Wealth manager sees funds rise 7.7% to £47.5bn, despite ‘ongoing uncertainties’
Funds under management and administration at Liverpool wealth management firm Rathbone Brothers increased 7.7% in the first quarter, to £47.5bn.
A trading update for the three months ended March 31, today, also revealed that underlying net operating income was £85.3m during the quarter, up 13.1% from £75.4m from the same period last year.
Chief executive Philip Howell said: “In spite of ongoing political and economic uncertainties, our operating income in the first quarter increased 13.1% to £85.3m, reflecting the impact of recent acquisitions and a 10.7% increase in the FTSE 100 Index since 31 December 2018.
“The integration of Speirs & Jeffrey is proceeding well as we continue to focus on the successful transfer of clients to the Rathbones platform.
“Accordingly, we expect the operational performance targets in respect of the initial contingent consideration to be met very shortly and ahead of our original schedule.
“Total funds under management and administration increased 7.7% to reach a new high of £47.5bn during the quarter.”
He added: “Whilst we expect weak investor sentiment to continue in the short term, we continue to provide our clients with quality investment and advice solutions whilst pursuing future growth opportunities.”
Total net organic and acquired growth in investment management was £130m during the quarter, compared with £199m a year ago, representing a total net annualised growth rate of 1.4%, down from 2.4% last year.
Net organic growth principally reflected ongoing weak investor sentiment and the anticipated muted growth from Speirs & Jeffrey, while their focus remains on integration.
As a result, net organic growth in the first quarter represents an annualised growth rate of 0.1% compared with 2.0% in the first three months of 2018.
Net operating income of £76.8m in investment management for the first quarter of 2019 was 15.3% higher than the £66.6m for the comparable period in 2018.
Funds under management in unit trusts grew 8.9% to £6.1bn at March 31, 2019, from £5.6bn at December 31, 2018.
Although net inflows of £59m during the quarter were lower than the £142m posted in the prior year, Rathbone’s said this was a positive result amid an industry backdrop of negative net retail sales.
Net operating income of £8.5m for the three months ended March 31, 2019, was marginally lower than the £8.8m for the comparable period in 2018 as managers’ box dealing profits ceased from mid-January 2019.
