7th May 2020 12:17
(Alliance News) - Rathbone Brothers PLC said Thursday its funds under management & administration fell over the first quarter but believes its business model is "robust".
At April 5, the wealth manager held GBP42.65 funds under management & administration, down 15% from GBP50.40 at December 31 and 10% lower from the same point the year before.
Rathbone said its Investment Management unit first quarter period was measured from January 1 to April 5 to coincide with the first charging date of the unit's private clients.
Rathbone recorded GBP653 million in net inflows in the period, but this was offset by a GBP7.54 billion investment loss.
Rathbone noted its performance was "resilient" considering the FTSE 100 Index fell 27.4% in the first quarter, while the MSCI PIMFA Private Investor Balanced Index decreased by 17.3%
The Investment Management unit held GBP35.88 funds under management & administration, down 17% from GBP42.97 at December 31 and 13% lower from the same point the year before. Total Discretionary funds contracted 15% over the first quarter to GBP33.69 billion.
Rathbone's Unit Trust funds slipped 9.0% over the first quarter to GBP6.77 million at March 31 from GBP7.44 billion at December 31. The funds are up 11% on the same point the year before, however.
"I am very proud of the way our people and infrastructure have responded to the Covid-19 crisis. Our business model is robust and has rapidly adjusted to ways of working remotely whilst continuing to provide clients with quality service, investment solutions and advice, at a time when they need it most," Chief Executive Paul Stockton said.
Underlying net operating income was down slightly year on year to GBP84.6 million from GBP85.3 million. A 9.7% drop in Fees income was offset by a 29% jump in Commission income.
Stockton noted the second quarter has started "well", with April seeing GBP400 million of net inflows. At the end of April, total funds under management & administration stood at GBP46.5 billion, up 9.2% from April 5.
He continued: "There remains a great deal of uncertainty around the duration and severity of the pandemic, and we expect that global market conditions will remain volatile and interest rates low. Our balance sheet remains strong, and we are well positioned to continue with our strategic growth agenda, mindful of the necessity to balance the needs of the business with market conditions and the health and well-being of our employees."
Shares in Rathbone Brothers were 1.9% higher in London on Thursday at 1,488.00 pence each.
By Paul McGowan; [email protected]
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