Ninety One Regulatory News (N91)

Results for the year ended 31 March 2022

18 May 2022

Highlights

- Record earnings and assets under management ("AUM").

- Business conditions worsened in the final quarter of the reporting period.

- AUM increased 10% to £143.9 billion, average AUM increased by 16% to £138.6 billion.

- Net inflows of £5.0 billion, achieved across all asset classes, regions and client channels.

- Competitive firm-wide investment performance with three-year outperformance at 68%.

- Profit before tax increased 31% to £267.1 million. Adjusted operating profit increased 12% to £230.4 million.

- Basic earnings per share increased 34% to 22.6p and adjusted earnings per share increased 13% to 19.2p.

- Proposed final dividend of 7.7p per share, resulting in a full year dividend increasing 16% to 14.6p per share.

- Staff shareholding increased to 25.4%. 

Note: (1) Please refer to explanations and definitions on pages 12-15.

Hendrik du Toit, Founder and Chief Executive Officer, commented: 

"I am delighted to announce record earnings and assets under management after thirty one years in business. Over the reporting period Ninety One enjoyed strong support from our clients as reflected by net inflows of £5 billion. The combination of strategic clarity, disciplined execution, competitive long-term investment performance, a motivated, stable team and a long-term approach to business continues to work well for Ninety One. Business and market conditions have deteriorated towards the end of the reporting period and are expected to remain challenging. The spectre of inflation and rising interest rates in a world of supply chain disruption and increased political uncertainty speaks to volatile markets and a diminished risk appetite among end investors. In spite of these conditions, we have positive business momentum and see substantial long-term growth opportunities for Ninety One in the markets we serve. Our approach to value creation has not changed. We will continue to invest in our people and our business to deliver for our clients. With employee ownership now over 25% our commitment to long-term value creation for all stakeholders is clear."

For further information please contact:

Investor relations

Eva Hatfield eva.hatfield@ninetyone.com +44(0) 203 938 2908

Anindita Nag anindita,nag@ninetyone.com +44(0) 203 938 2114

Media

Media enquiries

Jeannie Dumas (for UK) jeannie.dumas@ninetyone.com +44 (0) 203 938 3084

Kotie Basson (for South Africa)   kotie.basson@ninetyone.com +27 (0) 82 375 1317

Investor presentation

A presentation to investors and financial analysts will be held at our London office (55 Gresham Street, EC2V 7EL) at 9.00 am BST on 18 May 2022. There will be a live webcast available for those unable to attend. The webcast registration link is available at www.ninetyone.com/full-year-results (password: NinetyOneFY22).

A copy of the presentation will be made available on the Company's website at https://ninetyone.com/full-year-results-2022 at 8.00 am BST.

Forward-looking statements

This announcement does not constitute or form part of any offer, advice, recommendation, invitation or inducement to any person to underwrite, subscribe for or otherwise acquire or dispose of securities in Ninety One plc and its subsidiaries or Ninety One Limited and its subsidiaries (together, "Ninety One"), nor should it be construed as legal, tax, financial, investment or accounting advice. 

This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements may be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "projects", "anticipates", "expects", "intends", "may", "will" or "should" or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. Forward-looking statements may and often do differ materially from actual results. Any forward-looking statements contained in the announcement reflect Ninety One's current view with respect to future events and are subject to risks relating to future events and other risks, uncertainties and assumptions relating to the Ninety One's business, results of operations, financial position, liquidity, prospects, growth and strategies. Forward-looking statements speak only as of the date of this announcement.

Except as required by any applicable law or regulation, Ninety One expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained in this announcement or any other forward-looking statements it may make whether as a result of new information, future developments or otherwise.

About Ninety One

Ninety One is an active investment manager, investing capital on behalf of its clients to help them achieve their long-term financial objectives. 

Ninety One is listed on the London and Johannesburg Stock Exchanges.

CHIEF EXECUTIVE OFFICER'S REVIEW

I am delighted to report record earnings and assets under management for the 2022 financial year. We thank our clients and other stakeholders for their continued support after 31 years in business,

This result reflects the robustness of our simple but diversified business model. We have reported 10% asset growth and net inflows of £5.0 billion over the year (2021: net outflows £0.2 billion). It is particularly pleasing that we achieved net inflows in each of the major asset classes, in all our regions and in both our client channels.

