Ninety One Regulatory News (N91)

Interim results for the six months to 30 September 2021

16 November 2021

Highlights

‒ Record first half and positive business momentum.

‒ Closing assets under management increased by 7% in the six months, to £140.0 billion.

‒ Net inflows of £3.9 billion. 

‒ Competitive investment performance with three-year outperformance at 77%.

‒ Profit before tax increased by 39% to £132.1 million, including proceeds of £14.9 million from the sale of Silica. Adjusted operating profit increased by 20% to £115.6 million.

‒ Basic earnings per share increased by 42% to 11.2p and adjusted earnings per share increased by 21% to 9.7p.

‒ Interim dividend of 6.9p per share.

‒ Staff shareholding increased to 24.5%.

Note: (1) Please refer to explanations and definitions on pages 12-14.

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

"The combination of strategic clarity, disciplined execution, competitive investment performance, a motivated, stable team and a long-term approach to business continues to work well for Ninety One. While the supportive market conditions of this reporting period will not last indefinitely, we see substantial long-term growth opportunities ahead. We will continue to invest in our people and our business so that we can deliver for our clients. This remains our formula for value creation."

For further information please contact:

Investor relations

Varuni Dharma varuni.dharma@ninetyone.com +44(0) 203 938 2486

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

Media

Media enquiries

Jeannie Dumas (for UK) jeannie.dumas@ninetyone.com +44 (0) 793 170 7108

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 (UK time) on 16 November 2021. There will be a live webcast available for those unable to attend. The webcast registration link is available at www.ninetyone.com/interim-results (password: NinetyOneH122).

A copy of the presentation will be made available on the Company's website at https://ninetyone.com/interim-results-2022 at 8.00 am (UK time).

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 independent investment manager, founded in South Africa in 1991. It now operates and invests globally and offers a range of active strategies to its global client base.

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

CHIEF EXECUTIVE OFFICER'S REVIEW

I am delighted to report a record first half for the 2022 financial year. It is also my privilege to thank all our stakeholders for their support during this period.

A combination of competitive investment performance, relevant offerings and a stable organisation translated into record earnings, record assets under management and strong net inflows.

At Ninety One, our clients always come first and we have benefited from the opportunity to engage them in person as well as virtually. We are stepping up our client engagement in the second half of the year. The combination of organisational stability and strategic clarity allows us to focus on what is really important in this business - serving our clients.

Our people-centric business model with its strong owner culture supports our ability to attract and retain the talent required in the brutally competitive investment management industry. Over the reporting period we have actively engaged our people to ensure that we remain aligned and focused on our long-term objectives. Our culture remains strong and functions as the glue that binds us together. As indicated at listing, employees have continued to increase their collective stake in Ninety One. This underlines our commitment and aligns us with our stakeholders.

Our sustainability efforts have intensified. We have developed strong and appropriately nuanced positions on this topic.

The strategic clarity at Ninety One allows us to focus much of our energy on execution. That remains our priority. We have not changed or revised our strategy since our last financial year end and do not expect to change this in the near term.

We thank Fani Titi for his valued contribution to the board and welcome Khumo Shuenyane in his place as a non-executive director.

Outlook

Although the current market conditions remain supportive, there are a range of risk factors that can change this. Geopolitical uncertainty, COVID-19, economic protectionism, climate and inflation may affect future earnings potential.

Nevertheless, we continue to invest for long-term growth. Ninety One remains well-positioned as a diversified business with leadership stability and strategic clarity. Our focus remains firmly on execution. We see ample opportunities for growth if we continue to deliver for our clients. We look to the future with confidence.

OPERATING REVIEW

Assets under management ("AUM")

Closing AUM increased by 7% to £140.0 billion (31 March 2021: £130.9 billion), supported by strong net inflows and portfolio growth. The market and foreign exchange impact in the first half added £5.2 billion (H1 2021: £15.9 billion).

AUM by asset class

AUM increased across all asset classes and remained well diversified in line with the prior period.

AUM by Client Group

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

AUM by client type

AUM across both the advisor and institutional channels saw good growth in the first half, with both achieving strong net inflows in the period.

