22nd Jan 2009 07:02
ABERDEEN ASSET MANAGEMENT PLC
INTERIM MANAGEMENT STATEMENT - 3 MONTHS TO 31 DECEMBER 2008
Highlights
Assets under management little changed at £110.2 billion (30 September 2008: £111.1 billion)
£2.6 billion of new business won in the quarter. Improved fee rates on new business
Good progress on Credit Suisse acquisition
Martin Gilbert, Chief Executive of Aberdeen, commented:
"I am pleased to report resilient performance from Aberdeen in Q1 of our financial year. The fact that our assets under management have remained broadly the same since the end of September is a tribute to the diversity and scale of the business.
"We continue to make good progress on a number of fronts. We are reducing our cost base in response to the weak market environment, while our plans to acquire certain businesses from Credit Suisse are progressing well. Underpinning all this is our continued performance in many areas, including emerging markets and global equities.
"Market conditions remain extremely challenging but Aberdeen is well placed to come through these times in good shape and to continue to take advantage of opportunities as they arise."
Global equity, bond and property markets remain volatile and we see no early end to this situation. However, difficult markets bring opportunities and we finished the quarter under review with the announcement of an acquisition which strengthens Aberdeen's position as a major global asset manager and which provides further potential for growth when market conditions improve.
Assets under management ("AuM") at 31 December 2008 were little changed at £110.2 billion (30 September 2008: £111.1 billion), as the effects of markets, performance and currency movements broadly matched the Group's new business flows. In particular, Aberdeen has benefited from a global diversified client base predominantly invested in non-sterling holdings. The principal changes in AuM over the quarter are shown in the following table.
|
|
Equities & fixed income
£m
|
Property
£m
|
Total
£m
|
|
AuM at 30 September 2008
|
85,749
|
25,385
|
111,134
|
|
Net new business
|
(5,454)
|
464
|
(4,990)
|
|
Corporate transactions
|
-
|
(1,238)
|
(1,238)
|
|
Market movements, performance & FX
|
2,853
|
2,426
|
5,279
|
|
AuM at 31 December 2008
|
83,148
|
27,037
|
110,185
|
Uncertainty surrounding the outlook for global economies and markets continues to weigh upon investors' decisions when it comes to allocating funds and reducing existing exposure to stocks and securities in favour of cash. Gross new business wins for the quarter totalled £2.6 billion, compared to £5.2 billion for the same period last year, with a further £3.1 billion of new mandates which had been awarded but not funded at 31 December (and therefore not included in AuM at that date). Assets withdrawn by clients during the quarter totalled £7.6 billion (quarter to 31 December 2007: £5.1 billion), resulting in net outflows for the quarter of £5.0 billion (quarter to 31 December 2007: net inflow £0.1 billion).
Analysis of these flows is provided in the tables at the end of this statement, from which it is clear that the net outflows have arisen within the fixed income funds whereas the higher margin equities and property asset classes have experienced net inflows. The average fee rate on inflows during the quarter is approximately 46 basis points, while for outflows in the quarter the average fee rate is approximately 27 basis points.
Investment performance remains extremely good across a wide range of equity disciplines, with the global equities, global emerging markets, Asia Pacific and US teams all delivering numbers which are consistently ahead of the respective benchmarks. Fixed income performance remains difficult as US credit, in particular, continue to be affected by illiquidity and the consequences of deleveraging in the financial sector. In a testing year for property performance, leveraged funds have suffered, but some good asset management results have provided resilience across a range of separate account mandates.
The cost reduction proposals announced during 2008 continue to progress in accordance with our expectations. One element of these proposals involved the sale of our Belgian property business and this was completed in November, resulting in a reduction of £1.2 billion in AuM, as reflected in the table above. The integration of the enlarged property division following the two acquisitions completed in 2008 is also proceeding according to plan, with the people who joined as part of the Goodman Property Investors transaction having transferred to the Group's London office at the end of November.
Since we announced the business and capital alliance with Mitsubishi UFJ Trust & Banking Corporation ("MUTB") in October, we have been working with MUTB to undertake the preparatory work necessary for the successful marketing of certain Aberdeen products into the Japanese institutional market. We look forward to the longer term opportunities that this relationship will bring.
On 31 December, we announced the proposed acquisition of certain businesses from Credit Suisse Global Investors and a separate general meeting will be held in due course for the purpose of seeking shareholder approval of this transaction. In the meantime we have made good progress in establishing the global and regional project teams necessary to ensure an efficient transition. We will be working closely with Credit Suisse in the period up to closing to ensure that the business can migrate to Aberdeen's platform in a controlled manner thereafter.
We have seen continuing volatility in global markets and we envisage that market conditions across the asset management industry will remain very difficult for some time to come, both in terms of market performance and new business flows. However, we remain confident that we have the financial strength, a strong range of core products and a diversified client base to weather the current turbulent environment and on which to build once investor confidence returns.