Our adjusted operating profit increased 12% to £230.4 million (2021: £206.2 million). The adjusted earnings per share increased 13%, while the basic earnings per share increased 34%. The Board has proposed a final dividend of 7.7p per share (2021: 6.7p), taking the full dividend to 14.6p per share, while maintaining a strong balance sheet.

We have recorded solid growth in the North American institutional market, as demonstrated by strong inflows. Similarly, in the UK, we are starting to see the results of our recent investments in this market. We continue to see growth opportunities in those regions. We have seen good momentum in South Africa, where we have a market-leading position. We believe this positions us well for the expected changes arising due to the exchange controls relaxation over the coming years. 

The ongoing travel restrictions have slowed down the implementation of our plans for China. In spite of the near-term obstacles we continue to see China as an opportunity for Ninety One over the long term.

Business conditions deteriorated markedly towards the end of the reporting period. The Russian invasion of Ukraine added substantial uncertainty to an environment challenged by rising inflation, expectations of interest rate increases and liquidity withdrawal amidst growing political uncertainty at geo-political level. At the end of the third quarter our short- and long-term investment performance numbers looked even more compelling than at interim stage. Unfortunately we were affected by the ensuing volatility in the final quarter. Firmwide investment performance remains competitive in market-relevant areas but there is room for improvement over the coming year.

We are mindful of the fact that our value proposition is a combination of competitive investment performance, relevant offerings and consistent strategy focused on the long term. At Ninety One our clients always come first and we have benefited from the opportunity to engage in person as well as virtually. Client activity has accordingly increased markedly over the second half of the year as many of our markets relaxed COVID restrictions. Our leadership and organisational stability allow us to look out and focus on markets and clients. Our stakeholders, once again, benefited from this over the reporting period.

In line with our stated purpose of investing for a better tomorrow through building a better firm, striving to invest better and actively contributing to a better world, our sustainability efforts have intensified over the past year. We have developed a strong and appropriately nuanced position on this topic, which has been incorporated in our transition plan.

During this reporting period we have continued to deliver on our commitment to put sustainability at the centre of our business. We have moved up a gear and implemented our new framework, Sustainability 3.0. Climate is our main priority given the existential nature of this threat. Our concern is real-world decarbonisation in line with our net zero commitment and not mere portfolio decarbonisation. This requires that we focus on an inclusive transition. At Ninety One, we believe that no one should be left behind in the race to net zero. Investors have a constructive role to play in the battle against climate change and in other dimensions of sustainability. Ninety One is working hard to contribute towards this, beyond advocacy, by deploying client capital sensibly and productively in pursuit of a more sustainable world.

Ours is a people-centric business model, reliant on a strong and healthy owner-culture to support our ability to attract and retain top talent. Diversity and inclusion are key pillars on which out employment proposition has been built. We encourage our people to be themselves and express their individuality, but always in a team context. Our culture remains strong and functions as the glue that binds us together. Our employees now own over a quarter of the equity in Ninety One. This is an indication of long-term orientation and appropriate alignment of interest with our stakeholders.

Our strategy is clear and our focus is on execution in these challenging market conditions. We are continuing to invest via the cost line to support our long-term organic growth. We have a solid platform for future growth, with a brand that is widely recognised, and a credible organic track record. We have made good progress on scaling some of our strategies, but there is more we can do on this front.

Outlook

At the interim stage we pointed to risks that could make market conditions less supportive than at the outset of this reporting period. Many of those have materialised and were accelerated by the Russian invasion of Ukraine. The coming year will be challenging and we enter it with appropriate levels of caution.

We continue to invest for long-term growth. Ninety One is a resilient business, with a diversified product offering and a track record of navigating a wide range of market conditions. We see ample growth opportunities ahead as long as we keep delivering for our clients and serve society at large. We will be actively involved in the move to a more sustainable future and in the financing of the impending transition. Our stated purpose is, after all, to invest for a better tomorrow.

Our focus remains firmly on execution. We look to the future with confidence.

OPERATING REVIEW

Assets under management ("AUM")

Closing AUM increased by 10% to £143.9 billion (31 March 2021: £130.9 billion), supported by net inflows and portfolio growth. The market and foreign exchange impact added £8.0 billion (2021: £27.7 billion).

