Man Group profit, FUM slump in first half

Hedge fund Man Group reported a slump in pre-tax profit and funds under management for the first half amid tough trading conditions.

For the six months ended 30 June, statutory pre-tax profit tumbled to $55m from $163m in the same period last year, while funds under management declined to $76.4bn from $78.8bn.

Meanwhile, performance fees fell to $42m from $231m and the company said the first half of the year had been particularly challenging for the global investment management industry amid highly volatile financial markets.

Still, Man said it had net inflows of $1bn versus net outflows of $2.6bn in the first half of 2015.

Chief executive officer Manny Roman said: “AHL's momentum strategies performed well, but it was a difficult time for our long only strategies. Markets reversed in the second quarter, and as a result, AHL's momentum strategies gave back the gains they had made in the first quarter.

“Recent volatility post-Brexit has benefitted AHL but created a difficult environment again for our discretionary strategies. In the context of this market environment, we had net inflows of $1.0bn for the half. In particular, we saw good inflows into our quant business from institutional clients, across AHL's range of strategies and into Numeric.”

Roman said the oulook post Brexit remains uncertain and as a result, the risk appetite of Man's clients has the potential to impact flows, although there has been no meaningful change so far.

Still, he insisted the company was committed to keeping its headquarters in the UK.

RBC Capital Markets said the results were largely as it had expected and its full-year forecasts, which were recently updated, remain achievable.

“The positives in our opinion are the resiliency of Man’s net flows and an outlook statement that indicates no adverse impact – so far – from the uncertainty created by Brexit.”

At 0900 BST, Man Group shares were down 2.6% to 119.20p.