Ninety One assets drop 7% despite net inflows

Ninety One’s assets under management dropped 7% for the year ended 31 March, despite recording net inflows of £6bn.

The firm, which demerged from its parent Investec in March, said its AUM stood at £103.4bn at the end of the year, down from £111.4bn the year before.

Net inflows remained stable at £6bn compared with £6.1bn the year before, but noted short-term investment performance was negatively affected by the extreme market correction in March 2020. The firm reported a £14bn loss due to currency and market movements for the year.

Net revenue was higher at £609.9m compared with £556.9m the previous year and profit before tax increased 11% to £198.5m. Profit after tax increased to £156m, from £139.8m.

Ninety One paid its final dividend to cover the 2020 financial year, amounting to £183.9m, prior to the demerger. The board of directors has recommended no further ordinary or special dividends for the 2020 financial year.

Looking ahead, Ninety One said it expects to target an ordinary dividend payout ratio of at least 50% of its profit after tax. “We will consider paying a special dividend, which will comprise surplus retained earnings not needed for regulatory or specific investment needs, as well as a reasonable buffer as agreed with our board of directors,” it added.

Fixed income and equities dominate flows

Net inflows were made up of £2.54bn into fixed income, £2.44bn into equities, £750m into multi-asset, £108m into alternatives and £217m into its South African fund platform.

Institutional investors accounted for £3.67bn of net inflows while adviser-channelled inflows were £2.38bn.

UK clients accounted for £2.34bn of overall flows, followed by £1.84bn from Africa, £1.55bn from Europe, £256m from the Americas and £66m from Asia Pacific.

CEO hails a ‘momentous’ but challenging year

In March, the asset manager demerged from parent Investec and changed its name from Investec Asset Management to Ninety One, to reflect the year it was founded, and it listed on the London and Johannesburg stock exchanges.

The company noted all Ninety One staff are now shareholders with employees collectively owning more than 21% of the firm’s equity.

Ninety One chief executive Hendrik du Toit (pictured) described last year as “momentous” with the successful demerger, but one that was challenged by the Covid-19 pandemic.

“These developments took place in the face of extreme market volatility and weakened economic prospects, which we expect to endure for some time,” he said. “The resilience of our people and technology enabled us to provide all our clients with uninterrupted service and intensified engagement.”

The results are for a period that does not include the departure of Alastair Mundy who in April took an extended leave of absence from Ninety One due to health reasons.

> See also: Ninety One takes double hit as Square Mile strips six industry funds of ratings  

 

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