Third Quarter Trading Update
19 Januar 2010 - 8:00AM
UK Regulatory
TIDMREC
RNS Number : 7456F
Record PLC
19 January 2010
19 JANUARY 2010
RECORD PLC
THIRD QUARTER TRADING UPDATE
Record plc ("Record" or the "Company"), the specialist currency investment
manager, announces today that as at 31st December 2009 the Group's assets under
management equivalents ("AuME") totalled $35.7 billion (30th September 2009:
$36.0 billion).
AuME expressed in Sterling as at 31st December 2009 totalled GBP22.1
billion (30th September 2009: GBP22.5 billion).
1. AuME composition
Record saw a marginal decrease to AuME during the period between 30th September
2009 and 31st December 2009. The composition of AuME at 31st December 2009 was
as follows:
+------------------------+------------+-----------+-----------+-----------+
| AuME $ bn |
+-------------------------------------------------------------------------+
| | 31st December 2009 | 30th September 2009 |
+------------------------+------------------------+-----------------------+
| Absolute Return | | | | |
+------------------------+------------+-----------+-----------+-----------+
| Segregated | 4.0 | | 4.2 | |
+------------------------+------------+-----------+-----------+-----------+
| Pooled | 5.3 | | 6.0 | |
+------------------------+------------+-----------+-----------+-----------+
| Absolute Return Sub | | 9.3 | | 10.2 |
| Total | | | | |
+------------------------+------------+-----------+-----------+-----------+
| Active Hedging | | 11.6 | | 11.0 |
+------------------------+------------+-----------+-----------+-----------+
| Passive Hedging | | 13.6 | | 13.5 |
+------------------------+------------+-----------+-----------+-----------+
| Cash & Futures | | 1.2 | | 1.3 |
+------------------------+------------+-----------+-----------+-----------+
| Total | | 35.7 | | 36.0 |
+------------------------+------------+-----------+-----------+-----------+
The mandates for the two US state pension funds have now been fully implemented
and totalled $7.9 bn at 31st December 2009. The largest of these was $6.2 bn at
31st December 2009. Given the size of this client's mandate, any change it may
decide to make to its asset allocation or hedging policy could have a
significant impact on AuME.
2. AuME MOVEMENT
Net client AuME flows in the three months to 31st December 2009 by product were
as follows:
+------------------------+------------+-----------+------------+-----------+
| Net client AuME flows - $ bn |
+--------------------------------------------------------------------------+
| | 3 mths to 31st | 3 mths to |
| | December 2009 | 30th September 2009 |
+------------------------+------------------------+------------------------+
| Absolute Return | | | | |
+------------------------+------------+-----------+------------+-----------+
| Segregated | (0.3) | | (1.2) | |
+------------------------+------------+-----------+------------+-----------+
| Pooled | (0.6) | | - | |
+------------------------+------------+-----------+------------+-----------+
| Absolute Return Sub | | (0.9) | | (1.2) |
| Total | | | | |
+------------------------+------------+-----------+------------+-----------+
| Active Hedging | | 0.4 | | 1.1 |
+------------------------+------------+-----------+------------+-----------+
| Passive Hedging | | - | | (2.1) |
+------------------------+------------+-----------+------------+-----------+
| Cash & Futures | | (0.1) | | 0.2 |
+------------------------+------------+-----------+------------+-----------+
| Total | | (0.6) | | (2.0) |
+------------------------+------------+-----------+------------+-----------+
Record had 102 clients at 31st December 2009, compared to 118 at 30th September
2009.
The factors other than client flows which impacted AuME during the quarter,
totalling +$0.3 billion, were:
(i) Exchange rate movements:+$0.2bn
Exchange rate movements during the period affect the conversion of non-US Dollar
mandate sizes into US Dollar AuME;
(ii) Movements in global stock and other markets:+$0.2bn
Substantially all the Passive and Active Hedging, and some of the Absolute
Return mandates are linked to stock and other market levels. Consequently AuME
is affected by movements in these markets which had a positive impact in the
quarter;
(iii) Pooled fund investment performance: -$0.1bn
Investment returns are compounded on a geared basis into the AuME of the pooled
funds and so impact AuME.