Net flows

In the first half, we experienced net inflows of £3.9 billion (H1 2021: net outflows of £0.3 billion). This was supported by investment performance and a general uplift in client activity across asset classes off the back of increased client risk appetite.

Net flows by asset class

Ninety One generated net inflows in the first half, in contrast to the net outflows in the comparable period. The largest generators of net inflows were the fixed income and equities asset classes. In fixed income, net inflows were driven by emerging market, corporate and sovereign strategies. In equities, we saw significant inflows into global and thematic strategies. Multi-asset net outflows were driven by redemptions from diversified growth strategies.

Net flows by Client Group

We achieved positive net inflows in all Client Groups. The largest net inflows were in the Asia Pacific Client Group, principally driven by global equity strategies. The Europe Client Group experienced strong net inflows from fixed income strategies, while the Africa Client Group achieved strong net inflows from various South African multi-asset strategies and into the South African fund platform. Net inflows into the UK Client Group were driven by global (including thematic) equities, while those of the Americas Client Group were driven by global equities.

Net flows by client type

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

Investment performance

Firm-wide investment performance(1)

During the first half of financial year 2022, short- and medium-term firm-wide investment performance reduced compared to the strong investment performance at the end of financial year 2021. As at the end of September 2021, our one- and three-year outperformance stood at 66% and 77% respectively (31 March 2021: 80% and 82% respectively). Long-term firm-wide investment performance remained strong and broadly in line with the numbers for the year ended 31 March 2021 (of 83% and 89% outperformance over five and ten years respectively).

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 first half of financial year 2022, Ninety One's mutual fund investment performance on a one-year basis remained broadly unchanged with 42% of mutual funds in the first or second quartiles (31 March 2021: 43%). However, on a three- and five-year basis, mutual fund performance improved significantly, with 65% and 74% of mutual funds in the first or second quartile respectively (31 March 2021: 51% and 50% respectively). Outperformance over ten years was 87% (31 March 2021: 59%), demonstrating our ability to generate good outcomes for our clients over the medium to long term.

Note: (1) Mutual fund performance and ranking as per Morningstar data using primary share classes, as defined by Morningstar, net of fees to 30 September 2021. 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.

FINANCIAL REVIEW

Financial results(1)

Note: (1) Please refer to explanations and definitions on pages 12-14.

Our adjusted operating profit increased by 20% to £115.6 million (H1 2021: £96.2 million). Adjusted operating profit margin of 35.2% increased on the prior period (H1 2021: 33.3%), principally due to an increase in management fees. Profit before tax and exceptional items increased by 20% to £117.2 million (H1 2021: £97.7 million).

Assets under management

Ninety One saw net inflows of £3.9 billion (H1 2021: net outflows of £0.3 billion). Closing AUM increased by 7% to £140.0 billion (31 March 2021: £130.9 billion), reflecting net inflows in the period and portfolio growth. The market and foreign exchange impact for the period was £5.2 billion (H1 2021: £15.9 billion).

Average AUM increased by 20% to £137.5 billion (H1 2021: £114.2 billion), reflecting higher AUM levels over the period.

Adjusted operating revenue

Management fees increased by 16% to £314.8 million (H1 2021: £270.4 million), against a 20% increase in average AUM. The average management fee rate reduced by 1.5bps to 45.7bps (H1 2021: 47.2bps). This is largely due to a change in the mix of strategies owned by our clients. We maintained our price discipline.

Performance fees decreased to £13.6 million (H1 2021: £18.0 million) reflecting lower but still positive investment outperformance in a selection of strategies, particularly in South African equities.

Foreign exchange losses of £0.3 million (H1 2021: £2.2 million) were mainly due to US dollar asset translations where the pound sterling strengthened against the US dollar. The period-end exchange rate moved from 1.29 as at 30 September 2020 to 1.34 as at 30 September 2021.

Other income of £0.3 million was lower compared to the prior period (H1 2021: £2.6 million), due to a decrease in seed capital mark-to-market revaluations.

Adjusted operating expenses

Adjusted operating expenses increased by 10% to £212.8 million (H1 2021: £192.6 million), largely driven by a 14% increase in employee remuneration. Business expenses increased by 4%.

