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Abrdn’s interim boss ruled out a return to dealmaking as the struggling UK asset manager swung to a profit in the first half following cost cuts and the sale of its private equity business.
The London-listed group on Tuesday reported a first-half profit of £187mn compared with a loss of £169mn a year earlier.
Abrdn has embarked on a significant cost-cutting programme as the group battles a squeeze on fees and a period of sustained outflows. For the first half, outflows slowed to £1.6bn, from £4.4bn in the same period last year.
Abrdn said its return to profitability was partly boosted by the sale of its £7.4bn European-headquartered private equity business, which it completed earlier this year.
Jason Windsor, interim chief executive, said: “While market conditions remain challenging, we are firmly on track to realise at least £150mn of annualised cost savings by the end of 2025.”
Windsor, a former mergers and acquisitions banker, said on Tuesday that he had no plans to make further acquisitions, following his predecessor’s purchase of Interactive Investor for £1.5bn in 2021. Windsor added that he was “very comfortable with the group we have” and that his focus was “about execution” of its existing strategy.
Shares in Abrdn were up almost 4 per cent in early trading.
Abrdn has had a turbulent four years in which it has twice been ejected from the FTSE 100 and suffered from a much-ridiculed rebranding, when its Standard Life Aberdeen brand was ditched for Abrdn.
Windsor, who was parachuted in as interim chief executive in May when the company announced Stephen Bird’s departure, is poised to take on the role on a permanent basis, although the company gave no update on Tuesday.
“While Jason Windsor has not been confirmed yet as CEO, his statement certainly reads like one of a CEO-in-waiting,” said Rae Maile, analyst at Panmure Liberum.
Mandeep Jagpal, analyst at RBC Capital Markets, described the results as “solid”, noting that operating profit and net flows beat expectations.
Abrdn’s Interactive Investor, one of the UK’s largest direct-to-consumer investment sites, reported net inflows of £3.1bn over the period — up from £1.8bn the previous year.
Bird oversaw Abrdn’s acquisition of Interactive Investor as part of a broader plan to diversify the business, the bulk of which is in its asset management division.
Although Abrdn’s fixed income funds were among the strategies to report net inflows, the company’s equity products continued to suffer from customers withdrawing their money. Abrdn said that “improving the investment performance” of its equity funds “remains a priority”.
Windsor said management had “seen some pretty good signs” that momentum had returned to its asset management business in terms of customer inflows — pointing to larger institutional clients.
The company’s total assets under administration increased by 2 per cent to £505.9bn.
