TIDMBRK
RNS Number : 9084Z
Brooks Macdonald Group PLC
17 January 2024
17 January 2024
BROOKS MACDONALD GROUP PLC
Second Quarter FUM Announcement and Half Year Trading Update
"FUM up 4.3% in the quarter to GBP17.6 billion"
Brooks Macdonald Group plc ("Brooks Macdonald" or "the Group")
today publishes an update on its Funds under Management and Advice
("FUM/A") for the second quarter of its financial year, the three
months ended 31 December 2023.
Quarterly FUM/A update
During the quarter ended 31 December 2023, the Group delivered
robust gross inflows at GBP0.6 billion, up 1.5% on the prior
quarter to an annualised rate of 14.0%. Gross outflows were
elevated, particularly in BPS and Funds, reaching GBP0.7 billion
for the quarter, driven by the prevailing backdrop of market
volatility and higher interest rates continuing to affect client
behaviour.
This resulted in overall net outflows for the quarter of GBP0.1
billion or 0.6%.
The net outflows were more than offset by positive investment
performance in the quarter of 4.9% resulting in the Group's closing
Funds Under Management ("FUM") increasing 4.3% to GBP17.6 billion
(30 September 2023: GBP16.9 billion).
As at 31 December 2023, the Group had GBP5.2 billion Funds under
Management or Advice ("FUM/A") with private clients who deal with
the Group directly. GBP4.4 billion related to portfolios in the
Group's investment management and GBP0.8 billion to portfolios with
third party investment managers.
Highlights for the quarter included:
-- Investment performance for the quarter was positive at 4.9%,
in line with the benchmark MSCI PIMFA Private Investor Balanced
Index which increased by 5.0% in the period;
-- Platform MPS, including the Group's B2B offering for
financial advisers, BM Investment Solutions ("BMIS"), grew to
GBP3.9 billion - an increase in the quarter of 7.3%, of which
organic net flows contributed 3.3%;
-- BPS experienced net outflows in the quarter of GBP0.1 billion
or 1.1%, as clients withdrew funds to repay debt or to hold higher
cash balances;
-- Within UK BPS, the recently launched gilts offering generated
net new business of 44.7% in the quarter, taking it to c.GBP0.2
billion FUM in its first year, meeting client demand for their
portfolios to take advantage of higher interest rates while
avoiding equity risk;
-- Total UKIM discretionary FUM increased by 5.0% over the
quarter, primarily driven by the rally in markets seen in December
2023.
Half Year trading update
Trading performance in the first half was solid, with total FUM
up 4.3%. In parallel, the Group completed the organisational
changes announced in October, delivering a full year cost saving
of
c.GBP4 million. The cost of the changes was within the
previously notified GBP3 million, a non-recurring expense which the
Group intends to exclude from its reported underlying profit.
Outlook
The Group expects momentum on gross inflows to continue across
the product range in the second half, with the level of both gross
outflows and the resulting full year net flows dependent in part on
macroeconomic factors.
Following the organisational changes announced in October, the
Group expects its full year underlying profit and underlying profit
margin to be in line with market expectations.
Andrew Shepherd, CEO of Brooks Macdonald commented:
"I am pleased to report growth of 4.3% in the Group's FUM for
the first half of the financial year. This result is a testament to
the expertise and hard work of our people who are committed to
delivering on our purpose to 'realise ambitions and secure futures'
for all our stakeholders.
"During a challenging period for both the economy and financial
markets, we continued to see healthy demand across our range of
products and services, with GBP0.6 billion of gross inflows during
the second quarter. Pleasingly, this included 44.7% organic growth
from our recently launched and fast-growing gilt portfolio
service.
"These results reflect our capabilities as a Group to deliver
what people value - the guidance and reassurance of trusted advice
and robust long-term investment management. Given those
capabilities and the opportunities we can see ahead, I remain
confident in our ability to deliver on the Group's ambitious growth
strategy."
