Brooks Macdonald reports 'positive' quarter amid downturn

Brooks Macdonald Group reported a “positive” fourth quarter in an update on Thursday, benefiting from “strong” client and intermediary relationships and a “resilient” business model.

The AIM-traded firm said it expected full-year results in line with market expectations, adjusted for recent market movements.

It added that, while the pipeline for the 2023 financial year was strong, conversion times continue to be affected by ongoing market uncertainty.

The group recorded positive net flows in the three months ended 30 June of £0.3bn or 1.7%, making for an annualised rate of 6.7%.

That was offset by declining global markets, resulting in an overall 5.9% reduction in the group's closing funds under management to £15.7bn, compared to £16.7bn at the end of March.

UKIM Discretionary delivered net inflows in the quarter of £0.3bn, corresponding to annualised net flows of 10.8%.

Platform MPS and BMIS continued to build momentum, the board said, with combined annualised net flows of 45.6% for the quarter.

Investment performance for the quarter delivered a funds under management reduction of £1.3bn or 7.6%, in line with the MSCI PIMFA Private Investor Balanced Index.

During the financial year ended 30 June, the group achieved positive net flows of £0.8bn or 4.8%, representing an upswing of £1.1bn from the net flows recorded in 2021.

That was offset by the market downturn, the company said, leading to an overall decrease in the group's closing funds under management of 4.8% from the start of the year.

“I am delighted to report our fifth consecutive quarter of positive net flows, bringing our net flows rate up to 6.7% on an annualised basis,” said chief executive officer Andrew Shepherd.

“This demonstrates sustained momentum and the robustness of our business model.

“Against the backdrop of declining markets, it is more important than ever to stay connected with our clients and intermediaries, and I am proud of how our people have made a difference for them and helped deliver such strong results.”

At 0954 BST, shares in Brooks Macdonald Group were down 5.09% at 2,050p.

Reporting by Josh White at Sharecast.com.