25th Nov 2019 08:27
(Alliance News) - Polar Capital Holdings PLC said on Monday its first half was "challenging" with outflows continuing.
Assets under management at September 30, the end of London-based Polar's first half, were GBP14.3 billion, up 3.6% from the figure at March 31. At the end of October, AuM was GBP14.0 billion.
Polar said net outflows of GBP400 million were offset by a market uplift as well as a fund performance of GBP900 million.
Pretax profit dipped 8.8% to GBP24.9 million, and Polar has kept the interim dividend flat on the year before at 8.0 pence per share.
"The past six months have been challenging. Active equity strategies have seen continued outflows, and equity funds as a whole have experienced record outflows into bonds, but these have been dwarfed by buybacks and M&A which have supported public markets," said Chief Executive Gavin Rochussen.
"Positioning and sentiment surveys remain cautious, with reported cash positions at high levels and equities underweight."
The biggest contributor to net outflows during the half was Polar's Japan Fund, and the company has made changes to the team following "sustained" underperformance. The Japan Fund has since been merged with the Japan Value Fund.
Since September, Polar said short-term investment performance and net fund outflows have continued to be challenging.
"October and November have seen a moderate rise in markets as a consequence of further monetary easing by the [US] Federal Reserve and monetary stimulus by the ECB. This has had the impact of lifting markets but has not, as yet, increased the appetite for active equities," it said.
"Across the UK and Europe, our core markets, retail active equity fund sales have been negative every month since October 2018."
Shares were 3.7% lower on Monday morning in London at a price of 526.00 pence each.
By George Collard; [email protected]
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