Liontrust to cut jobs as profits fall

In the six months to 30 September, adjusted pre-tax profit fell to £25.8m from £36m in the same period a year earlier. Gross profit declined to £81.1m from £98.6m.

The company said it had been a "challenging period" for active managers, particularly given growing demand for passive vehicles.

Assets under management and advice fell to £26bn from £27.8bn, driven by by net outflows of £2.1bn.

Liontrust said it was proposing a reduction in staff numbers of around 25 roles, or 12% of the group across the business and across levels of seniority. If implemented in full, this will save around £4.5m and be carried out over the next few months.

As part of the plan, Liontrust is also closing four funds that are sub-scale and for which there is insufficient demand.

The company said it was maintaining its 72p a share dividend and announced a share buyback programme of up to £5m, phased over the period to the end of March 2025.

Chief executive John Ions said: "The last six months have continued the challenging period for active managers including Liontrust. There are a number of reasons, however, why we are confident that we are moving into a more positive environment and the outlook is improving.

"We are steadfast in our commitment to active management and to our partnership with clients through complementing their other strategies including passive investments. The headwinds facing many of our investment strategies are now being replaced by tailwinds including lower inflation and interest rates. We are seeing improved performance across our funds and we continue to have a strong brand and client engagement."

Ions said the strategic changes made to the group over the past year to drive the business forward, through diversifying the product range, broadening distribution, strengthening the technological, data and digital capability, and enhancing the client experience, are having a noticeable impact.

"This is all underpinned by our continued robust financial position," he said. "Our confidence is reflected in the fact that we are targeting the same dividends as last year and have announced a share buyback programme."

At 0955 GMT, the shares were up 7% at 445.50p.

Russ Mould, investment director at AJ Bell, said: "Asset manager Liontrust is on the comeback trail with a renewed sense of optimism in the commentary accompanying its half-year results.

"That sent the share price up 8%, making Reade Griffith a happy man. The hedge fund manager more than doubled his stake in Liontrust last week from 5% to 11.5% via his TFG investment vehicle.

"Griffith is no stranger to investing in Liontrust, having previously owned by more than 10% of the business nearly 10 years ago.

"That somewhat throws cold water on the idea he is building up a stake with a view to making a takeover offer. This looks to be a straightforward trade on an expected bounce-back in Liontrust’s share price."