Half year trading update and quarterly announcement of funds under management
Brooks Macdonald Group plc today announces a trading update for its half year ended 31 December 2012 together with an update on its funds under management.
Trading for the half year was in line with the Board's expectations, with revenues and profits ahead of the same period last year with significant progress made in all areas of the business on our growth strategies.
In November, we announced the acquisition of Spearpoint, a Jersey and Guernsey based provider of discretionary fund management with stockbroking and retirement planning capabilities, which completed on the 19 November. A successful placing to raise £21.5 million was completed at the time to fund the majority of the initial consideration. Acquisition costs of £1.016 million were incurred and these one off costs will be charged to the profit and loss account for the period.
On completion Spearpoint had discretionary assets under management of £686 million, including funds totalling £85 million. In addition it had advisory assets of £357 million. Spearpoint is a good synergistic fit with the Group’s existing growth strategy, adding important access to an expanding international pensions market.
Since the acquisition, integration has successfully commenced and the rebranding of the business has been completed with the launch of Brooks Macdonald International (which is divided into Asset Management, Employee Benefits and Retirement Services).
Funds under Management
As at 31 December 2012 discretionary funds under management totalled GBP £4.62 billion (30 September 2012: £3.751 billion).
This represents an increase of 23.2% over the quarter and 5% net of the impact of the acquisition of Spearpoint. As a comparison the APCIMS balanced index grew by 1.6% over the quarter.
Over the first six months of the current financial year discretionary funds grew by £1.1 billion, or 31% and net of the acquisition of Spearpoint by £414 million, representing 11.8% over the first six months. This compares to the APCIMs balanced index that grew by 4.1% over the period.
Included in the above total is Brooks Macdonald Funds, which now incorporates the former Spearpoint funds; it had funds under management of £323 million at the half year end or £244 million net of the Spearpoint Funds (30 June 2012: £148 million). The successful reconstruction of the Spearpoint funds was completed just prior to Christmas and whilst this led to some modest redemptions (around £7 million) it has led to the launch of two new income funds.
As at 31 December 2012 advisory funds under management (formerly managed by Spearpoint) totalled GBP £373 million.
Property assets under administration
The Group’s property management business Braemar Estates had property assets under administration of £885 million at the half year end (30 June 2012: £865 million), an increase of £20 million against a backdrop of asset revaluations downwards of 5%.
Third party assets under administration
The Group launched its new investment management administration service in April 2012, having successfully become an Application Service Provider ('ASP'). Following this launch third party assets under administration are now in excess of £100 million.
Notice of Results
The Group intends issuing its half year results on Wednesday, 13 March 2013
Chris Macdonald, Chief Executive of Brooks Macdonald, commented:
“The half year has been a successful period of growth across the Group, culminating in our acquisition of Spearpoint in November. We are excited about the enhanced capabilities this gives to our Group offering and the opportunities going forward.”