long term, and we continue to believe that this strict adherence to process will be rewarded as QE is withdrawn and there is a return to an increased focus on company fundamentals," Ions said.
"The increasing interest in our range of funds and our very strong long-term performance give us confidence that we will maintain the growth of our business over the coming months and years."
Liontrust shares were Wednesday quoted at 267.00 pence, down 2.50 pence, or 0.9%.
By Samuel Agini; [email protected]; @samuelagini
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