Notice of Half Year results
The Group intends to issue its preliminary statement of half
year results for the period ended 31 December 2023 on Thursday 7
March 2024.
An analyst meeting will be held at 9.30am on Thursday, 7 March
2024. Please contact Iona Biggart at FTI Consulting on 07971 989065
or e-mail brooksmacdonald@fticonsulting.com for further
details.
Analysis of FUM net flows by service over the quarter
Quarter to 31 December 2023 (GBPm)
Opening Organic Investment Closing Organic Total
FUM net new performance FUM net new mvmt
1 Oct 23 business in the period 31 Dec business
23
---------- ---------- --------------- -------- ---------- -------
BPS 8,444 (94) 462 8,812 (1.1)% 4.4%
---------- ---------- --------------- -------- ---------- -------
MPS Custody 957 (21) 34 970 (2.2)% 1.4%
---------- ---------- --------------- -------- ---------- -------
MPS Platform 3,662 121 147 3,930 3.3% 7.3%
---------- ---------- --------------- -------- ---------- -------
MPS total 4,619 100 181 4,900 2.2% 6.1%
---------- ---------- --------------- -------- ---------- -------
UKIM discretionary 13,063 6 643 13,712 0.0% 5.0%
---------- ---------- --------------- -------- ---------- -------
Funds - DCF 317 (23) 13 307 (7.3)% (3.2)%
---------- ---------- --------------- -------- ---------- -------
Funds - Other 1,324 (48) 69 1,345 (3.6)% 1.6%
---------- ---------- --------------- -------- ---------- -------
Funds total 1,641 (71) 82 1,652 (4.3)% 0.7%
---------- ---------- --------------- -------- ---------- -------
UKIM total 14,704 (65) 725 15,364 (0.4)% 4.5%
---------- ---------- --------------- -------- ---------- -------
International 2,152 (33) 96 2,215 (1.5)% 2.9%
---------- ---------- --------------- -------- ---------- -------
Total 16,856 (98) 821 17,579 (0.6)% 4.3%
---------- ---------- --------------- -------- ---------- -------
Total investment performance 4.9%
----------------------------------------------------------------------- -------------------
MSCI PIMFA Private Investor Balanced Index(1) 5.0%
----------------------------------------------------------------------- -------------------
(1) Capital-only index.
Analysis of FUM net flows by service over the half year
Six months to 31 December 2023 (GBPm)
Opening Organic net new business Total Closing Organic Total
FUM Inv. FUM net new mvmt
Perf. business
-------- ----------------------------- ------- -------- ---------- -------
1 Jul Q1 Q2 Total YTD 31 Dec YTD YTD
23 YTD 23
-------- --------- -------- -------- ------- -------- ---------- -------
BPS 8,527 (98) (94) (192) 477 8,812 (2.3)% 3.3%
-------- --------- -------- -------- ------- -------- ---------- -------
MPS Custody 966 (14) (21) (35) 39 970 (3.6)% 0.4%
-------------------- -------- --------- -------- -------- ------- -------- ---------- -------
MPS Platform 3,489 147 121 268 173 3,930 7.7% 12.6%
-------- --------- -------- -------- ------- -------- ---------- -------
MPS total 4,455 133 100 233 212 4,900 5.2% 10.0%
-------- --------- -------- -------- ------- -------- ---------- -------
UKIM discretionary 12,982 35 6 41 689 13,712 0.3% 5.6%
-------- --------- -------- -------- ------- -------- ---------- -------
Funds - DCF 338 (26) (23) (49) 18 307 (14.5)% (9.2)%
-------------------- -------- --------- -------- -------- ------- -------- ---------- -------
Funds - Other 1,370 (52) (48) (100) 75 1,345 (7.3)% (1.8)%
-------- --------- -------- -------- ------- -------- ---------- -------
Funds total 1,708 (78) (71) (149) 93 1,652 (8.7)% (3.3)%
-------- --------- -------- -------- ------- -------- ---------- -------
UKIM total 14,690 (43) (65) (108) 782 15,364 (0.7)% 4.6%
-------- --------- -------- -------- ------- -------- ---------- -------
International 2,157 (27) (33) (60) 118 2,215 (2.8)% 2.7%
-------- --------- -------- -------- ------- -------- ---------- -------
Total 16,847 (70) (98) (168) 900 17,579 (1.0)% 4.3%
-------- --------- -------- -------- ------- -------- ---------- -------
Total investment performance 5.3%
-------------------------------------------------------------------------------------------- ---------
MSCI PIMFA Private Investor Balanced Index(1) 5.6%
-------------------------------------------------------------------------------------------- ---------
(1) Capital-only index.