AUM by asset class

Our AUM remained well diversified across asset classes, with the mix of AUM largely unchanged from the prior year. We achieved positive net flows in all asset classes.

AUM by Client Group

Overall, AUM remains well diversified by client geography ("Client Groups") and split remained broadly in line with the prior period. All regions benefited from net inflows.

AUM by client type

The split of AUM between the institutional and advisor channels remained broadly consistent with the prior year. This reflects the strong and stable relationships with our clients and our focus on growing and deepening our reach in both channels. AUM growth across both channels was driven by net inflows as well as portfolio growth.

Net flows

We achieved net inflows of £5.0 billion (2021: net outflows of £0.2 billion) in the financial year 2022. This was supported by investment performance and a general uplift in client activity across asset classes, especially in the first half of the financial year. The second half of the year saw a reduction in client risk appetite, compared with the first half, reflecting worsening geo-political events.

Net flows by asset class

We achieved net inflows in all asset classes. The largest generators of net inflows were the fixed income and equities asset classes. In fixed income, net inflows were driven by emerging market, Asian, African and total return currency strategies. In equities, we saw good inflows into global and thematic strategies. Multi-asset saw strong inflows in the South African strategies. Inflows in Alternatives were driven by the growing interest in our Multi-asset Credit strategies and inflows into our SA fund platform remained healthy.

Net flows by Client Group

We achieved net inflows in all Client Groups, with the Africa and Americas Client Groups generating the majority of the net flows over the year. Africa Client Group achieved strong net inflows from South African multi-asset and global equity strategies, as well as inflows into the South African fund platform. Americas Client Group saw strong net flows from North American, mainly institutional, clients. The Europe Client Group experienced strong net inflows from fixed income strategies, while the Asia Pacific Client Group saw net inflows into global and emerging equities as well as fixed income strategies. Net inflows into the UK Client Group were driven by global (including thematic) equities strategies.

Net flows by client type

The advisor channel saw particularly strong net inflows from the Africa and UK Client Groups, largely into global and thematic equity strategies. Institutional net inflows were driven by the Europe, Americas and Asia Pacific Client Groups, into fixed income strategies.

Investment performance

Firm-wide investment performance(1)

Throughout most of the financial year 2022, our firm-wide investment performance remained competitive and displayed an improving trend. As at the end of December 2021, our one- and three-year outperformance stood at 72% and 89% respectively. This compared favourably with the numbers for the half year to 30 September 2021 (66% and 77% for one- and three-year firm-wide outperformance respectively).

However, the volatile conditions following the market correction during the Russian invasion of Ukraine resulted in a number of our larger strategies dropping below their benchmarks. As a result, the firm-wide outperformance deteriorated, resulting in the one- and three-year firm-wide outperformance closing at 50% and 68% respectively, as at 31 March 2022 (31 March 2021: 80% and 82% respectively). Notwithstanding this, our long-term firm-wide investment performance remains robust.

Note: (1) Firm-wide outperformance is calculated as the sum of the total market values for individual portfolios that have positive active returns on a gross basis expressed as a percentage of total AUM. Our percentage of firm outperformance is reported on the basis of current AUM and therefore does not include terminated funds. Total AUM excludes double-counting of pooled products and third party assets administered on our South African fund platform. Benchmarks used for the above analysis include cash, peer group averages, inflation and market indices as specified in client mandates or fund prospectuses. For all periods shown, market values are as at the period end date.

Mutual fund investment performance(1)

During the financial year 2022, Ninety One's mutual fund investment performance on a one- and three-year basis deteriorated, with 36% and 49% of mutual funds in the first or second quartiles respectively (31 March 2021: 43% and 51% respectively). However, on a five- and ten-year basis, mutual fund performance improved, with 57% and 70% of mutual funds in the first or second quartile respectively (31 March 2021: 50% and 59% respectively).

Note: (1) Mutual fund performance and ranking as per Morningstar data using primary share classes, as defined by Morningstar, net of fees to 31 March 2022. Peer group universes are either Investment Association, Morningstar Categories or ASISA sectors as classified by Morningstar. Cash or cash-equivalent funds are excluded from the tables. Mutual fund performance weighted by AUM. Percentages may not add up to 100% due to rounding.

