Rathbones' Funds Under Management Grow 8.6% To £23.9 Billion
This statement is a half-yearly financial report in accordance with the UK Listing Authority’s Disclosure and Transparency Rules. It covers the six month period ended 30 June 2014.
Philip Howell, Chief Executive of Rathbone Brothers Plc, said:
“The first six months of this year have been a busy and exciting period for Rathbones in which we have announced two acquisitions and a successful placing. We are pleased to have removed the uncertainty associated with the long-running legal proceedings, and believe that joining a settlement to do so is in the best commercial interests of the company.
“Notwithstanding relatively flat markets total net growth in funds under management was £1.5 billion in the first half of 2014, representing an annualised growth rate of 14.3% compared to 9.4% in the first half of 2013 and representing continued momentum both from organic and acquired growth. Including the impact of market movements, Rathbones’ total funds under management at 30 June 2014 were £23.9 billion.
“The impact of recent acquisitions is expected to have a positive effect on earnings in 2015. We are continuing to invest carefully in the skills and systems required to achieve our growth objectives. Rathbones’ outlook therefore remains positive.”
- Total funds under management at 30 June 2014 were £23.9 billion, up 8.6% from £22.0 billion at 31 December 2013. This compared to a decrease of 0.1% in the FTSE 100 Index and an increase of 1.0% in the FTSE WMA (formerly APCIMS) Balanced Index over the same period.
- Total net organic and acquired growth in the funds managed by Rathbone Investment Management was £1.2 billion in the first six months of 2014, representing a net annual growth rate of 12.2% (2013: 9.3%). Net organic growth of £417 million for the first half represents an underlying annualised rate of net organic growth of 4.1% (2013: 3.9%). We have now completed the acquisition of part of Deutsche Asset & Wealth Management’s London-based private client investment management business, which added £617 million of funds under management by 30 June 2014. The acquisition of the private client and charity investment management business of Jupiter Asset Management is expected to complete at the end of the third quarter, when funds under management will transfer to Rathbone Investment Management.
- Profit before tax was £30.9 million for the six months ended 30 June 2014, up 33.2% compared to £23.2 million in 2013. Underlying profit before tax (excluding charges in relation to client relationships and goodwill, gain on disposal of financial securities and transaction costs) increased 13.4% from £26.1 million to £29.6 million, representing a margin of 30.2% (2013: 29.6%).
- Earnings per share increased 33.7% to 51.6p (2013: 38.6p). The weighted average number of ordinary shares, used to calculate earnings per share, increased 2.0% from 45.6 million at 30 June 2013 to 46.5 million at 30 June 2014, largely as a result of the placing of 2.9% of the then issued share capital in April 2014.
- The board recommends a 19p interim dividend for 2014 (2013: 18p), an increase of 5.6% on 2013.
Underlying operating income in Investment Management of £90.8 million in the first six months of 2014 (2013: £83.0 million) was up 9.4%. The average FTSE 100 Index was 6720 on our quarterly billing dates in 2014, compared to 6233 in 2013, an increase of 7.8%.
- Net interest income of £4.4 million in the first six months of 2014 has increased 4.8% from £4.2 million in 2013 largely due to an increase in average liquidity from £1.0 billion at 31 December 2013 to £1.1 billion at 30 June 2014 and more client lending.
- Underlying operating expenses of £68.5 million for the six months ended 30 June 2014 were up 10.5% on £62.0 million in the first half of 2013 largely as a result of business growth. Funds under management in Rathbone Unit Trust Management were £2.2 billion at 30 June 2014 (31 December 2013: £1.8 billion). Net inflows of £338 million in the first half of 2014 have increased from £67 million in 2013. Underlying operating income in Rathbone Unit Trust Management was £7.3 million in the six months ended 30 June 2014, an increase of 43.1% from £5.1 million in the first half of 2013.
- Late on 23 July 2014 the company joined into a conditional agreement to contribute £15 million to a settlement of legal proceedings in Jersey involving a former director and employee of a former subsidiary, Rathbone Trust Company Jersey Limited and in respect of legal proceedings against certain of Rathbones’ civil liability (professional indemnity) insurers.
You can read the full Interim Management Statement here
Issued on 24 July 2014
For further information contact:
Rathbone Brothers Plc
Tel: 020 7399 0000
Mark Nicholls, Chairman
Philip Howell, Chief Executive
Paul Stockton, Finance Director
Tel: 020 7466 5054
Rathbone Brothers Plc
Rathbone Brothers Plc is a leading provider of high-quality, personalised investment and wealth management services for private clients, charities and trustees. This includes discretionary investment management, unit trusts, tax planning, trust and company management, pension advice and banking services.
Rathbones has over 850 staff in 13 UK locations and Jersey, and has its headquarters in Curzon Street, London.