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 by 14% to £145.8 million (H1 2021: £128.2 million). This was principally driven by variable remuneration, in line with adjusted operating profit growth. The average headcount increased by 1% to 1,182 (H1 2021: 1,166). This along with inflation and market-related adjustments had a lesser impact on the overall remuneration expense growth.

Over 50% of employee remuneration is variable and fluctuates in line with our profitability, ensuring alignment with financial performance.

Business expenses

Business expenses increased by 4% to £67.0 million (H1 2021: £64.4 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 remained lower, reflecting continued COVID-19 restrictions. Accommodation expenses reduced following the completion of office moves compared to the prior period which included duplicate rental expenses.

Adjusted net interest income

Adjusted net interest income increased to £1.6 million (H1 2021: £1.0 million) as a result of higher interest rates. Adjusted net interest income excludes interest expense on lease liabilities of £1.9 million (H1 2021: £1.8 million), which has been included in adjusted operating expenses.

Exceptional items

Exceptional income of £14.9 million (H1 2021: expenses of £2.9 million) reflects the pre-tax profit received on the sale of Silica in April 2021. Silica was our transfer agency business in South Africa and its profits were typically reinvested into its core operational platforms. 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 the Silica business.

In the first half of financial year 2021, exceptional expenses reflected the spend related to the completion of the rebranding of Ninety One.

Profit before tax

Profit before tax increased by 39% to £132.1 million (H1 2021: £94.8 million), while adjusted operating profit increased by 20% to £115.6 million (H1 2021: £96.2 million). The reason for the difference in these increases is the profit on the sale of Silica.

Effective tax rate

The effective tax rate for the six months to 30 September 2021 was similar to the prior period at 23.2% (H1 2021: 23.3%), against a headline UK corporation tax rate of 19.0% (H1 2021: 19.0%) and a headline South Africa corporation tax rate of 28.0% (H1 2021: 28.0%).

Earnings per share

Note: (1) This comprises a component of "non-operating items" per adjusted earnings per share definition on page 14.

Basic earnings per share ("Basic EPS") increased by 42% to 11.2p (H1 2021: 7.9p), and basic and diluted headline EPS ("Basic HEPS") increased by 25% to 9.9p (H1 2021: 7.9p). 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 new Ninety One share scheme had a small impact on the weighted average number of ordinary shares.

Adjusted EPS grew 21% to 9.7p (H1 2021: 8.0p), broadly consistent with the growth in adjusted operating profit and more reflective of the core operating performance of Ninety One.

For details on calculations, see note 8 to the interim 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 decreased to £758.7 million (31 March 2021: £789.7 million), largely due to cash and cash equivalents which decreased to £305.2 million (31 March 2021: £337.5 million), following payment of variable compensation in April 2021, and dividends in August 2021.

Ninety One has limited seed investments. Seed capital for mutual funds was £3.3 million (31 March 2021: £3.1 million) and co-investments totalled £8.4 million (31 March 2021: £8.2 million).

The decrease in total liabilities to £471.9 million (31 March 2021: £536.4 million) mainly reflected that bonus provisions are for a half year period only. There is no debt financing on the balance sheet.

Equity increased to £286.8 million (31 March 2021: £253.3 million), reflecting the profits in the period.

Previously, Ninety One established employee benefit trusts for the purpose of purchasing shares and satisfying the share-based payment awards granted to employees. Over the first half of the financial year, 5.1 million shares were purchased through these trusts, resulting in a total of 15.8 million shares, representing 1.7% 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 of companies had an estimated capital surplus at 31 March 2021 and 30 September 2021 .

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

Estimated regulatory capital increased to £104.6 million (31 March 2021: £104.4 million). This provides Ninety One with an expected capital surplus of £106.2 million (31 March 2021: £73.9 million), which is consistent with our commitment to a capital-light balance sheet, whilst maintaining a reasonable capital buffer. The capital requirements for all Ninety One companies are monitored throughout the year.

