Schroders reports smaller than expected dip in AuM

5th Nov 2015 07:40

(ShareCast News) - Schroders saw profitability jump in the nine months to September 2015 alongside a sharp rise in net inflows at its Asset Management, with assets under management holding up better than expected in the third quarter. Total inflows rose by £8.3bn in the first nine months of the year, with the lion´s share or £8.1bn going into Asset Management and the remainder towards Wealth Management, the company said in a statement.The fund manager´s boss, Michael Dobson, said: "In the first nine months of the year profit before tax increased to £438.9m and we generated £8.3bn of net new business. These results reflect the resilience of our diversified business at a time of heightened market volatility."Paul McGinnis at Shore Capital was more critical, telling clients that: "Q3 update shows net outflows but profitability holding up. [...] Period-end assets under management (AuM) of £294.8bn (company-collated consensus: £297.1bn) were down £15.1bn (4.9%) since 30th June (£309.9bn), which split down as Q3 net outflows of -£0.5bn (0.2%) and negative market movements of -£14.6bn (4.7%).""While we regard Schroders as a high quality asset manager, with a well-diversified AuM base (by geography and by asset class) and a very strong balance sheet, we prefer the business models of those asset managers who have a greater ability to monetise periods of strong investment performance via a performance fee mechanism," McGinnis added.Total profits before tax for the nine-month period increased 21% to £438.9m.Before exceptional items, profits were higher by 12% to £453.2m.Total net revenues rose 7% to £1,190.1m and assets under management by another 7% to £294.8m.