24th Mar 2005 07:01
Aberdeen Asset Management PLC24 March 2005 ABERDEEN ASSET MANAGEMENT PLC TRADING UPDATE Ahead of entering the close period prior to the announcement of interim resultsfor the six months to 31 March 2005, to be issued on 3 May 2005, Aberdeen AssetManagement issues the following trading update. The healthy levels of new business generation reported in the 2004 Annual Reporthave continued in the new financial year and assets under management at 28February 2005 were £24.9 billion, which represents an increase of 12.6% on theposition at 30 September 2004. The Group's gross new business for the 5 months to 28 February, includingmandates awarded but not yet funded, totalled £2.1 billion. Net new business forthe same period totalled £1.4 billion, as follows: Funded Yet to fund Total £m £m £mNet inflows to open-end funds 573 - 573Segregated account mandates 371 65 436Closed-end funds 164 - 164 --------- ---------- --------Total fund management division 1,108 65 1,173Net inflows to property open-end funds 207 - 207 --------- ---------- --------Group total 1,315 65 1,380 --------- ---------- -------- The new business flows reported above include inflows from investors in Europe,North America, the Middle East and the Asia Pacific region as well as theaddition of a new UK investment trust mandate for The New India InvestmentTrust. Since the end of February we have also seen the announcement of ourappointment as one of the two new managers of the F & C Pacific InvestmentTrust, which will add further to assets under management in due course. The property management division continues to develop and has achieved veryhealthy inflows into its Norwegian property fund, with good progress also beingmade on a similar Danish property fund. This division is well positioned to addfurther assets under management from a number of initiatives currently underdevelopment and we are making good progress towards introducing a partner whocan provide the additional resources required to properly seed these newinitiatives. Investment performance remains strong across all of the Group's disciplines,reflecting the benefits of the wider implementation of the process which hadalways been adopted by our Asia Pacific team. For the 12 month period to 28February 2005 over 86% by value of the Group's open-end funds delivered 1st or2nd quartile performance and 55% by value of the closed-end funds outperformedtheir respective benchmarks over the same period. The benefit of the income streams from the new business flows is reflected in animproving operating margin. We continue to pay close attention to operatingcosts and, having achieved our previously stated targets, our focus will be ondelivering further efficiencies in this area. We have successfully completed disposals of several non-core assets and haveused the cash proceeds to pay down debt. Although the gearing ratio increasedfollowing the announcement of the voluntary settlement of the split capitalissues the recent £26.6 million convertible bond issue and agreement of a £50million revolving credit facility with Bank of Scotland provide a comfortablelevel of financial resources. The proposed issue of up to £125 million of apreferred security will further strengthen the balance sheet. The recent announcement by Britannic Group PLC that it is to acquire CenturyGroup will lead to a reduction in assets under management of approximately £1.5billion. However, the income from the contract with Century represented only2.1% of the Group's fund management income last year and the strength of newbusiness inflows means that we expect the lost revenue will be replaced quickly.We will have the additional benefit of receiving cash proceeds of £11.3 millionfrom the redemption of our investment in Century's preference shares when thecontract terminates. The Uplift Plan offered to investors in the Aberdeen Progressive Growth UnitTrust, for which we made provision in the results to 30 September 2004, has beenwell received and we have received acceptances from investors representingapproximately 87% by value of those entitled to participate, with furtheracceptances continuing to come in from those who hold their investment throughnominees. The acceptance numbers include all three of the lead case complaintswhich had been under review by the Financial Ombudsman Service ("FOS") and over82% of all complaints submitted to FOS. We believe that this now allows us todraw a line under the split capital episode. The only remaining legacy issue is the dispute with Real Estate OpportunitiesLimited ("REO") over the termination of Aberdeen's management contract withoutnotice. We have provided full disclosure of the circumstances surrounding thisdispute in previous Annual Reports. Although REO has yet to take any of theaction that it has repeatedly threatened, we believe that it is likely that REOwill issue proceedings. Aberdeen would welcome the opportunity to have thisclaim litigated in court and the Board is resolute in its belief that REO has noproper cause for complaint. Aberdeen will continue to vigorously defend theclaim and, if proceedings are brought by REO, will pursue a substantialcounterclaim for outstanding fees and compensation for breach of the terminationprovisions of up to £17 million. The Board, on the basis of legal advice,remains of the view that there is no need to make any provision in respect ofany action threatened by REO. For further information: Neil Bennett Maitland 020 7379 5151 ABERDEEN ASSET MANAGEMENT PLC ASSETS UNDER MANAGEMENT AT 28 FEBRUARY 2005 28 Feb 05 30 Sep 04 £m £mBy type of mandate:Institutional funds 13,082 11,821Unit trusts and open end funds 5,718 4,555Investment trusts and closed end funds 5,315 4,966Private portfolios 415 393Private equity 358 363 --------- ---------- 24,888 22,098 --------- ----------By asset class:Equities: UK 7,042 6,740 Asia Pacific 5,238 4,006 North America 1,191 1,215 Europe 1,143 994 Japan 676 560 Emerging markets 245 266 --------- ---------- 15,535 13,781Fixed interest & cash 5,080 4,405Property 4,273 3,912 --------- ---------- 24,888 22,098 --------- ---------- This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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