FINANCIAL REVIEW

Financial results(1)

Note: (1) Please refer to explanations and definitions, including alternative performance measures, on pages 12 to 15.

Adjusted operating profit increased 12% to £230.4 million (2021: £206.2 million). Adjusted operating profit margin of 34.7% increased on the comparative period (2021: 34.2%), principally due to an increase in management fees. Profit before tax and exceptional items increased 20% to £252.2 million (2021: £210.1 million).

Assets under management

Ninety One saw net inflows of £5.0 billion (2021: net outflows of £0.2 billion). Total AUM increased by 10% to £143.9 billion (31 March 2021: £130.9 billion), reflecting the net inflows and positive markets. The market and foreign exchange impact for the year was £8.0 billion (2021: £27.7 billion).

Average AUM increased 16% to £138.6 billion (2021: £119.9 billion), reflecting higher AUM levels over the year. 

Adjusted operating revenue

Management fees increased 13% to £632.8 million (2021: £561.0 million), against a 16% increase in average AUM. The average management fee rate reduced 1.1 bps to 45.7 bps (2021: 46.8bps). This is largely due to a change in the mix of strategies owned by our clients and is unchanged in the second half of the year.

Performance fees decreased to £31.1 million (2021: £45.4 million) compared to higher levels achieved in the prior year. These fees arose due to relative investment outperformance in a selection of strategies, particularly in South African equities.

The foreign exchange gain of £1.2 million (2021: loss of £6.3 million) was mainly due to US dollar asset translations where the pound sterling weakened against the US dollar. The year-end exchange rate moved from 1.38 in 2021 to 1.34 in 2022.

The other loss of £1.2 million was negative compared to the comparative period (2021: gain of £3.4 million), mainly due to seed capital mark-to-market revaluations.

Adjusted operating expenses

Adjusted operating expenses increased 9% to £433.5 million (2021: £397.3 million), driven by increases in both employee remuneration and business expenses.

Employee remuneration

Ninety One is a people business, and employee remuneration represents the largest portion of the expense base. Total employee remuneration (excluding Silica and the impact of the revaluation of the deferred employee benefit scheme) increased 9% to £294.4 million (2021: £271.3 million). This was principally driven by variable remuneration, in line with adjusted operating profit growth, along with an increase of 1% in average headcount to 1,182 (2021: 1,168). The compensation ratio decreased to 44% (2021: 45%).

Over 50% of employee remuneration is variable and fluctuates in line with adjusted operating profit, ensuring alignment with financial performance. 

Business expenses

Business expenses increased 10% to £139.1 million (2021: £126.0 million). The largest expense item, client and retail fund administration, increased in line with higher average AUM and the impact of the stronger South African rand on South Africa based costs. Travel and promotional expenses have increased from prior year given the easing of COVID-19 related restrictions.

Adjusted net interest income

Adjusted net interest income increased to £3.7 million (2021: £2.2 million) as a result of higher average cash balances in 2022, particularly in Southern Africa. Adjusted net interest income excludes interest expense on lease liabilities of £3.8 million (2021: £3.7 million), which has been included in adjusted operating expenses.

Share scheme net credit

The share scheme net credit has arisen as a result of employees opting to invest a significant portion of their deferred bonuses into the Ninety One share scheme. Under IFRS2, such allocations are amortised over the vesting period. To reflect the adjusted operating expenses as though all awards during the year were expensed, the gross allocation value less amortisation charges ("share scheme net credit") was excluded from adjusted operating expenses. The share scheme net credit was relatively immaterial in the prior year and was included in adjusted operating expenses.

 Exceptional items

Exceptional income of £14.9 million (2021: expenses of £6.0 million) reflects the pre-tax profit received on the sale of Silica in April 2021. Silica is a transfer agency business in South Africa. During financial year 2021, we took a strategic decision to dispose of Silica, further simplifying our business. The sale, which completed on 30 April 2021, will allow Silica to work with a strong and strategically-aligned partner, FNZ, and allow Ninety One to focus on its core investment management business. Ninety One remains a client of Silica.

In 2021, exceptional expenses largely reflected the spend relating to the completion of the rebranding of Ninety One.

