Aberdeen hit by £11bn outflows but SWIP effect keeps profits coming

Aberdeen Asset Management grew revenue, profit and assets under management in the six months to the end of March, as last year’s acquisition of Scottish Widows Investment Partnership buoyed half year results.

Despite seeing more than £11bn of outflows and net new business of -£11.3bn, compared to -£8.8bn in the same period last year, assets under management still grew to £330.6bn from £324.5bn last year, according to the firm’s latest half year results.

Aberdeen saw inflows of £23.4bn, which were counteracted by outflows of £34.7bn but still increased pre-tax profits by 25 per cent to £270.2m, after diversifying its business when it bought SWIP last Spring.

The manager also grew net revenue by 20 per cent in the six month period to £605.2m and also increased its dividend, from 6.75p to 7.5p.

Martin Gilbert, Chief Executive of Aberdeen, said: “I am pleased to report that the Group has increased its underlying profits by 25 per cent as we benefited from the diversifying effects of the acquisition of Scottish Widows Investment Partnership, which we completed a year ago. We remain strongly cash generative and we again increased our dividend, whilst also adding to our regulatory capital headroom.

Aberdeen suffered outflows at the end of last year too, seeing £4.8bn of net outfows over the three months to the end of December. Aberdeen lost £3.34bn of net assets while the SWIP division lost £1.45bn, with total assets under management falling to £323.3bn.

Mr Gilbert added: “Gross new business inflows have continued to grow. However, they have been offset by outflows, which reflect changes in asset allocation driven by macro-economic factors and some structural outflows from certain clients. Despite these headwinds we are well positioned for the long term: financially strong, with a global distribution platform and a diversified range of capabilities and solutions for the evolving investment environment. Our absolute priority, as always, remains delivering for our clients.”