Last checked at 12 Jan 2016 07:00
City of London Investment Group PLC
12 January 2016
CITY OF LONDON INVESTMENT GROUP PLC
("City of London", "the Group" or "the Company")
FUNDS UNDER MANAGEMENT AS AT 31 December 2015,
TRADING UPDATE
City of London (LSE: CLIG) announces that total funds under management (FuM) at the Group's half year end on 31 December 2015 were US$3.8 billion (£2.6 billion). This compares with US$4.2 billion (£2.7 billion) at the Company's year-end on 30 June 2015.
The fall in FuM of 11% compares with a fall of 17% in the MSCI Emerging Markets TR Index (NDUEEGF). Despite the fall in the index, the Group is pleased to report continued net inflows and outperformance over the period.
With "wins" of just under $200m expected to fund over the next 3-6 months, Barry Olliff, CEO states "we consider that we are in a good place within both our peer group and also from a client stability perspective. Therefore, we are increasing the net new money assumption for our EM CEF strategy to $500m for the next financial year. In addition, recent mandates are spread across GTAA, Frontier also EM and three specialist China mandates. This level of asset allocation diversity is not something that we have experienced in the past."
As of the end of December the monthly "run-rate" for operating profit, before profit-share of c.30%, is approximately £0.9 million per month based upon current FuM. The Group estimates the unaudited profit before taxation for the six months ended 31 December 2015 to be approximately £3.6 million, which compares to £4.3 million for the equivalent period to 31 December 2014, as restated for the effects of IFRS10.
The Company is currently in a close period which will end with the publication of results for the six months ended 31 December 2015 on 15 February 2016.
Template
Please see the attached graph which is based on the following assumptions and includes the estimated quarterly cost of a maintained dividend:
http://www.rns-pdf.londonstockexchange.com/rns/5184L_-2016-1-11.pdf
Key assumptions:
(June 2015 comparatives in Italics)
· Starting point Current FuM (end December 2015)
· Net new money for the remainder of this financial year (straight-lined to June 2016):
- emerging market CEF strategy $150m (US$250m over full year)
- non-emerging market CEF strategies $50m (US$250m over the full year)
· Net new money in 2016/2017 (straight-lined to June 2017):
- emerging market CEF strategy $500m
- non-emerging market CEF strategies $250m
· Operating margin adjusted monthly for change in product mix and commission run-off
· Market growth: 0%
· Overheads for 2015/16: +8% compared to 2014/15
· Overheads for 2016/17: +10% compared to 2014/15
· Corporation tax based on an estimated average rate of 27% (25%)
· Exchange rate assumed to be £1/$1.47 for entire period (£1/US$1.55)
· Number of CLIG Shares in issue (26.8m) less those held by the ESOP Trust (2.0m) as at 31 December (27.0 m CLIG shares in issue less 2.0m ESOP Trust holding).
For further information, please visit http://www.citlon.co.uk/ or contact:
Barry Olliff, CEO
City of London Investment Group PLC
Tel: 001 215 313 3774
Roger Lambert
Canaccord Genuity Limited
Financial Adviser & Broker
Tel: +44 (0)20 7523 8000