Profit before tax 

Profit before tax increased 31% to £267.1 million (2021: £204.1 million), while adjusted operating profit increased 12% to £230.4 million (2021: £206.2 million). The reason for the difference in these increases is the profit on sale of Silica and the share scheme net credit, neither of which are reflective of operating performance for the year.

Effective tax rate

The effective tax rate for the twelve months to 31 March 2022 was 23.1% (2021: 24.3%), against a headline UK corporation tax rate of 19.0% (2021: 19.0%) and a headline South Africa corporation tax rate of 28.0% (2021: 28.0%). The decrease is primarily due to the inclusion of adjustments in the prior year.

Earnings per share

Note: (1) This comprises a component of "non-operating items" per adjusted earnings per share definition on page 15. Please refer to explanations and definitions, including alternative performance measures, on pages 12 to 15.

Basic earnings per share ("Basic EPS") and diluted EPS increased 34% and 33% to 22.6p and 22.4p respectively (2021: 16.9p and 16.8p respectively). Basic headline EPS ("Basic HEPS") and diluted HEPS increased 27% and 26% to 21.4p and 21.1p respectively (2021: 16.9p and 16.8p respectively). Adjusted EPS grew broadly in line with adjusted operating profit by 13% to 19.2p (2021: 17.0p), which is reflective of the core operating performance of Ninety One, as set out under alternative performance measures on pages 12 and 13.

There was no change in the number of shares in issue. The impact of the investment in own shares held by Ninety One as part of the Ninety One share scheme had a small impact on the weighted average number of ordinary shares.

For details on calculations, see note 8 to the condensed consolidated financial statements.

Summary balance sheet 

Assets and liabilities

Ninety One undertakes investment-linked insurance business through one of its South African entities, Ninety One Assurance, and does not take on any insurance risk in respect of such business. The policyholders hold units in a pooled portfolio of assets via linked policies issued by the insurance entity. The assets are beneficially held by the insurance entity and the assets are reflected on its statement of financial position. Due to the nature of a linked policy, Ninety One's liability to the policyholders is equal to the market value of the assets underlying the policies, less applicable taxation. The increase in policyholder assets is largely due to foreign exchange gains and improved markets. The commentary below only covers the shareholders' amounts.

Total assets increased to £829.6 million (31 March 2021: £789.7 million), largely due to cash and cash equivalents which increased to £406.6 million (31 March 2021: £337.5 million).

Ninety One has limited seed investments. Seed capital for mutual funds was £2.7 million (31 March 2021: £3.1 million) and co-investments in private equity and real estate funds totalled £6.3 million (31 March 2021: £8.2 million). 

Total liabilities decreased to £488.0 million (31 March 2021: £536.4 million). There is no debt financing on the balance sheet.

Equity increased to £341.6 million (31 March 2021: £253.3 million), reflecting the profits for the year, net of the payment of the interim dividend and the prior year final dividend.

Ninety One has established employee benefit trusts for the purpose of purchasing shares and satisfying the share-based payment awards granted to employees. Over the financial year, 6.8 million shares were purchased through these trusts and 0.2 million shares were released to employees, resulting in a total of 17.6 million shares, representing 1.9% of Ninety One's 922.7 million total shares in issue.

Capital and regulatory position(1)

Notes:

(1) The above table represents the amalgamated position across Ninety One plc and its subsidiaries and Ninety One Limited and its subsidiaries, which for regulatory capital purposes are separate groups. Both groups had an estimated capital surplus at 31 March 2022 and 31 March 2021.

(2) Non-qualifying assets comprise assets that are not available to meet regulatory requirements.

(3) Estimated regulatory requirement at 31 March 2022 under the BIPRU regime is the requirement calculated as at 31 December 2021, the last date the BIPRU rules applied.

Estimated regulatory capital required increased to £114.2million (31 March 2021: £104.4 million). Ninety One has an expected capital surplus of £128.8 million (31 March 2021: £73.9 million), which is consistent with our commitment to a capital-light balance sheet. This means Ninety One holds a capital cover of 213% of its capital requirement (2021: 172%). The capital requirements for all Ninety One companies are monitored throughout the year.

