Ashmore optimistic despite AUM slide

Added 6th September 2016

Emerging markets specialist fund manager Ashmore has reported a $6.3bn (£4.7bn, €5.6bn) fall in assets under management and an 18% decline in net revenues.

Ashmore optimistic despite AUM slide

AUM of $52.6bn was recorded at its year end compared with $58.9bn at 30 June 2015. Revenues fell to £232.5m, while adjusted EBITDA was £130.9m.

Ashmore said its investment performance had shown significant improvement over one year and outperformance was maintained over three and five years.

The firm said 69% of its AUM outperformed benchmarks over one year, 63% over three years and 73% over five years.

Despite diluted earnings per share being reduced by 7% to 18.1p, the company still felt able to confirm a final dividend per share of 12.1p, meaning a total dividend per share for the year of 16.65p will be paid.

Emerging market comeback

Chief executive Mark Coombs said: "Ashmore's strategy and business model are designed to deal with the fluctuations of market cycles, and while the past few years have presented challenges to emerging markets, these results for the financial year demonstrate that the group has maintained its high profitability and continued to generate cash.

"In weaker markets, Ashmore's consistent investment processes acquire risk and these actions usually provide strong outperformance for clients as markets recover.”

Coombs made the case for Ashmore seeing better times ahead by drawing comparison between the prospects for emerging markets relative to developed, as he sees it.

"The rally in emerging markets asset prices and improving investor sentiment in 2016 is underpinned by solid economic fundamentals such as accelerating GDP growth, low and stable inflation, and responsible and effective fiscal and monetary policies,” he said.

“In contrast, the ongoing challenges in the developed world, such as high indebtedness, political risk and reluctance to reform, are seemingly not priced in, and therefore provide a clear incentive for investors to shift or increase allocations to emerging markets where there is a diversified range of investment opportunities offering highly attractive absolute and relative returns."

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Alex Sebastian

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Alex joined Portfolio Adviser in April 2014 and has been a financial journalist since 2008. He has previously held editorial positions at the Financial Times Group and Euromoney Institutional Investor. Alex is NCTJ qualified and has a degree in economics from the University of Sussex.

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