Man Group PLC (LON: EMG) is set to cut its dividend but may still offer a juicy income.
The shares of Man Group (LSE: EMG) climbed 3p to 106p during early London trade this morning after investors calculated the hedge-fund specialist may offer a 6.5% income.
Man today re-confirmed that, from 2013, it would pay at least 100% of its adjusted management fee income as an ordinary dividend.
Results for 2012 issued this morning indicated pre-tax management fee income of $223m, which if sustained this year might translate into a dividend of about 6.8p per share and support a yield in excess of 6%.
Man's statement also revealed current shareholders are in line to receive an 8.3p per share payout during May. However, the results showed this payment to be 6% greater than the group's underlying profits for the entire year.
Man's figures also disclosed funds under management falling by $1bn to $57bn during 2012, with client redemptions of $20bn outweighing incoming money of $13bn.
The company admitted funds under management have declined by a further $2bn so far during 2013.
Manny Roman, Man's chief executive, said:
"2012 was another tough year for Man. Trading conditions were highly challenging as markets continued to be dominated by political uncertainties in Europe and the US and macroeconomic risks. Investor appetite remained muted and as expected there was a further decline in Man's product margin mix and revenues."
Mr Roman also said most of the group's investment strategies had enjoyed a good start to 2013 and that investor sentiment had "improved somewhat". However, he cautioned that Man had yet to see a slowdown to the rate of redemptions.
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> Maynard does not own any share mentioned in this article.