For further information please contact:
Aberdeen Asset Management PLC + 44 (0) 20 7463 6000
Martin Gilbert
Bill Rattray
Maitland + 44 (0) 20 7379 5151
Neil Bennett
Georgina Pepys
ASSETS UNDER MANAGEMENT AT 31 DECEMBER 2008
|
|
31 Dec 08
£m
|
30 Sep 08
£m
|
|
By type of mandate:
|
|
|
|
Institutional mandates
|
82,443
|
84,013
|
|
Open end funds (excluding property funds)
|
8,851
|
9,998
|
|
Closed end funds (excluding property funds)
|
5,127
|
5,253
|
|
Property funds
|
13,764
|
11,870
|
|
|
110,185
|
111,134
|
|
By asset class:
|
|
|
|
Fixed income
|
46,324
|
46,950
|
|
Equities
|
30,739
|
32,582
|
|
Property
|
27,037
|
25,385
|
|
Multi asset
|
6,085
|
6,217
|
|
|
110,185
|
111,134
|
OVERALL NEW BUSINESS FLOWS - 3 MONTHS TO 31 DECEMBER 2008
|
|
Qtr to 31 Dec 08
£m
|
Qtr to 31 Dec 07
£m
|
|
Gross inflows:
|
|
|
|
Equities
|
1,288
|
1,321
|
|
Fixed income
|
673
|
2,807
|
|
Property
|
586
|
859
|
|
Multi asset
|
53
|
265
|
|
|
2,600
|
5,252
|
|
Outflows:
|
|
|
|
Equities
|
1,247
|
2,885
|
|
Fixed income
|
6,062
|
1,844
|
|
Property
|
122
|
175
|
|
Multi asset
|
159
|
206
|
|
|
7,590
|
5,110
|
|
Net flows:
|
|
|
|
Equities
|
42
|
(1,564)
|
|
Fixed income
|
(5,389)
|
963
|
|
Property
|
464
|
684
|
|
Multi asset
|
(106)
|
59
|
|
|
(4,990)
|
142
|
NEW BUSINESS FLOWS FOR 3 MONTHS TO 31 DECEMBER 2008 - EQUITIES
|
|
Qtr to 31 Dec 08
£m
|
Qtr to 31 Dec 07
£m
|
|
Gross inflows:
|
|
|
|
Asia Pacific
|
412
|
677
|
|
Global emerging markets
|
383
|
297
|
|
Europe
|
2
|
18
|
|
Global & EAFE
|
318
|
233
|
|
Specialist
|
43
|
25
|
|
UK
|
24
|
25
|
|
US
|
106
|
46
|
|
|
1,288
|
1,321
|
|
Outflows:
|
|
|
|
Asia Pacific
|
549
|
2,256
|
|
Global emerging markets
|
223
|
153
|
|
Europe
|
19
|
45
|
|
Global & EAFE
|
78
|
65
|
|
Specialist
|
140
|
43
|
|
UK
|
51
|
143
|
|
US
|
187
|
180
|
|
|
1,247
|
2,885
|
|
Net flows:
|
|
|
|
Asia Pacific
|
(137)
|
(1,579)
|
|
Global emerging markets
|
160
|
144
|
|
Europe
|
(17)
|
(27)
|
|
Global & EAFE
|
240
|
168
|
|
Specialist
|
(98)
|
(18)
|
|
UK
|
(27)
|
(118)
|
|
US
|
(81)
|
(133)
|
|
|
42
|
(1,564)
|
NEW BUSINESS FLOWS FOR 3 MONTHS TO 31 DECEMBER 2008 - FIXED INCOME
|
|
Qtr to 31 Dec 08
£m
|
Qtr to 31 Dec 07
£m
|
|
Gross inflows:
|
|
|
|
Asia Pacific
|
107
|
369
|
|
Emerging markets
|
23
|
301
|
|
Europe
|
106
|
125
|
|
Global
|
15
|
355
|
|
High yield
|
25
|
132
|
|
UK
|
168
|
856
|
|
US
|
229
|
669
|
|
|
673
|
2,807
|
|
Outflows:
|
|
|
|
Asia Pacific
|
798
|
553
|
|
Emerging markets
|
246
|
123
|
|
Europe
|
549
|
39
|
|
Global
|
958
|
424
|
|
High yield
|
37
|
131
|
|
UK
|
1,256
|
307
|
|
US
|
2,218
|
268
|
|
|
6,062
|
1,844
|
|
Net flows:
|
|
|
|
Asia Pacific
|
(690)
|
(184)
|
|
Emerging markets
|
(223)
|
178
|
|
Europe
|
(444)
|
86
|
|
Global
|
(943)
|
(69)
|
|
High yield
|
(12)
|
1
|
|
UK
|
(1,088)
|
548
|
|
US
|
(1,989)
|
401
|
|
|
(5,389)
|
963
|
Note: figures in the tables above may appear not to add due to rounding differences
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