Dividends

The Board has considered the resilience of the balance sheet and the outlook for the remainder of the year. In line with our stated dividend policy the Board has declared an interim dividend of 6.9 pence per share. This comprises of 4.9 pence per share which represents 50% of profit after tax, prior to the recognition of non-operating items (the sale of Silica) and a further 2.0 pence per share. This 2.0 pence per share represents after tax earnings available after ensuring that there is sufficient capital to meet current or expected changes in the regulatory capital requirements and investment needs. The interim dividend will be paid on 17 December 2021 to shareholders recorded on the UK and South African share registers on 3 December 2021.

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 £305.2 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. Ninety One excludes Silica which was sold on 30 April 2021. 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 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 of directors. The pro forma financial information has not been reviewed or reported on by Ninety One's auditor. 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 and the Revised SAICA Guide on Pro forma Financial Information (issued September 2014).

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

Foreign currency

Ninety One prepares its financial information in British pound sterling. The results of operations and the financial condition of Ninety One's 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 pound sterling at the applicable foreign currency exchange rates for inclusion in the interim condensed consolidated financial statements. The following table sets out the movement in the relevant exchange rates against pound sterling for the six month periods ended 30 September 2021 and 2020, as well as twelve months ended 31 March 2021.

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 income arising from Silica operations, interest expenses from lease liabilities for office premises, and other interest expense

Adjusted operating expenses: Calculated as operating expenses less Silica net expenses and deferred employee benefit scheme movements, 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, less Silica third-party revenue and 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 after tax 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

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

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, adjusted net interest income, Silica profit and tax on adjusting items

PRINCIPAL RISKS AND UNCERTAINTIES

Ninety One faces a number of risks in the normal course of business. Our Board has the ultimate responsibility for risk management. It approves Ninety One's risk appetite and general risk management framework and monitors the operation of the framework.

The risk management framework is utilised across all categories of risk within Ninety One and employs tools including risk assessments, key indicators, stress and scenario tests and learnings from internal and external events. This informs business decisions, helps direct resources and helps to ensure Ninety One is appropriately capitalised.

There have been no significant changes to our risk management approach in the period. The principal risks faced by the Group remain unchanged since the year end and continue to be our principal risks for the second half of the financial year. These comprise business and strategic risks, investments risks and operational risks. A detailed description of each, including an overview of our risk management and mitigation approach, is disclosed on pages 49 to 55 of our Integrated Annual Report 2021, which can be accessed via the Investor Relations home page on our website at www.ninetyone.com. In addition, we continue to monitor potential emerging risks and the risk of financial loss resulting from the physical or transitional impacts of climate change.

Each of the directors of Ninety One plc and Ninety One Limited confirms to the best of his or her knowledge and belief that:

· The condensed set of interim consolidated financial statements, which comprises the condensed consolidated statement of comprehensive income, condensed consolidated statement of financial position, condensed consolidated statement of changes in equity, condensed consolidated statement of cash flows and the related explanatory notes, has been prepared in accordance with the basis of preparation, which includes the IAS 34 Interim Financial Reporting as issued by the International Accounting Standards Board and as adopted for use in the UK (which is identical in all material respects to the version issued by the IASB) and presents fairly, in all material respects, the assets, liabilities, financial position and profits of Ninety One for the six months ended 30 September 2021.

· Under the UK Disclosure Guidance and Transparency Rules ("DTR"), the interim management report includes a fair review of the information required by:

- DTR 4.2.7R, being an indication of important events that have occurred during the first six months of the financial year and their impact on the IFRS interim condensed consolidated financial information and a description of the principal risks and uncertainties for the remaining six months of the year; and

- DTR 4.2.8R, being related party transactions that have taken place in the first six months of the financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in Ninety One's Integrated Annual Report 2021, that could have a material effect on the financial position or performance of the enterprise in the first six months of the current financial year.

· The results for the six months ended 30 September 2021 taken as a whole, present a fair, balanced and understandable assessment of Ninety One's position and prospects.

There was a change to the board of directors during the six months ended 30 September 2021. Fani Titi resigned from the board as a non-executive director on 4 August 2021 and was replaced by Khumo Shuenyane, who was appointed as a non-executive director with effect from 1 August 2021. This was approved at the Annual General Meeting on 4 September 2021. A list of current directors is maintained on the Ninety One website: www.ninetyone.com.

