Man Group 2019 Funds Hit Record Levels, Dividend Down On Lower Fees

Fri, 28th Feb 2020 09:47

(Alliance News) - Man Group PLC on Friday reported a rise in funds over the course of 2019, but has declared a decreased dividend on slipping management fees.

At December 31, the FTSE 250-listed fund manager held USD177.7 billion in funds under management, 8.5% higher than the USD108.5 billion seen at the same point the year prior. Man Group noted it ended 2019 with a record funds under management.

Man Group recorded net outflows of USD1.3 billion in 2019, but this was more than offset by its investment performance, which added USD10.1 billion in funds.

"2019 was a year of solid growth and continued strategic progress at Man Group. We delivered strong absolute investment performance, making investment gains for our clients, and closed the period with record funds under management. We also increased our adjusted profit before tax by 54%," Chief Executive Luke Ellis said.

He continued: "Over the course of the year, we saw continued inflows into our alternative strategies, although overall we recorded a small outflow as our clients reduced their equity allocations. In the fourth quarter, we returned to net inflows and that momentum has continued into this year."

The fund manager noted its asset weighted performance was 1.1% behind its peers in the period.

Man Group's Alternative funds under management ended the year 10% higher at USD71.5 billion, with the Total Return asset class performing best with a 20% rise, with Absolute Returns and Multi-Manager Solutions rising by 5.5% and 0.7%, respectively.

The company's Long Only funds added 7.5% to USD46.2 billion, seeing both its Systematic and Discretionary assets rise. The Long Only funds benefited from a USD3.2 billion investment market gain in 2019.

Man Group declared a final dividend of 5.1 US cents, taking its total dividend for 2019 to 9.8 cents - which is down 17% on the 11.8 cent distribution in 2018. Man Group pays out 100% of adjusted management fee earnings per share as a dividend, which was down in 2019 on sliding management fees.

The fund manager's pretax profit increased 10% in 2019 to USD307 million from USD278 million in 2018.

Man Group's net revenue increased 22% year on year to USD1.11 billion from USD913 million. Net management fee revenue slipped 4.8% but this was offset by a performance fees more than tripling.

Separately, the fund manager said it has hired former British Land Co PLC CFO Lucinda Bell and Nexus Management Group founder Ceci Kurzman to its board as non-executive directors, effective Friday.

Bell currently sits on the board of London-listed firms Derwent London PLC, Rotork PLC and Crest Nicholson Holdings PLC.

Anne Wade is also joining Man's board as a non-executive director, starting April 30. Wade currently sits on the board of London-listed firm John Laing Group PLC and Summit Materials Inc.

Shares in Man Group were down 0.7% in London on Friday morning at 145.05 pence each.

By Paul McGowan; paulmcgowan@alliancenews.com