Key points
- Funds under management (FUM)1 up 5% to $114.4 billion (31 December 2018: $108.5 billion)
o Positive investment movement of $6.8 billion (H1 2018: negative $1.7 billion)
o Net outflows of $1.1 billion (H1 2018: net inflows $8.3 billion)
o Positive FX translation and other movements of $0.2 billion (H1 2018: negative $2.0 billion)
- Adjusted profit before tax (PBT)1 up 3% to $157 million (H1 2018: $153 million)
o Adjusted management fee PBT1 of $83 million (H1 2018: $120 million) incorporating non-operating impacts of $21 million from the FX hedge and the adoption of IFRS 16, as well as no associate income following the sale of our stake in Nephila in 2018
o Adjusted performance fee PBT1 of $74 million (H1 2018: $33 million)
- Adjusted earnings per share (EPS)1 up 6% to 8.6 cents (H1 2018: 8.1 cents) reflecting:
o Higher performance fees and seed investment gains
o Positive impact of a lower share count following share buybacks
o Decline in the net management fee margin from 71 to 68 basis points reflecting strong growth in lower margin strategies
- Statutory PBT of $110 million (H1 2018: $90 million); Statutory EPS of 5.8 cents (H1 2018: 4.6 cents) with the increase reflecting the adjusted EPS growth drivers above and lower adjusting items
- Asset weighted underperformance versus peers1 of 1.1% for the six months to 30 June 2019 (outperformance of 1.0% for the year ended 31 December 2018)
· Interim dividend of 4.7 cents per share (H1 2018: 6.4 cents per share)
- Corporate reorganisation successfully completed in May providing more flexibility in financing the business; $150 million Tier 2 notes will be redeemed in full on 16 September 2019
Luke Ellis, Chief Executive Officer of Man Group, said:
“Absolute performance was strong in the first half of 2019, particularly in our quant alternative strategies, which drove a $5.9 billion increase in FUM and growth in profits. Relative performance and flows were more mixed with outperformance and inflows into our quant alternative strategies and underperformance and outflows from our valuation biased strategies, with clients continuing to reduce their equity exposure coming into the third quarter.
We enter the second half of 2019 with good performance fee earning potential with 90% of Man AHL strategies at high water mark and the diversified nature of our business means that we remain well positioned to navigate the current economic environment. We continue to focus on delivering superior risk adjusted performance for our clients and, in doing so, creating long-term value for our shareholders.”
1 For definitions and explanations of our alternative performance measures, please refer to pages 34-39
Summary financials
| Pageref. | Six months ended 30 June 2019 $m | Year ended 31 December 2018$m | Six months ended 30 June 2018 $m | |
| Net management fee revenue1,2 | 35 | 382 | 791 | 401 |
| Performance fees3 | 38 | 142 | 122 | 85 |
| Net revenues | 524 | 913 | 486 | |
| Compensation4 | 25 | (243) | (436) | (227) |
| Other costs4 | 25 | (115) | (221) | (104) |
| Net finance expense4 | 26 | (9) | (5) | (2) |
| Adjusted profit before tax1 | 36 | 157 | 251 | 153 |
| Adjusting items5 | 36 | (47) | 27 | (63) |
| Statutory profit before tax | 17 | 110 | 278 | 90 |
| Statutory diluted earnings per share (EPS) | 26 | 5.8c | 17.0c | 4.6c |
| Adjusted EPS1,6 | 37 | 8.6c | 13.5c | 8.1c |
| Adjusted management fee EPS1,6 | 37 | 4.7c | 11.8c | 6.4c |
| Dividend per share | 3.87p | 8.94p | 4.88p |
1 For definitions and explanations of our alternative performance measures, please refer to pages 34-39
2 Includes gross management and other fees, distribution costs, sub-lease rental income (six months ended 30 June 2019) and share of post-tax profit from associates (year ended 31 December 2018 and six months ended 30 June 2018)
3 Includes income or gains/(losses) on investments and other financial instruments and third-party share of losses relating to interests in consolidated funds
4 Excludes adjusting items. Other costs include asset servicing costs
5 Adjusting items primarily relate to amortisation of acquired intangible assets and movements in contingent consideration. Refer to the alternative performance measures section (page 36) for further detail
6 The reconciliation of diluted statutory EPS to adjusted EPS is included in the alternative performance measures (page 37)
Key Performance Indicators7, 8
| Six months ended 30 June 2019 | Year ended 31 December 2018 | Six months ended 30 June 2018 | |
| Asset weighted (underperformance)/outperformance versus peers | (1.1)% | 1.0% | 0.3% |
| Net (outflows)/inflows9 | (2.0)% | 9.9% | 15.2% |
| Adjusted core profit before tax | $155m | $237m | $145m |
| Adjusted management fee EPS growth | -27% | 9.3% | 28.5% |
7 For definitions and explanations of our alternative performance measures, please refer to pages 34-39
8 For definitions and explanations of key performance indicators refer to the 2018 annual report
9 Six month figures are annualised
Results presentation, audio webcast and dial in details
There will be a presentation by the management team at 9:30 am (UK time) on 31 July 2019 at Riverbank House, 2 Swan Lane, London EC4R 3AD. A copy of the presentation will be made available on the Group’s website at www.man.com. There will also be a live audio webcast available on https://www.man.com/GB/results which will also be available on demand from later in the day. The dial-in and replay telephone numbers are as follows:
Live Conference Call Dial in Numbers:
International: +44 (0) 20 3003 2666
UK Toll-Free Number: 0808 109 0700
US Toll-Free Number: + 1 866 966 5335
30 Day Replay Dial in Numbers:
International: +44 (0) 20 8196 1480
UK Toll Free Number: 0800 633 8453
US Toll Free Number: +1 866 583 1039
Access Code: 3392907#
This interim report can be found on Man Group’s website, www.man.com.
