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(Alliance News) - Man Group PLC on Tuesday reported "record" assets under management in its first-half, as the hedge fund hailed "broad-based demand".
Net flows in the second-quarter alone painted a more mixed picture, however, with its long-only offering leading the way, but its alternative strategies lagging.
Man Group shares traded 6.8% lower at 222.50 pence each in London on Tuesday afternoon, among the worst FTSE 250 performers.
Assets under management at June 30 totalled USD151.7 billion, rising 5.9% from USD143.3 billion at the end of December. It reported net inflows of USD2.6 billion during the half year, and USD1.5 billion for the second quarter alone.
Analysts at Jefferies noted the assets under management reading came in ahead of consensus of USD150.0 billion.
The London-based firm said revenue for the six-month period fell 43% to USD506 million from USD887 million. Pretax profit declined 70% to USD114 million from USD380 million.
Outgoing Chief Executive Luke Ellis said: "The first half of 2023 was a period of sustained organic growth for Man Group and I'm delighted to report record assets under management of USD151.7 billion, and net inflows of USD2.6 billion. These flows were 2.5% ahead of the industry, highlighting the broad-based demand we are seeing for the range of differentiated investment strategies and solutions that we offer, as well as the quality of our longstanding relationships with allocators around the world."
Man Group in May announced Robyn Grew would replace Ellis from the start of September. Grew will be the company's first female CEO.
Man declared a 5.6 cents per share interim dividend, unchanged year-on-year.
Looking ahead, the firm said: "We continue to believe that the current environment presents a significant opportunity for active investment managers, particularly those with the ability to offer alpha irrespective of prevailing market conditions and in liquid and customisable format. We have built a diversified and resilient business, with a compelling range of investment strategies and solutions, underpinned by high-performing talent and cutting-edge technology."
Alongside the USD2.6 billion worth of net flows, Man's asset management increase over the first half was boosted by a USD5.1 billion positive investment performance.
"Pleasingly, we recorded net inflows across alternative and long-only strategies, which highlights the broad-based demand for the range of differentiated investment strategies and solutions that we offer at Man Group," the company said.
In the final three months of the half-year, however, it was Man's long-only offering which outperformed. It recorded net flows of USD1.8 billion for long-only positions, compared to an outflow of USD300 million for alternative.
Analysts at UBS said this is likely to put shares under pressure.
"Man Group's core earnings were generally in line, and while AUMs and flows were a beat, the mix was not in Man Group's favour (more towards the lower-margin long-only strategies). As a result, we expect a moderately negative response for the shares," the Swiss bank explained.
By Eric Cunha, Alliance News news editor
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