Schroders' net inflows fall as AuM boosted by sterling collapse

Fund manager Schroders reported flat profits in the first nine months of the year as its assets under management increased despite a fall in net inflows.

For the nine months ended 30 September, the FTSE 100 company had £375bn assets under management, a 27% increase from last year, helped by a £38.6bn benefit from the weakening of sterling since 1 January 2016.

Pre-tax profit fell slightly by 0.6% to £436.2m, whereas profit before tax and exceptional items was up 0.4% to £455.3m.

Chief executive Peter Harrison said the company delivered “solid results” as its diversified business model generated £2.7bn of net new business. This was a 67% fall from last year in the amount of new money raised.

He added that the company had made “progress against our strategic objectives, particularly in North America."

For the asset management business, operating revenue increased by 3.8% to £1.07bn, which included performance fees of £13.3m. Profit before tax was down 1.15% to £386.8m.

Net inflows for the nine months was £3.2bn, comprising of inflows of £5.4bn in Institutional and net outflows of £2.2bn in Intermediary. Assets under management were £339.4bn, up from £263.9bn.

For wealth management operating revenue rose 3% to £162.6m, while profit before tax fell 10% to £42.7m. There were net outflows of £0.5bn and assets under management were £35.6bn, up from £30.9bn.

Shareholders' equity at the end of September was £2.9bn, up 11.5%.