27 March 2008
It is anticipated that Group profit before tax* for the year ending 31 March 2008 will be ahead of consensus market expectations as net performance fee income will be up strongly over last year and above expectations, reflecting good performance across a range of our products in the year, and from AHL in particular. Net management fee income will be up by over 15% on the prior year, driven by the growth in funds under management. Diluted earnings per share* are expected to be up by over 50%.
Sales for the year are estimated to be $15.8 billion, split 49% private investor product and 51% institutional product. Redemptions for the year were $10.6 billion, of which private investor were $5.1 billion. Funds under management have risen and are currently estimated to be around $75 billion up from $61.7 billion at 31 March 2007 ($71.7 billion at 31 December 2007). The split of funds under management is private investor $43.6 billion (31 March 2007: $36.6 billion) and institutional $31.4 billion (31 March 2007: $25.1 billion).
Sales for the three months to 31 March 2008 are estimated to be $3.5 billion, of which guaranteed products accounted for $0.9 billion; open-ended private investor sales for $1.0 billion; and institutional sales for $1.6 billion. Redemptions for the three months to 31 March 2008 were $2.6 billion, of which private investor were $1.2 billion. In the three months to 31 March 2008, performance is estimated to have added $0.8 billion and currency translation impacts and other adjustments a further $0.6 billion.
Our most recent fund launch in the Far East , which closed in March, raised $1 billion and has been included in FUM of $75 billion for the year to 31 March 2008. This launch starts trading 1 April and therefore is not included in the above sales figures.
The Group continues to be in a very strong capital position and will have significant net cash at 31 March 2008.
Man Group will announce its preliminary results for the financial year on 29 May 2008.
Peter Clarke, CEO of Man Group, today said:
"This is a very strong set of results, achieved through a period of significant market turmoil. Funds under management have risen to around $75 billion. Strong sales momentum has been maintained with sales of $15.8 billion in the year, reflecting the attraction of our diversified product range, established track record, and the broad geography of our investors. Good performance has added $5.3 billion to investor assets during a period when global markets were exceptionally volatile. Redemption rates have fallen back towards recent low levels in the final quarter.
Pre tax profits have risen substantially for the year, and will be ahead of current market expectations. In addition, our shareholders have seen substantial cash returns during the year, both from our enhanced distribution policy and the December 2007 capital return. Our balance sheet remains very strong and we have significant cash reserves.
Our financial strength, strategic focus and strong performance mean that Man is extremely well placed to see continued strong growth."
Note: The consensus market expectations of Group profit before tax* referred to earlier in this announcement are based on forecasts provided to Man Group by thirteen UK equity analysts since the Group's interim results in November 2007. The consensus, calculated as the average, is $1,824 million.