Man Investments has started the current financial on a positive note after profits and assets under management grew last year, its parent company Man Group revealed today in its full year earnings.
Man Group said pre-tax profits for the year ended 31 March 2005 rose to USD 784 million from USD 715 million in the previous year, at the higher end of analysts’ expectations. That growth also helped Man Group bolster its cash position, and net cash rose to USD 903 million from USD 602 million in the previous year.
Profits from the brokerage business, Man Financial, rose 21% to USD 145 million before tax, goodwill and amortisation, while net management fee income from Man Investments rose 35% to USD 614 million. Assets under management increased by 12% over the year to USD 43 billion, bolstered by fund sales of USD 12.1 billion, including institutional sales of USD 5.8 billion.
Asset management performance fees, however, fell to USD 119 million from USD 236 million as tough trading conditions in the first half of the financial year hurt directional strategies such as managed futures and equity long short funds.
The group also issued an upbeat statement about the coming year. Chief executive Stanley Fink said, “Since the year-end we have made continued progress in sales, with our latest Global launch raising USD 438 million of investor assets. With Asset Management and Brokerage both well placed for further growth, the Board is confident of the Group's prospects for the coming year.”
Fink pointed to strong sales of Man Investments’ latest global fund offering, Man AP Enhanced Series 2 Ltd, which closed in April having raised a respectable USD 438 million in investor money, and a good level of activity in the forward pipeline. He said the year had started well for both the brokerage and asset management businesses.
Man Investments record sales last year were spread across 44 new products, with private investors accounting for 52% of sales and institutions the remaining 48%. Private investments currently accounts for about 59% of Man Investments’ assets under management.
Institutional sales were predominantly Europe, while Western Europe and the Asia Pacific continued to account for the majority of private investor sales. In Asia, Japan emerged as an active region for many asset management classes, particularly among private investors and that demand is expected to continue in 2005/6.
There was also a slight change in the sales mix during the year. Institutional sales rose 57%, with RMF seeing the strongest demand. In Continental Europe, however, there was some slow-down in asset raising from private investors, in particular Switzerland, across the alternative investments industry. This appears to reflect the fact that private investors in this region are typically already well allocated to alternatives.
The increase in funds under management in the year from Man Investments’ four global launches was USD 2.5 billion, down from USD 3.3 billion in the prior year, partly because of lacklustre short-term performance and partly because of continued strong sales of our joint venture or 'white label' business which were up 14% at USD 2.4 billion. Particularly noteworthy were two large joint ventures in Japan which raised a total of USD 1.1 billion.
Open-ended sales accounted for USD 1.4 billion, down from USD 2.4 billion in the prior year.
Notes to Editors
About Man Investments
Man Investments, the asset management division of Man Group plc, is a global leader in the fast growing alternative investments industry. It provides innovative products and tailor-made solutions to private and institutional investors. Through its core investment managers - AHL, Glenwood, Man Global Strategies and RMF – Man Investments has succeeded in developing leadership in hedge funds and has interests in other asset classes. In its core hedge fund asset class, Man offers funds of hedge funds, structured and style products. Its track record stretches back more than two decades and defines the standard for excellence in an industry whose central goal is to provide diversification away from traditional equity and bond investments. Man has a powerful global presence with central operations in Pfäffikon (Switzerland) and London and key centres in Chicago, Montevideo, Hong Kong, Sydney, Tokyo and Dubai and has an extensive network of distribution partners. Further information on Man Investments can be found on the internet at www.maninvestments.com.
About Man Group plc
Man Group plc is a leading global provider of alternative investment products and solutions as well as one of the world's largest futures brokers. The Group employs over 2,800 people in 15 countries, with key centres in London, Pfäffikon (Switzerland), Chicago, New York, Paris, Singapore and Sydney. Man Group plc is listed on the London Stock Exchange (EMG.L) and is a constituent of the FTSE 100 index. Further information on Man Group can be found at www.mangroupplc.com