Dividends

The Board has considered the resilience of the balance sheet. In line with the stated dividend policy, the Board has recommended a final dividend of 7.7p per share. Of this, 4.8p per share represents 50% of profit after tax prior to the recognition of non-operating items and 2.9p per share represents after-tax earnings after ensuring we have sufficient capital to meet current or expected changes in the regulatory capital requirements and investment needs, as well as a reasonable buffer to protect against fluctuations in those requirements. If approved at the AGM, the final dividend will be paid on 5 August 2022 to shareholders included on the share registers on 15 July 2022 and will result in a full-year dividend of 14.6p per share (2021: 12.6p).

There are no plans to increase the current number of shares in issue.

Liquidity

Ninety One maintains a healthy liquidity position, which comprises cash and cash equivalents of £406.6 million (31 March 2021: £337.5 million). Ninety One maintains a consistent liquidity management model, with liquidity requirements monitored carefully against its existing and longer-term obligations. To meet the daily requirements of the business and to mitigate its credit exposure, Ninety One diversifies its cash and cash equivalents across a range of suitably credit-rated corporate banks and money funds.

Alternative performance measures

Ninety One uses non-IFRS measures to reflect the manner in which management monitors and assesses the financial performance of Ninety One.

Items are included or excluded from adjusted operating revenue and expenses based on management's assessment of whether they contribute to the core operations of the business. In particular:

- they exclude Silica as it is not core to Ninety One's asset management activities and as at 30 April 2021 has been divested;

- foreign exchange differences are included as they mainly relate to operating matters;

- net gains or losses on investments are included as, other than those related to deferred employee benefit schemes and excluded as noted below, investments are generally seed capital funding which is directly attributable to operations;

- deferred employee benefit scheme movements are excluded as the movements offset and do not impact operating performance;

- subletting income is deducted from adjusted operating expenses as it is a recovery of costs rather than a core revenue item;

- the share scheme net credit is excluded from adjusted operating expenses so that they reflect the position as though all awards during the year were expensed; and

- interest expense on lease liabilities is included in adjusted operating expenses to reflect the operating costs of offices.

These non-IFRS measures are considered additional disclosures and in no case are intended to replace the financial information prepared in accordance with the basis of preparation detailed in the condensed consolidated financial statements. Moreover, the way in which Ninety One defines and calculates these measures may differ from the way in which these or similar measures are calculated by other entities. Accordingly, they may not be comparable to measures used by other entities in Ninety One's industry.

These non-IFRS measures are considered to be pro forma financial information for the purpose of the JSE Listings Requirements and are the responsibility of Ninety One's Board. Due to their nature, they may not fairly present the issuer's financial position, changes in equity, results of operations or cash flows. The non-IFRS financial information has been prepared with reference to JSE Guidance Letter: Presentation of pro forma financial information dated 4 March 2010 and in accordance with paragraphs 8.15 to 8.33 in the JSE Listings Requirements, the Revised SAICA Guide on Pro forma Financial Information (issued September 2014) and International Standard on Assurance Engagement ("ISAE") 3420 - Assurance Engagements to Report on the Compilation of Pro forma Financial Information included in a Prospectus, to the extent applicable given the Non-IFRS Financial Information's nature. This pro forma financial information has been reported on by KPMG Inc in terms of ISAE 3420 and their unmodified report is available for inspection on the Ninety One website (www.ninetyone.com).

These non-IFRS measures, including reconciliations to their nearest condensed consolidated financial statements equivalents, are as follows:

Foreign currency

The financial information is prepared in British pound sterling. The results of operations and the financial condition of individual companies are reported in the local currencies of the countries in which they are domiciled, including South African rand and US dollar. These results are then translated into pounds sterling at the applicable foreign currency exchange rates for inclusion in the condensed consolidated financial statements. The following table sets out the movement in the relevant exchange rates against pounds sterling for the twelve months ended 31 March 2021 and 2022.

