By Jonas Crosland, 06 November 2008
Man Group's shares fell over 25 per cent after the world's largest quoted hedge fund manager suffered a 9 per cent fall in assets under management during the period to $67.6bn.
What's more, poor returns on equity investments slashed net performance fee income by 44 per cent to $159m. However, the underlying picture looks less gloomy. First-half sales of $10.2bn outweighed redemptions of $6bn, and management and other fee income rose from $965m to $1,084m. AHL is Man's key investment fund, accounting for $24.4bn of funds under management and, although performance in the half showed a 7.8 per cent decline, this is still a 2.9 per cent gain since January 2008. AHL's performance in October was also impressive, rising 12 per cent. Man has maintained a strong balance sheet, boasting gross cash balances of $1.7bn and surplus regulatory capital of $1.5bn. Moreover, there's plenty of headroom on debt. Group debt facilities total $3.4bn of which $2.4bn remain unused.
Subject to revision, Evolution expects full-year pre-tax profits of $1.32bn and EPS of 62.2¢ ($2.12bn and 92.3¢ in 2008).
| MAN (EMG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 294p | MARKET VALUE: | £4,981.5m | |
| TOUCH: | 292-294p | 12-MONTH HIGH: | 626p | LOW: 286p |
| DIVIDEND YIELD: | 9.3% | PE RATIO: | 5 | |
| NET ASSET VALUE: | 265¢* | NET CASH: | $700m | |
More analysis of company results
More articles, comment and data on Man Group
IC VIEW:
Man's dividend has been maintained - meaning an impressive yield - and the balance sheet looks strong. Still, times are tough and likely to get worse as Man de-leverages on its investments, which will hit management fees, while redemptions continue. So, despite the undemanding forward PE ratio of 8, fairly priced.
Last IC view: Fairly priced, 333p, 29 September 2008.
visible-status-Public story-url-Man_Result_061108.xml