Investment manager Ashmore delivered a creditable half-year performance in the face of volatile financial markets, helped in part by its significant exposure to investments in emerging markets debt, where returns have been less badly affected.
Even so, assets under management (AUM) fell from $65.8bn in June to $60.4bn (£38.5bn) at the end of 2011 entirely as a result of market weakness, although there was still a net $0.7bn net inflow of funds in the period. Inevitably, this led to a sharp fall in performance fees, which declined from £60.1m to £23m, although some of this reflected a change in product mix that reduced the number of AUM eligible to earn performance fees from 38 per cent to 32 per cent of the total. Crucially, the all-important management fee income rose 30 per cent to £151m due to the higher levels of average AUM compared with 12 months earlier and a stronger US dollar. Average management fee revenue margins did decline from 86 to 76 basis points, but this was down to a change in theme and client mix.
The profit performance was 15 per cent better than Numis Securities had expected and 8 per cent better than consensus, so the broker plans to upgrade full-year EPS estimates of 22.3p by around 5 to 10 per cent (26.6p in 2011).
| ASHMORE (ASHM) | ||||
|---|---|---|---|---|
| ORD PRICE: | 394p | MARKET VALUE: | £2.8bn | |
| TOUCH: | 393-394p | 12-MONTH HIGH: | 430p | LOW: 299p |
| DIVIDEND YIELD: | 3.7% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 67p* | NET CASH: | £324m | |
| Half-year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 179 | 128 | 14.3 | 4.16 |
| 2011 | 179 | 130 | 13.8 | 4.25 |
| % change | - | +2 | -3 | +2 |
Ex-div: 7 Mar Payment: 4 Apr *Includes intangible assets of £103m, or 15p a share | ||||