DEFINITIONS

Adjusted earnings per share: Profit attributable to ordinary shareholders, adjusted to remove non-operating items, divided by the number of ordinary shares in issue at the end of the period

Adjusted net interest income: Calculated as net interest income less interest expenses from lease liabilities for office premises, and other interest expense

Adjusted operating expenses: Calculated as operating expenses less deferred employee benefit scheme movements and share scheme net credit, but including interest expense on lease liabilities

Adjusted operating profit: Calculated as adjusted operating revenue less adjusted operating expenses

Adjusted operating profit margin: Calculated as adjusted operating profit divided by adjusted operating revenue

Adjusted operating revenue: Calculated as net revenue adjusted for foreign exchange gains/losses, deferred employee benefit scheme movements, net gain/loss on investments and other items

Assets under management (AUM): The aggregate assets managed on behalf of clients. For some private markets' investments, the aggregate value of assets managed is based on committed funds by clients; this is changed to the lower of committed funds and net asset value, in line with the fee basis. Where cross investment occurs, assets and flows are identified, and the duplication is removed. AUM excludes assets administered for third-party clients by Silica

Average AUM: Calculated as a 13-point average of opening AUM for the year, and the month end AUM for each of the subsequent 12 months

Average exchange rate: Calculated as the average of the daily closing spot exchange rates in the relevant period

Average fee rate: Management fees divided by average AUM (annualised for non-twelve month periods), expressed in basis points

Basic earnings per share (Basic EPS): Profit attributable to ordinary shareholders divided by the weighted average number of ordinary shares outstanding during the period, excluding own shares held by Ninety One share schemes

BIPRU: The Prudential Sourcebook for Banks, Building Societies and Investment Firms promulgated by the UK Financial Services Authority, as was in effect from time to time

Diluted earnings per share: Profit for the period attributable to ordinary shareholders divided by the weighted average number of ordinary shares outstanding during the period, plus the weighted average number of ordinary shares that would be issued on the conversion of all the potentially dilutive shares into ordinary shares

Headline earnings per share (HEPS): Ninety One is required to calculate HEPS in accordance with JSE Listings Requirements, determined by reference to circular 1/2021 "Headline Earnings" issued by the South African Institute of Chartered Accountants

IFPR: Investment Firm Prudential Regime, which came into force in UK on 1 January 2022

JSE: Johannesburg Stock Exchange, the exchange operated by the JSE Limited, a public company incorporated and registered in South Africa, under the Financial Markets Act

LSE: London Stock Exchange, the securities exchange operated by the London Stock Exchange plc under the Financial Services and Markets Act 2000, as amended

Net flows: The increase in AUM received from clients, less the decrease in AUM withdrawn by clients, during a given period. Where cross investment occurs, assets and flows are identified, and the duplication is removed

Net revenue: Represents revenue in accordance with IFRS, less commission expense

Non-operating items: Include exceptional items, share scheme net credit, adjusted net interest income and tax on adjusting items

REVIEW REPORT

The condensed consolidated financial statements, which comprise the condensed consolidated statement of financial position at 31 March 2022 and the condensed consolidated statement of comprehensive income, the condensed consolidated statement of changes in equity and the condensed consolidated statement of cash flows for the year then ended and the notes to such condensed consolidated financial statements, and the annexure to the condensed consolidated financial statements, have been reviewed by KPMG Inc., in accordance with the requirements of the JSE Limited Listings Requirements, as set out in note 1 to the condensed consolidated financial statements, and the requirements of the Companies Act of South Africa, who expressed an unmodified review conclusion. The auditor's report does not necessarily report on all of the information contained in these financial results. Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor's engagement, they should obtain a copy of the auditor's report together with the accompanying financial information from the company's website (https://ninetyone.com/full-year-results-2022) or its registered office.

Preparation of condensed consolidated financial statements

These condensed consolidated financial statements have been prepared by management under the supervision of the Finance Director, Kim McFarland CA(SA). The board of directors take full responsibility for the preparation of the condensed consolidated financial statements.

On behalf of the board of directors

Hendrik du Toit Kim McFarland

Chief Executive Officer Finance Director

17 May 2022 17 May 2022

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 March 2022

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 31 March 2022

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 March 2022

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 March 2022

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the year ended 31 March 2022

General information

Ninety One operates as a dual-listed company ("DLC") under a DLC structure. The DLC structure comprises Ninety One plc, a public company incorporated in England and Wales under the UK Companies Act 2006 and Ninety One Limited, a public company incorporated in South Africa under the South African Companies Act 71 of 2008. Under the DLC structure, Ninety One plc and Ninety One Limited, together with their direct and indirect subsidiaries, effectively form a single economic enterprise (the "Group") in which the economic and voting rights of ordinary shareholders of the companies are maintained in equilibrium relative to each other. The Group is listed on the London and Johannesburg Stock Exchanges.

