F&C slashes costs to keep profits afloat

 
Michael Bow
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COST cutting and better margins helped money manager F&C Asset Management increase profits last year, despite clients pulling £13.3bn from the company, it said yesterday.

The group, under the guiding hand of turnaround specialist Edward Bramson, said underlying profit before tax over the year ending December 2012 went up to £52.4m, from £47m.

Both assets under management and revenue fell over the period and the group only generated a profit due to sharp reductions in costs.

The company is currently implementing a two stage strategic review, aimed at trimming costs and generating more business.

Yesterday it said it had slashed underlying operating costs by £30m, or some 14 per cent, down to £172.1m by reducing expenses across the board. Underlying operating margin rose to 29.2 per cent from 24.4 per cent.

This cushioned a big loss of assets from insurer Friends Life, which pulled £5.3bn of assets last year.

However, Bramson said the firm was now well placed for future growth. The Australian hired F&C stalwart Richard Wilson as chief executive earlier this year.

Yesterday he said growing the business would fall to Wilson but Bramson gave no hint if he would sell out his 20 per cent stake.