(Alliance News) - Ashmore Group PLC on Wednesday reported a fall in assets under management but expressed confidence in its outlook ahead of expected cuts to global interest rates.
The London-based emerging markets-focused investment manager said assets under management were USD54.0 billion on December 31, down 3.4% from USD55.9 billion at June 30. The movement was attributable to net outflows of USD4.5 billion over the six months, partially offset by positive investment performance of USD2.6 billion.
Net revenue declined 14% to GBP94.5 million in the period, the first half of Ashmore's financial year, from GBP110.3 million a year prior, reflecting lower average assets under management and reduced foreign exchange gains, partially offset by higher performance fees.
Pretax profit increased 38% to GBP74.5 million from GBP53.8 million a year ago, while diluted earnings per share rose 39% to 8.47 pence from 6.09p.
Ashmore declared an unchanged interim dividend of 4.8p per share.
Looking ahead, Chief Executive Mark Coombs was optimistic.
"Emerging markets have continued to perform strongly over the six months, and the factors driving this performance - superior growth, effective monetary policies and a weaker US dollar as the Fed reaches the end of its tightening cycle - look set to underpin further increases in asset prices in 2024," he said.
"Although there are risks....there is a compelling argument for a shift in asset allocations from heavily indebted and relatively expensive Developed Markets to the Emerging Markets where many of the economies are sound, fiscal and monetary policies are sensible, and absolute and relative valuations are attractive," he suggested.
Ashmore pointed out emerging markets gross domestic product growth is expected to be three times faster than the developed world, with all regions delivering superior growth.
Shares in Ashmore were down 2.9% to 204.60p in London on Wednesday.
By Jeremy Cutler, Alliance News reporter
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Ashmore (ASHM)