M&G hailed “good progress” in the first six months of the year today as profits surged ahead of City predictions despite volatility still roiling the market and denting its assets under management.
The London-listed investor said its assets had tumbled to £332.8bn at the end of June, down from £342bn at the end of last year, despite the flow of cash into its funds beginning to tick back up.
Investors added some £0.7bn to its funds in the six month period, a partial reversal after its net flows cratered to £0.3bn in the back six months of 2022 when spooked investors shunned the market amid the turmoil triggered by war in Ukraine. Analyst had bet on outflows of £2.2bn for the period.
Adjusted operating profits also sailed past the City’s predictions of £284m and surged 31 per cent to £390m.
The figures come as chief Andrea Rossi marks nearly a near at the helm of the investment firm in which he has looked to slash costs and boost the flow of cash into its funds after years of outflows.
In a statement this morning, Rossi said the numbers reflected the “underlying strength of our business model” and “resilience of our balance sheet”.
Making good progress on capital generationCEO Andrea Rossi
“Against the backdrop of ongoing market volatility and uncertainty we have made progress against all three pillars of the strategy that we launched in March – maintaining our financial strength through capital discipline; mobilising the Transformation programme to simplify our business and improve client outcomes; and delivering growth with positive net client inflows,” he added.
M&G bosses said this morning they had managed to soften an expected flood of outflows in the wake of the mini-budget crisis last year by adding funds to its wholesale asset management and wealth arms in the period.
The figures come after a turbulent year for money managers in which managed assets have tumbled and investors have fled the market in the wake of war in Ukraine.
Rossi said the firm remained on track to achieve its operating capital generation target of £2.5bn by end 2024, and was “making good progress” on its 2025 targets, which include generating £200m of cost savings and reducing its core asset manager cost/income ratio to sustainably lower than 70 per cent.
The update came as M&G appointed to new bosses with Caroline Connellan joining as new Wealth CEO, and Clive Bolton as new Life Insurance CEO, both joining the firm this month.