Liontrust profits sink amid 'challenging' market environment

(Sharecast News) - Shares in Liontrust fell on Wednesday after the asset manager reported a sharp fall in annual profits and net outflows of nearly £5bn following a year in which the company overhauled its operating model, distribution and fund range amid challenging market conditions.

Gross profits totalled £158m for the 12 months to 31 March, down from £186m previously, with performance fee revenues sinking to just £3.6m from £10.4m.

Adjusted pre-tax profits fell to £48m from £67m, while adjusted diluted earnings per share fell to 56.8p from 79.2p.

Assets under management and administration totalled £22.59bn by the end of the period, down from £27.82bn a year earlier, with net outflows of £4.9bn and a negative market and investment performance of -£328m.

Liontrust maintained its full-year dividend at 72p per share.

"We believe it will be more challenging for markets to generate the same level of returns in the next few years as over the past decade," said chief executive John Ions.

"This will lead to investors searching for alpha by moving away from passive vehicles to active asset managers, deeper within markets and on a more geographically diverse basis. These investment opportunities include generational low valuations among UK quality companies."

However, he said that the company is "well placed" to take advantage of this new environment.

Shares were 6.2% lower at 386p by 0952 BST.

Liontrust Asset Management