Shares of Aberdeen Asset Management (LSE: ADN) lifted 2% to 406p in early trade after the emerging markets specialist announced outflows of its funds have slowed in the two months to 31 August. Net outflows reduced to £1.7bn against £8.8bn in the previous quarter.
Despite the accounts still showing a net outflow, this was weighted towards lower margin products, with more inflows being won into higher margin funds. The effect on revenue, therefore, was more positive than in recent quarters.
The integration of Scottish Widows Investment Partnership continues to progress according to expectations. Total assets under management, including the SWIP business, increased 3% to £331bn.
Market volatility has renewed in September after a period of calm, and Aberdeen said that its increased scale since the acquisition of SWIP “provides a solid foundation to weather what are likely to remain volatile markets”.
“Our equity capabilities are recovering, both in terms of performance and flows following a tough 2013. It’s also encouraging that our marketing focus on non-equity products is gaining traction, particularly in terms of property and emerging market debt,” the FTSE 100 member added.
Prior to today, analysts were expecting earnings per share to increase 11% to 31p and rally to 35p the year after. The former projection supports a near-term P/E of 13.
Of course, whether those ratings, today’s results and the wider prospects for the asset management industry combine to make the shares a ‘buy’ is something only you can decide.
