New business surges ahead at Gartmore
FUND manager Gartmore has seen a strong pick-up in new business over the first two months of the year, when it recorded higher net inflows than in the whole of 2009 following a December market listing.
Gartmore chief executive Jeffrey Meyer said net inflows for January and February were £273m, compared to a figure of £252m for the previous year period.
The group swung to a pre-tax profit of £47.6m last year, compared to a loss of £147m in 2008, in the heart of the financial crisis.
Meyer insisted that the group is reaping the benefits of its recent IPO, despite having seen a slide in its shares to under 200p after slashing the original offer price by a third to 220p due to investor jitters.
“We have achieved our objective of reducing debt [to £85m], positioning us to deliver our strategy for future growth,” said Meyer.
“It is our intention to reduce net debt to zero in the next few years through internal cash generation. We see no need to carry debt unless a value-creating opportunity arises.”
Assets under management also rose 19 per cent to £22.2bn last year, buoyed by the improvement in equity markets over the latter part of the year, though 2009 revenue dropped 7.6 per cent to £223.7m and cash earnings more than halved to £19.5m.
Gartmore expects to push forward with a muted hiring drive over the year, citing the importance of attracting, retaining and developing investment talent for the success of the business.
But Meyer said the firm remains cautious over the outlook for 2010. “Markets are volatile and a number of economic, political and regulatory issues still lack clarity,” he cautioned.