Analysis of FUM gross flows by service over the half year
Organic gross inflows Q2 vs Organic gross outflows Q2 vs
Q1 Q1
Q1 Q2 Total Inc/(dec) Q1 Q2 Total Inc/(dec)
YTD % YTD %
------ -------- -------- --------- ------- ------- -------- -----------
BPS 192 173 365 (9.9)% (290) (267) (557) (7.9)%
------ -------- -------- --------- ------- ------- -------- -----------
MPS Custody 15 15 30 - (29) (36) (65) 24.1%
-------------------- ------ -------- -------- --------- ------- ------- -------- -----------
MPS Platform 276 317 593 14.9% (129) (196) (325) 51.9%
------ -------- -------- --------- ------- ------- -------- -----------
MPS total 291 332 623 14.1% (158) (232) (390) 46.8%
------ -------- -------- --------- ------- ------- -------- -----------
UKIM discretionary 483 505 988 4.6% (448) (499) (947) 11.4%
------ -------- -------- --------- ------- ------- -------- -----------
Funds - DCF 12 7 19 (41.7)% (38) (30) (68) (21.1)%
-------------------- ------ -------- -------- --------- ------- ------- -------- -----------
Funds - Other 43 45 88 4.7% (95) (93) (188) (2.1)%
------ -------- -------- --------- ------- ------- -------- -----------
Funds total 55 52 107 (5.5)% (133) (123) (256) (7.5)%
------ -------- -------- --------- ------- ------- -------- -----------
UKIM total 538 557 1,095 3.5% (581) (622) (1,203) 7.1%
------ -------- -------- --------- ------- ------- -------- -----------
International 44 34 78 (22.7)% (71) (67) (138) (5.6)%
------ -------- -------- --------- ------- ------- -------- -----------
Total 582 591 1,173 1.5% (652) (689) (1,341) 5.7%
------ -------- -------- --------- ------- ------- -------- -----------
Enquiries to:
Brooks Macdonald Group plc www.brooksmacdonald.com
Andrew Shepherd, CEO 020 7927 4816
Andrea Montague, Chief Financial
Officer
Singer Capital Markets (Nominated
Adviser and Joint Broker)
Charles Leigh-Pemberton / James
Moat 020 7496 3000
Investec Bank plc (Joint Broker)
Bruce Garrow / David Anderson 020 7597 4000
FTI Consulting brooksmacdonald@fticonsulting.com
Edward Berry 07703 330199
Notes to editors
Brooks Macdonald Group plc, through its various subsidiaries,
provides leading wealth management services in the UK and
internationally. The Group, which was founded in 1991 and began
trading on AIM in 2005, had discretionary Funds under Management of
GBP17.6 billion as at 31 December 2023.
Brooks Macdonald offers outsourced discretionary investment
management for intermediaries and advice-led integrated wealth
management for private clients. The Group also acts as fund manager
to a range of onshore and international funds.
The Group has fourteen offices across the UK and Crown
Dependencies including London, Birmingham, East Anglia, Exeter,
Leeds, Manchester, Nuneaton, Southampton, Tunbridge Wells,
Scotland, Wales, Jersey, Guernsey and Isle of Man.
LEI: 213800WRDF8LB8MIEX37
www.brooksmacdonald.com / @BrooksMacdonald
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