Investment performance in Record's Absolute Return product was negative during
the quarter ending 31st December 2009 and for an un-geared portfolio equated to
a decrease of 0.44% over the quarter as a whole (six months to
30th September 2009: increase of 0.89%).
3. AVERAGE FEE RATES
During the quarter to 31st December 2009, average management fee rates were
maintained across all products.
4. CHAIRMAN'S COMMENT
Chairman and CEO, Neil Record, commenting on trading, said "We continue to
benefit from the diversification of active hedging which is now slightly larger
than the absolute return business.
Our active hedging product, being systematic in nature, continues to perform in
line with client expectations. We continue to see interest in the active
hedging product.
For the absolute return product, investment performance in the quarter was
negative, although investment performance of our Alpha Composite was +0.45% for
the first three quarters of the financial year. This compares to a negative
return of 3.49% for the whole of the financial year ended 31st March 2009. Our
Cash Plus fund, which is seven times geared, achieved a positive return of 2.15%
for the first three quarters of the financial year. Whilst there may be further
Absolute Return outflows, we remain confident in and committed to our long-term
investment strategy."
Record will announce its fourth quarter trading update on 20th April 2010.
+---------------------------------------------+--------------------------+
| For further information, please contact: | |
+---------------------------------------------+--------------------------+
| | |
+---------------------------------------------+--------------------------+
| Record plc | Tel: +44 (0) 1753 852 |
| | 222 |
+---------------------------------------------+--------------------------+
| Neil Record | |
+---------------------------------------------+--------------------------+
| Paul Sheriff | |
+---------------------------------------------+--------------------------+
| | |
+---------------------------------------------+--------------------------+
| Hogarth | Tel: +44 (0)20 7357 9477 |
+---------------------------------------------+--------------------------+
| Nick Denton | |
+---------------------------------------------+--------------------------+
| Julian Walker | |
+---------------------------------------------+--------------------------+
Notes to Editors
Record plc
Record is a specialist currency investment manager and provider of currency
hedging services for institutional clients. Founded in 1983, Record has
established a market leading position as a currency asset manager. Specifically,
the Group has a leading position in managing currency for Absolute Return for
institutional clients.
The Group has three principal product lines:
* currency for Absolute Return, in which Record enters into currency contracts for
clients with the objective of generating positive returns;
* active hedging, where Record seeks to eliminate the impact of currency movements
on elements of clients' investment portfolios that are denominated in foreign
currencies when these movements are expected to result in an economic loss to
the client, but not to do so when they are expected to result in an economic
gain; and
* passive hedging, where Record seeks to eliminate fully the economic impact of
currency movements on elements of clients' investment portfolios that are
denominated in foreign currencies.
Record (LSE: REC) was admitted to trading on the London Stock Exchange on 3rd
December 2007.
This announcement includes information with respect to Record's financial
condition, its results of operations and business, strategy, plans and
objectives. All statements in this document, other than statements of historical
fact, including words such as "anticipates", "expects", "intends", "plans",
"believes", "seeks", "estimates", "may", "will", "continue", "project" and
similar expressions, are forward-looking statements.
These forward-looking statements are not guarantees of the Company's future
performance and are subject to risks, uncertainties and assumptions that could
cause the actual future results, performance or achievements of the Company to
differ materially from those expressed in or implied by such forward-looking
statements.
The forward-looking statements contained in this document are based on numerous
assumptions regarding Record's present and future business and strategy and
speak only as at the date of this announcement.
The Company expressly disclaims any obligation or undertaking to disseminate any
updates or revisions to any forward-looking statements contained in this
announcement whether as a result of new information, future events or otherwise.
This information is provided by RNS
The company news service from the London Stock Exchange
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