Man Group plc (LON:EMG) has announced its results for the year ended 31 December 2020.
Key points
· Record high funds under management (FUM)1 of $123.6 billion (31 December 2019: $117.7 billion)
o Investment performance of $3.3 billion (2019: $10.1 billion)
o Net inflows of $1.8 billion (2019: net outflows $1.3 billion)
o FX translation and other movements of $0.8 billion (2019: $0.4 billion)
· Core earnings per share (EPS)1 decreased by 23% to 16.2 cents (2019: 21.0 cents)
o Core management fee EPS1 increased by 6% to 10.3 cents (2019: 9.7 cents)
o Performance fee EPS decreased by 48% to 5.9 cents (2019: 11.3 cents)
· Statutory earnings per share (EPS) decreased by 49% to 9.3 cents (2019: 18.4 cents) and statutory PBT decreased by 42% to $179 million (2019: $307 million)
· Asset weighted performance versus peers1 across our strategies of -1.0% (2019: -1.1%), with alternative strategies outperforming and valuation-focused long-only strategies underperforming
· Run rate core net management fees1 of $815 million at 31 December 2020, with net management fee margin1 of 66 basis points
· New progressive dividend policy taking into account growth in overall earnings with a recommended final dividend of 5.7 cents per share bringing the total dividend for 2020 to 10.6 cents per share (2019: 9.8 cents), an increase of 8%
· In September 2020, announced the intention to repurchase a further $100 million of shares ($36 million of shares had been repurchased at 31 December 2020)
· Strong balance sheet and liquidity position: net financial assets1 of $716 million (2019: $674 million)
1 For definitions and explanations of our alternative performance measures, please refer to pages 55 to 59. Due to the roll-off of profits from our legacy structured products business in 2019, our core and adjusted measures are now equivalent.
Summary Financials
| Page ref. | Year ended 31 Dec 2020 $ | Year ended 31 Dec 2019 $ | |
| Funds under management (end of period) 1 | 5, 6 | 123.6bn | 117.7bn |
| Core net management fee revenue1 | 18, 34 | 730m | 751m |
| Performance fees2 | 18, 34 | 199m | 345m |
| Sub-lease rental and lease surrender income | 18 | 18m | 14m |
| Core net revenues1 | 947m | 1,110m | |
| Compensation | 19, 35 | (451m) | (477m) |
| Other costs (including asset servicing) | 19, 36 | (200m) | (233m) |
| Net finance expense | 19, 36 | (12m) | (16m) |
| Core profit before tax1 | 19, 56 | 284m | 384m |
| Adjusting items3 | 19, 56 | (105m) | (79m) |
| Non-core net management fee revenue1 | 18 | – | 2m |
| Statutory profit before tax | 16, 28 | 179m | 307m |
| ¢ | ¢ | ||
| Statutory EPS1 | 38, 58 | 9.3 | 18.4 |
| Core EPS1 | 58 | 16.2 | 21.0 |
| Core management fee EPS1 | 58 | 10.3 | 9.7 |
| Dividend per share4 | 39, 21 | 10.6 | 9.8 |
1 For definitions and explanations of our alternative performance measures, please refer to page 55 to 59. Due to the roll-off of profits from our legacy structured products business in 2019, our core and adjusted measures are now equivalent.
2 Includes income or gains on investments and other instruments and third-party share of gains/losses relating to interests in consolidated funds.
3 The adjusting items in the year are shown on page 56.
4 Our dividend policy and availability of dividend resources is discussed further on page 21.
Dividend and share repurchase
The Board confirms that it will recommend a final dividend of 5.7 cents per share for the financial year to 31 December 2020, giving a total dividend of 10.6 cents per share for the year.
The Board has approved a change to Man Group’s dividend policy. The ordinary dividend policy will be progressive, taking into account the growth in the firm’s overall earnings. Man Group’s policy is to distribute available capital to shareholders over time, by way of higher dividend payments and/or share repurchases, while maintaining a prudent balance sheet, after taking into account required capital and potential strategic opportunities. Whilst the Board continues to consider dividends as the primary method of returning capital to shareholders, it will continue to execute share repurchases when advantageous.
Dates for the 2020 final dividend
| Ex-dividend date | 8 April 2021 |
| Record date | 9 April 2021 |
| Sterling conversion date | 7 May 2021 |
| Payment date | 21 May 2021 |
Conference call and presentation for investors and analysts
A conference call with management including an opportunity to ask questions will commence at 9.30am (GMT) on 2 March 2021. A copy of the
presentation and data pack will be available on the investor relations section of www.man.com from 9.25am.
The conference call can be accessed at: https://mangroup.webex.com/mangroup/onstage/g.php?MTID=e946e1605b99cf1089a8083020576aa63
Event number: 181 926 0309
Event password: pwCwm3EKu82
For those without internet access or in case of connectivity issues please use the alternative dial-in below:
Audio conference: +44 20 3478 5289
Access code: 181 926 0309
Event password: 79296335
Please note:
· We recommend connecting to the meeting 5-10 minutes prior to the start time
· To ask a question during the Q&A session you will need to access the meeting via the link above
Luke Ellis, Chief Executive Officer of Man Group, said:
“Last year was an exceptionally difficult time for much of the world, with COVID-19 fundamentally changing our day-to-day lives and how businesses operated. I am proud of how the Man Group team pulled together and am delighted to deliver a strong set of financial results in a challenging environment, which demonstrate both growth and resilience. We have increased our management fee profits and our dividend to shareholders, and grown client assets to end the year at a new record high for funds under management.
“Our ability to deal calmly with the stresses of the year and to grow our business is a testament to the strength and resilience of our people and the quality of our technology platform. It is our combination of talent and technology that delivers superior returns for our clients and growth for our shareholders. Confidence in our strategy also drives our move to a new progressive dividend policy.”
