By Iain Withers
LONDON (Reuters) – Abrdn reported deeper than expected outflows of client funds in the third quarter, sending its shares down 8% and underlining the challenges facing new CEO Jason Windsor as he tries to revive the British fund manager’s fortunes.
The 3.1 billion pounds ($4 billion) of net outflows were half the 6.7 billion pounds that took flight in the same period last year, but analysts said they missed forecasts.
Windsor told reporters the figures showed the need for improvement, with withdrawals in its investments and adviser businesses masking a better picture at its retail arm, interactive investor.
“Our overall performance this quarter is not where it needs to be and underlines the need to move quickly to deliver the priorities I’ve set out,” Windsor said, adding that the company’s previously announced cost-cutting plans were on track.
Windsor said he had no update on abrdn’s broader strategy after speculation from some analysts the company could be broken up. “I’m comfortable with the group as we have it,” he said.
The company also said assets under management edged up by about 800 million pounds over the three-month period to 506.7 billion pounds at the end of September, reflecting the impact of improving markets even as the company experienced outflows.
Windsor warned the UK’s newly-elected Labour government not to be too heavy-handed in “strong-arming” money from investors into the domestic economy when it announces its first budget this month.
“The UK needs to make itself an attractive place for investment… You can be damn sure investment will follow that,” he said.
Windsor added that potential volatility in markets resulting from the looming U.S. election was largely factored into investors’ strategies.
“We’re a long term investing business … We want to look through that and have a business that operates well for clients through any number of cycles, economic or political,” he said.
Mid-sized active fund managers such as abrdn have come under pressure in recent years from growing competition from cheaper index-tracking products and inflationary pressure on costs.
Abrdn has been particularly hard hit, suffering more than 10 billion pounds of outflows over each of the past two years.
($1 = 0.7737 pounds)
(Reporting by Iain Withers; Editing by Sinead Cruise, Tommy Reggiori Wilkes and David Goodman)
