Schroders beats expectations to set new record

Michael Bow
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FUND manager Schroders rose to a record share price high yesterday after beating market expectations to deliver a big rise in annual profits.

The blue-blooded money manager, led by chief executive Michael Dobson, saw shares close up over five per cent at £27.27 a share.

Earlier in the day, Dobson had unveiled a 24 per cent rise in pre-tax profits for 2013, comfortably beating expectations from market analysts.

Increased appetite from individual savers for Schroders’ stock funds and from pension funds for multi asset products helped drive inflows but Dobson struck a cautious tone after the results on the year ahead.

“We think high-quality equities are still the place to be but we’re not projecting the same kind of performance as we saw last year,” he warned.

The company reported strong performance fees of just over £70m, but Dobson said this would fall down to its normal level of about £50m in future. A £4.6bn net inflow from institutional investors and £4.8bn inflow from retail investors helped push up the performance fees. Overall revenues rose 24 per cent to £1.4bn in a busy year for the company which saw it buy rival fund managers Cazenove Capital and STW Fixed Income.

The departure of star fund manager Richard Buxton hit the firm with big withdrawals but Dobson said yesterday the outflows had tailed off and were no longer an issue.