Schroders interim profit beats expectations

30th Jul 2015 09:11

(ShareCast News) - Asset manager Schroders posted better-than-expected first half profit, on the back of strong demand for its fixed income products.For the six months to 30 June, adjusted for the costs of previous acquisitions, the group reported a 17% year-on-year rise in pre-tax profits to £305.7m, exceeding its estimate of £300m.Net flows of new cash into the FTSE 250's group funds, which include equity and multi-asset commodity-focused funds, almost doubled to £8.8bn, beating expectations for a £8.1bn reading, while assets under management rose 14% to £309.9bn."In the first half of 2015 despite heightened volatility in markets towards the end of the period, net inflows were particularly strong in fixed income and, regionally, in Asia Pacific and Continental Europe," said group chief executive Michael Dobson.In a statement released on Thursday, the group said net revenue in its asset management division rose 12% from the previous year to £694.3m, while revenue in its wealth management arm climbed 5% to £105.5m.However, the group warned that in the short term, with continuing uncertainty in the Eurozone and China and the prospect of interest rate rises in the US, market volatility is likely to remain high which may impact retail investor demand in particular.Schroders said it will pay an interim dividend of 29p per share, a 21% higher from the one it paid in the corresponding period 12 months ago."We continue to believe that Schroders is a dull and boring company, which is precisely why we think it is interesting as a long term investment," analysts at Numis said in a note.Schroders shares were up 1.81% to 3,148.00p at 0831 BST on Thursday.