On behalf of the board of directors

Hendrik du Toit Kim McFarland

Chief Executive Officer Finance Director

15 November 2021 15 November 2021

We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 September 2021 which comprises the condensed consolidated statement of financial position as at 30 September 2021, the condensed consolidated statement of comprehensive income, the condensed consolidated statement of changes in equity, and condensed consolidated statement of cash flows for the six-month period then ended, and the related explanatory notes.

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 September 2021 is not prepared, in all material respects, in accordance with IAS 34 Interim Financial Reporting as adopted for use in the UK and the Disclosure Guidance and Transparency Rules ("the DTR") of the UK's Financial Conduct Authority ("the UK FCA").

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Auditing Practices Board for use in the UK. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. We read the other information contained in the half-yearly financial report and consider whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FCA.

As disclosed in note 1, the latest annual financial statements of the Group were prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 in the UK, IFRS as issued by IASB and under the DTR at that time, IFRS adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union. The next annual financial statements will be prepared in accordance with both IFRS as issued by IASB and international accounting standards as adopted for use in the UK (which are materially consistent with IFRS as issued by IASB). The Directors are responsible for preparing the condensed set of financial statements included in the half-yearly financial report in accordance with IAS 34 Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB") and IAS 34 Interim Financial Reporting as adopted for use in the UK. UK adopted IAS 34 Interim Financial Reporting is identical in all material respects to the version issued by the IASB.

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

This report is made solely to the Company in accordance with the terms of our engagement to assist the Company in meeting the requirements of the DTR of the UK FCA. Our review has been undertaken so that we might state to the Company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company for our review work, for this report, or for the conclusions we have reached.

Jatin Patel

for and on behalf of KPMG LLP

Chartered Accountants

15 Canada Square

London

E14 5GL

15 November 2021

To the shareholders of Ninety One Limited

We have reviewed the interim condensed consolidated financial statements of Ninety One Limited ("the Group") contained in the accompanying interim report set out on pages 19 to 33, which comprise the condensed consolidated statement of financial position at 30 September 2021 and the condensed consolidated statement of comprehensive income, condensed consolidated statement of changes in equity and condensed consolidated statement of cash flows for the six months then ended, selected explanatory notes, and the annexure to the condensed consolidated financial statements.

The directors are responsible for the preparation and presentation of these interim condensed consolidated financial statements in accordance with IAS 34 Interim Financial Reporting, the SAICA Financial Reporting Guides, as issued by the Accounting Practices Committee and Financial Pronouncements as issued by Financial Reporting Standards Council and the requirements of the Companies Act of South Africa, and for such internal control as the directors determine is necessary to enable the preparation of interim condensed consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Our responsibility is to express a conclusion on these interim financial statements. We conducted our review in accordance with the International Standard on Review Engagements ("ISRE") 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity ("ISRE 2410"). ISRE 2410 requires us to conclude whether anything has come to our attention that causes us to believe that the interim financial statements, are not prepared in all material respects in accordance with the applicable financial reporting framework. This standard also requires us to comply with relevant ethical requirements.

A review of financial statements in accordance with ISRE 2410 is a limited assurance engagement. We perform procedures, primarily consisting of making inquiries of management and others within the entity, as appropriate, and applying analytical procedures, and evaluate the evidence obtained.

The procedures performed in a review are substantially less than and differ in nature from those performed in an audit conducted in accordance with International Standards on Auditing. Accordingly, we do not express an audit opinion on these interim financial statements.

Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed consolidated financial statements of Ninety One Limited for the six months ended 30 September 2021 are not prepared, in all material respects, in accordance with the International Financial Reporting Standard, IAS 34 Interim Financial Reporting, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by Financial Reporting Standards Council and the requirements of the Companies Act of South Africa.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the six months ended 30 September 2021

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 30 September 2021

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the six months ended 30 September 2021

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

For the six months ended 30 September 2021

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the six months ended 30 September 2021

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 the 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 interim condensed consolidated financial statements for the six months ended 30 September 2021 ("Interim financial statements") have been prepared in accordance with:

- IAS 34 Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB") and IAS 34 Interim Financial Reporting as adopted for use in the UK. UK adopted IAS 34 Interim Financial Reporting is identical in all material respects to the version issued by the IASB;

- the accounting policies and significant judgements and estimates applied in the preparation of these Interim financial statements are consistent with those applied to the Group's consolidated financial statements for the year ended 31 March 2021;

- the South African Institute of Chartered Accountants ("SAICA") Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the Financial Reporting Standards Council and the requirements of the Companies Act of South Africa; and

- the Disclosure Guidance and Transparency Rules ("DTR") of the Financial Conduct Authority in the UK.

The Interim 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 Interim financial statements do not constitute statutory accounts as defined in Section 434 of the Companies Act 2006 in the UK. The results for the full year 31 March 2021 have been taken from the Group's Integrated Annual Report 2021. Therefore, these interim results should be read in conjunction with the Integrated Annual Report 2021 which were prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 in the UK, IFRS as issued by IASB and under DTR at that time, IFRS adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union. KPMG reported on the 31 March 2021 financial statements, and their report was unmodified and did not contain a statement under Section 498(2) or (3) of the Companies Act 2006 in the UK. The Integrated Annual Report 2021 has been filed with the Registrar of Companies in the UK. The Integrated Annual Report 2022 will be prepared in accordance with both IFRS as issued by IASB and international accounting standards as adopted for use in the UK (which are materially consistent with IFRS as issued by IASB).

The Interim financial statements are unaudited but have been reviewed by KPMG Inc and KPMG LLP, who expressed unmodified review conclusions. The auditors' reports do not necessarily report on all of the information contained in these interim results for the six months to 30 September 2021 report. Refer to KPMG Inc and KPMG LLP's review reports to obtain a full understanding of the nature of their engagement.

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

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.

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.

Going concern

The board of directors have considered the resilience of the Group, taking into account its current financial position and the principal and emerging risks facing the business including the impacts that the COVID-19 pandemic, and its associated events, has 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 continue to operate profitably for a period of at least 12 months from the date of the release of these results. The Interim 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. 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.

1 "Employee remuneration" was previously named "staff costs" in the prior period. This change is to align the description with other sections of the results announcement.

Interest income consists of interest on financial assets measured at amortised cost.

Exceptional items are defined as significant items of income or expense arising from events or transactions that are not expected to recur frequently or regularly. Such items have been separately presented to enable a better understanding of the Group's operating performance. Exceptional items are set out as below:

Gain on disposal of subsidiaries

On 30 April 2021, the Group completed the sale of Silica for a total cash consideration (net of direct expenditures) of R388.3 million (equivalent to £19.5 million). The carrying value of net identifiable assets disposed amounted to £4.6 million, resulting in a pre-tax gain on disposal of £14.9 million recognised within exceptional items in the interim condensed consolidated statement of comprehensive income for the six months ended 30 September 2021. Prior to the completion of sale, assets and liabilities of Silica were classified as held for sale.

Financial impact of group restructures

Costs incurred in separating from Investec, during H1 2021, of £2.9 million mainly relate to the demerger expenses including rebranding expenses.

The UK corporate tax rate for the six months ended 30 September 2021 was 19% (H1 2021: 19%). An increase in the UK corporate tax rate to 25% effective 1 April 2023 was enacted in the Finance Act 2021 on 10 June 2021. Deferred tax assets in the UK at 30 September 2021 were therefore calculated to the extent that they are expected to reverse after the rate increase comes into effect.

The tax charge in the period is higher (H1 2021: higher) than the standard rate of corporate tax in the UK and the differences are explained below:

The Group calculates earnings per share ("EPS") on a number of different bases in accordance with IFRS and JSE requirements.

The calculations of basic and diluted EPS are based on IAS 33 Earnings Per Share; details are shown as below:

Basic EPS is calculated by dividing the profit for the period attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period, excluding own shares held by the Ninety One Employee Benefit Trusts ("EBTs").

Diluted EPS is calculated by dividing the profit for the period attributable to ordinary shareholders 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.