The condensed consolidated financial statements for the year ended 31 March 2022 have been prepared in accordance with:

- the JSE Limited's Listings Requirements and the requirements of the Companies Act of South Africa;

- UK-adopted international accounting standards and with International Financial Reporting Standards as issued by the International Accounting Standards Board ("IASB") (collectively "IFRS") since the latter is identical in all material respects;

- the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the Financial Reporting Standards Council and to also, as a minimum, contain the information required by IAS 34 Interim Financial Reporting;

- the accounting policies and significant judgements and estimates applied in the preparation of the condensed consolidated financial statements which are in terms of IFRS and consistent with those applied for the year ended 31 March 2021; and

- the requirements in UK Listing Rule R 9.7A with regards the preparation of preliminary statements of annual results.

The condensed consolidated financial statements have been prepared on the historical cost basis with the exception of linked investments backing policyholder funds, policyholder investment contract liabilities, investments and the pension fund obligation which have been presented on a fair value basis.

The presentation currency of the Group is pounds sterling ("£"), being the functional currency of Ninety One plc. The functional currency of Ninety One Limited is South African rand. All values are rounded to the nearest million ("£'m"), unless otherwise indicated.

The presentation of profit or loss and other comprehensive income has been changed in the current period to combine a separate income statement and statement of other comprehensive income into a single statement of comprehensive income. The purpose of the change is to improve the readability of the condensed consolidated financial statements.

Foreign operations are subsidiaries and interests in associated undertakings of the Group, the activities of which are based in a functional currency other than that of the reporting entity. The functional currency of an entity is determined based on the primary economic environment in which the entity operates. Foreign currency transactions are translated into the functional currency of the entity in which the transactions arise, based on rates of exchange ruling at the date of the transactions.

This provisional announcement does not constitute the Group's full consolidated financial statements for the year ended 31 March 2022. The Group's full consolidated financial statements will be approved by the board of directors, reported on by the auditors and published in June 2022. Accordingly, the financial information for the year ended 31 March 2022 is presented unaudited in this preliminary announcement to satisfy UK reporting requirements and is presented as reviewed in this provisional announcement to satisfy the JSE Limited Listings Requirements in South Africa.

The preliminary announcement also does not constitute Ninety One plc's statutory accounts in the UK for the years ended 31 March 2022 or 2021. The financial information for 2021 is derived from the UK statutory accounts for 2021 which have been delivered to the UK's registrar of companies. The auditor has reported on the 2021 accounts; their report was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. The UK statutory accounts for 2022 will be finalised on the basis of the financial information presented by the directors in this preliminary announcement and will be delivered to the UK's registrar of companies in due course.

Going concern

The board of directors have considered the resilience of the Group and taking into account its current financial position and the principal and emerging risks facing the business, including the impacts of the events and market conditions arising from the war in Ukraine have had on the Group's financial performance. The board of directors have performed a going concern assessment by applying various stressed scenarios, including plausible downside assumptions, about the impact on assets under management, profitability of the Group and known commitments. All scenarios show that the Group would maintain sufficient resources to enable it to continue operating profitably for a period of at least 12 months from the date of the release of these results. The condensed consolidated financial statements have therefore been prepared on a going concern basis.

Revenue primarily consists of management fees and performance fees derived from investment management activities. As an integrated global investment manager, the Group operates a single-segment investment management business. All financial, business and strategic decisions are made centrally by the chief operating decision maker (the "CODM") of the Group. The CODM is the chief executive officer of the Group from time to time. Reporting provided to the CODM is on an aggregated basis which is used for evaluating the Group's performance and the allocation of resources. The CODM monitors operating profit for the purpose of making decisions about resource allocation and performance assessment. Revenue is disaggregated by geographic location of contractual entities, as this best depicts how the nature, amount, timing and uncertainty of the Group's revenue and cash flows are affected by economic factors. Revenue is generated from a diversified customer base and the Group has no single customer that it relies on. Non-current assets other than financial instruments and deferred tax assets are allocated based on where the assets are physically located.