Perpetual reflects on $4.3bn outflows in ‘difficult quarter’
Perpetual saw $4.3 billion in outflows from its asset management division in the last quarter to 31 December, but market movement meant overall AUM increased.
Total assets under management (AUM) were $213 billion at the end of December 2023, which was up from $211 billion at the end of September, but the firm said this came from positive market movements that offset outflows.
Net outflows were $4.3 billion and currency movements affected AUM by a further $7.1 billion, but positive market movements added $13.7 billion.
On its J O Hambro Capital Management (JOHCM) division, AUM was down by 1.5 per cent after seeing net outflows of $1.7 billion and a negative currency movement of $1.2 billion, particularly in its Global Opportunities, Global Select and International Select strategies. However, this was offset by favourable equity market movements of $2.3 billion.
Pendal Asset Management, which Perpetual acquired at the start of 2023, saw AUM up 2.3 per cent in the quarter thanks to market movements of $1.9 billion, which offset net outflows of $0.9 billion.
“Net outflows were mainly in cash which reported $0.5 billion in net outflows during the quarter due to client asset allocation shifts,” the firm noted.
In wealth management, funds under advice (FUA) were $19.1 billion, which was up 4 per cent on the previous quarter, but net flows were flat. Total average FUA for the three months was $18.4 billion, down slightly from $18.7 billion.
Chief executive, Rob Adams, said: “The December quarter was a difficult period for active asset managers globally, being the worst quarter in 15 years for active equity fund flows. Whilst the net outflows of $4.3 billion in our asset management business are disappointing, it was pleasing to see our total AUM rise slightly to $213.9 billion, highlighting the benefit of our exposure to global markets as well as the resilience the business has through its exposure to various markets, currencies and client types.
“We remain focused on completing the integration of Pendal. Pleasingly, we are ahead of schedule in delivering the promised $80 million in run-rate expense synergies. While our overall target of $80 million is unchanged, we are ahead of our interim target of achieving 50 per cent by January 2024.”
In its full year 2022–23 results in July, the firm said it had restructured the executive leadership team in asset management after reporting $8.1 billion in outflows from its asset management business in FY23. It therefore opted to change up its group executive team with a simplified asset management structure and leadership.
The current regional asset management businesses were changed to form one global division, led by Rob Adams as chief executive of asset management, who holds the role in addition to his group CEO role.
AUTHOR
Laura Dew
Recommended for you
Pinnacle Investment Management has announced it plans to launch a new affiliate from a global equities team departing Royal London Asset Management.
Asset manager Nuveen is seeing opportunity in municipal bonds which are at their highest yields in over a decade.
With energy transition remaining a significant challenge, a global index provider executive has argued that engagement could trump divestment.
Aviva Investors is maintaining an underweight stance on the communications sector within its high yield allocation as it believes it faces a higher default rate.
Add new comment