Schroders (SDR) repeated its trick of growing its assets under management (AuM) while watching its profits slide. The asset manager lifted its AuM by 5 per cent to a new high of £526bn after completing the onboarding of a giant £29.5bn Scottish Widows mandate during the period, achieving net new business of £38.1bn overall.
The solutions arm brought in net new business of £42.7bn over its first half, which was significantly above the £2.1bn it secured in the same period last year. But the funding of smaller solutions mandates at lower margins helped drive down Schroders’ net operating revenue margin, excluding performance fees, carried interest and real estate transaction fees, which fell to 39 basis points from 46 basis points last year.
The manager’s wealth business also helped Schroders hit its AuM record, bringing positive inflows of £1.3bn. But market volatility drove retail investors away from its mutual fund proposition, which saw net outflows balloon to £4.8bn from £1.8bn last year.
Numis analysts forecast full-year 2020 pre-tax profits and earnings per share of £572m and 161p, respectively, rising to £585m and 165p in 2021.
| SCHRODERS (SDR) | ||||
| ORD PRICE: | 2,959p | MARKET VALUE: | £8.36bn | |
| TOUCH: | 2,957-2,960p | 12-MONTH HIGH: | 3,465p | LOW: 1,711p |
| DIVIDEND YIELD: | 3.9% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 1,389p | NET CASH: | £3.1bn | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2019 | 1.23 | 319 | 92.4 | 35 |
| 2020 | 1.19 | 280 | 78.7 | 35 |
| % change | -3 | -12 | -15 | - |
| Ex-div: | 20 Aug | |||
| Payment: | 24 Sep |
