Schroders' (SDR) bias towards institutional assets did not save it from the impact of rocky equity markets in 2018, with the asset manager suffering £9.5bn in net outflows compared with net inflows of £9.6bn the prior year. Together with £19.6bn of negative market movements, that meant assets under management (AUM) and administration closed the year down 6 per cent.
However, a £22.6bn rise in average assets under management over the year, and continued demand for private assets and alternatives, meant net income rose during the period. Inflows and performance levels have also improved since the end of last year, according to chief financial officer Richard Keers.
Pre-tax profits were lower without the prior year’s exceptionally high performance fees and the accounting benefit of deferring employee compensation. The asset manager also incurred £56m in exceptional operating costs from strategic growth initiatives, including setting up an office in Shanghai employing 46 staff members.
Demand for wealth management services held up, with the business recording £1.7bn in net inflows, although assets under management still declined slightly due to investment losses.
Analysts at Numis expect adjusted pre-tax profits of £709m and EPS of 203p for 2019, down from £761m and 212p, respectively, in 2018.
SCHRODERS (SDR) | ||||
ORD PRICE: | 2,574p | MARKET VALUE: | £ 7.27bn | |
TOUCH: | 2,574-2,575p | 12-MONTH HIGH: | 3,511p | LOW: 2,289p |
DIVIDEND YIELD: | 4.4% | PE RATIO: | 14 | |
NET ASSET VALUE: | 1,282p* | NET CASH: | £2.7bn |
Year to 31 Dec | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2014 | 1.92 | 517 | 153 | 78 |
2015 | 2.04 | 589 | 171 | 87 |
2016 | 2.14 | 618 | 178 | 93 |
2017 | 2.51 | 760 | 215 | 113 |
2018 | 2.63 | 650 | 183 | 114 |
% change | +5 | -14 | -15 | +1 |
Ex-div: | 28 Mar | |||
Payment: | 09 May | |||
*Includes intangible assets of £968m, or 343p a share |