Schroders (SDR) is a City stalwart that is fit for modern times, more than enduring this period of ultra-low interest rates. Among yield-hungry North American and UK institutional investors, multi-asset and fixed-income products continue to be popular. This demand helped draw in £1.4bn in net inflows in institutional assets during the six months to the end of June. Along with investment gains of £10.9bn, this took institutional assets under management up 5 per cent from the beginning of the year to £239bn.
That was just as well because new business in the intermediary channel continued to be much lower. In fact, the business suffered £1.2bn in net outflows, although a positive investment performance meant assets under management have grown by 4 per cent this year. Its white label products recorded £5.2bn in net outflows, including a significant multi-asset mandate in North America. This offset increased demand for branded funds, particularly equity products and from clients in continental Europe.
The wealth management division gained £0.6bn in net new business, £0.4bn of which came via its acquisition of US investor Benchmark Capital. However, it was the purchase of private bank C Hoare & Co that delivered the real kicker to assets under management, which rose 62 per cent to £54.9bn. This pushed net operating income for wealth management up more than a fifth to £131m.
Analysts at Numis expect adjusted pre-tax profit of £732m during the 12 months to December 2017, giving EPS of 206p (from £645m and 183p in 2016).
| SCHRODERS (SDR) | ||||
| ORD PRICE: | 3,448p | MARKET VALUE: | £9.19bn | |
| TOUCH: | 3,448-3,450p | 12-MONTH HIGH: | 3,499p | LOW: 2,541p |
| DIVIDEND YIELD: | 2.8% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 1,136p* | |||
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 1.00 | 282 | 81.1 | 29 |
| 2017 | 1.18 | 343 | 97.8 | 34 |
| % change | +18 | +22 | +21 | +17 |
| Ex-div: | 17 Aug | |||
| Payment: | 21 Sep | |||
| *Includes non-voting shares, and NAV includes intangible assets of £679m, or 240p a share | ||||
