After spinning out from Old Mutual via a main market listing in June, Quilter (QLT) attempted to woo investors with a bumper special dividend at the half-year mark. Management plans to return £221m in excess capital - representing 12p a share – to shareholders, using part of the proceeds from the sale of the Single Strategy asset management business.
The wealth manager – formerly Old Mutual Wealth – gained £2.2bn in net client flows during the period, offsetting a weaker market performance of around £100m to push total assets under management and administration up 2 per cent to £116.5bn. However, those inflows were down on £3.2bn booked in the same period last year. The decline was primarily due to weaker flows from platform provider Quilter International, which were down three-quarters as management reduced the international presence.
Running off the institutional book at the life assurance business also resulted in net cash outflows of £0.1bn, with assets under management and administration for that business down 7 per cent to £14.5bn. However, inflows into the UK platform business were much better at £2.1bn, talking total assets under management and administration up 14 per cent to £52.3bn.
The advice and wealth management businesses also put in a stronger performance. Multi-asset investment business Quilter Investors gained £1.8bn in net cash inflows, representing organic growth of just over a fifth, primarily into the Cirilium and Generation fund ranges. In fact, Cirilium represented more than half net inflows into the multi-asset business. Meanwhile discretionary investment management provider Quilter Cheviot also grew assets under management by 7 per cent, after gaining £0.5bn in net inflows. However, that was slightly down on the £0.6bn reported in the prior year, after a slower second quarter.
Analysts at Numis expect adjusted pre-tax profits of £226m for the year to December 2018, giving EPS of 11.3p (up from £209m and 9.6p in 2017).
| QUILTER (QLT) | ||||
| ORD PRICE: | 149.08p | MARKET VALUE: | £2.84bn | |
| TOUCH: | 149.02-149.08p | 12-MONTH HIGH: | 160p | LOW: 141p |
| DIVIDEND YIELD: | 8%* | PE RATIO: | 497 | |
| NET ASSET VALUE: | 108p** | NET CASH: | £3.2bn | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2017 | 3.15 | 5.0 | -1.0 | nil |
| 2018 | 0.86 | 17.0 | 1.8 | nil |
| % change | -73 | +240 | - | - |
| Ex-div: | 23 Aug | |||
| Payment: | 21 Sep | |||
| NB: revenue figures are pre-demerger of Old Mutual, while pre-tax and EPS refer to continuing operations. *Special dividend of 12p a share declared (see above dates). **Includes intangible assets of £566m, or 30p a share. | ||||
