River and Mercantile Group PLC Trading Statement (3680V)

TIDMRIV

RNS Number : 3680V

River and Mercantile Group PLC

30 January 2017

30 January 2017

River and Mercantile Group PLC

Trading Update

River and Mercantile Group PLC (R&M), the advisory and investment solutions business today provides a trading update comprising Assets under Management (AUM), Notional under Management (NUM) and performance fees for the three and six months ended 31 December 2016.

Highlights for the three months ended 31 December 2016:

   --     Fee earning AUM/NUM increased by 3% to GBP28.7bn. 

-- Net inflows were GBP0.7bn in the quarter, with net sales of GBP0.6bn and positive rebalancing flows in Derivative Solutions of GBP0.1bn.

   --     Investment performance added GBP0.2bn. 
   --     Performance fees in the quarter ended 31 December 2016 are estimated to be GBP2.4m. 

Highlights for the six months ended 31 December 2016:

   --     Fee earning AUM/NUM increased by 13%. 

-- Net inflows were GBP2.0bn in the six months, with net sales of GBP1.5bn and positive rebalancing flows in Derivative Solutions of GBP0.5bn.

   --     Positive investment performance in all divisions added GBP1.2bn. 
   --     Performance fees for the six months are estimated to be GBP4.7m. 

Mike Faulkner, CEO of River and Mercantile, said:

In the quarter, we continued to grow assets and in-force revenue from both positive net flows and investment performance. Our investment performance track record continues to be strong across all products. Our client orientated solutions and low attrition rates have resulted in positive net flows in each of the last eleven quarters since the IPO. We remain well positioned to continue this growth.

Assets Under Management (AUM) and Notional Under Management (NUM)

AUM/NUM for the three months ended 31 December 2016.

 
                                 Assets Under Management (AUM) and Notional Under Management (NUM) 
 
                                                                   Equity Solutions 
                                                          ---------------------------------- 
                          Fiduciary        Derivative 
 GBP'm                    Management        Solutions      Wholesale   Institutional   Total   Total AUM/NUM 
                       ---------------  ----------------  ----------  --------------  ------  -------------- 
                            (AUM)             (NUM)          (AUM)         (AUM)       (AUM) 
 Opening Fee Earning 
  AUM/NUM                       10,166            15,078       1,321           1,326   2,647          27,891 
 Sales                             133             1,293         187              17     204           1,630 
 Redemptions                     (144)             (781)        (88)            (19)   (107)         (1,032) 
                                                                                              -------------- 
                                  (11)               511          99             (2)      97             598 
 Net Rebalance                       -               103           -               -       -             103 
 
 Net Flow                         (11)               614          99             (2)      97             701 
 
 Investment 
  Performance                     (34)                 -          63             127     190             156 
 Fee Earning AUM/NUM            10,121            15,693       1,483           1,451   2,934          28,748 
 
 Mandates in 
  Transition (31 
  December 2016)                    27                 -           -               -       -              27 
 
 Redemptions in                      -                 -           -               -       -               - 
 Transition (31 
 December 2016) 
 Mandated AUM/NUM               10,148            15,693       1,483           1,451   2,934          28,775 
                       ===============  ================  ==========  ==============  ======  ============== 
 
 Increase/(Decrease) 
  in Fee Earning 
  Assets                        (0.4%)              4.1%       12.3%            9.4%   10.8%            3.1% 
                       ---------------  ----------------  ----------  --------------  ------  -------------- 
 Increase/(Decrease) 
  in Mandated Assets              0.3%              7.0%       12.3%            9.4%   10.8%            4.9% 
                       ---------------  ----------------  ----------  --------------  ------  -------------- 
 

Fiduciary Management closing fee earning AUM includes GBP89m relating to the River and Mercantile Dynamic Asset Allocation Fund.

AUM/NUM for the six months ended 31 December 2016.

 
                                   Assets Under Management (AUM) and Notional Under Management (NUM) 
 
                                                                   Equity Solutions 
                                                          ---------------------------------- 
                             Fiduciary      Derivative 
 GBP'm                       Management      Solutions     Wholesale   Institutional   Total   Total AUM/NUM 
                           -------------  --------------  ----------  --------------  ------  -------------- 
                               (AUM)           (NUM)         (AUM)         (AUM)       (AUM) 
 Opening Fee Earning 
  AUM/NUM                          9,287          13,903       1,171           1,187   2,358          25,548 
 Sales                               440           2,059         278             134     412           2,911 
 Redemptions                       (232)           (817)       (197)           (177)   (374)         (1,423) 
                                                                                              -------------- 
                                     208           1,242          81            (43)      38           1,488 
 Net Rebalance                         -             548           -               -       -             548 
 
 Net Flow                            208           1,790          81            (43)      38           2,036 
 
 Investment Performance              626               -         231             307     538           1,164 
 Fee Earning AUM/NUM              10,121          15,693       1,483           1,451   2,934          28,748 
 
 Mandates in Transition 
  (30 June 2016)                       -             170           -               -       -             170 
 Transitions/Adjustments              27           (170)           -               -       -           (143) 
                                                                                              -------------- 
 Mandates in Transition 
  (31 December 2016)                  27               -           -               -       -              27 
 
 Redemptions in 
  Transition (30 June 
  2016)                             (49)           (590)           -               -       -           (639) 
 Transitions                          49             590           -               -       -             639 
                                                                                              -------------- 
 Redemptions in                        -               -           -               -       -               - 
 Transition (31 December 
 2016) 
                           ------------- 
 Mandated AUM/NUM                 10,148          15,693       1,483           1,451   2,934          28,775 
                           =============  ==============  ==========  ==============  ======  ============== 
 
 Increase/(Decrease) in 
  Fee Earning Assets                9.0%           12.9%       26.6%           22.2%   24.4%           12.5% 
                           -------------  --------------  ----------  --------------  ------  -------------- 
 Increase/(Decrease) in 
  Mandated Assets                   9.9%           16.4%       26.6%           22.2%   24.4%           14.7% 
                           -------------  --------------  ----------  --------------  ------  -------------- 
 

Notes to editors:

River and Mercantile Group PLC (R&M) is an advisory and investment solutions business with a broad range of services, from consulting and advisory, to fully delegated fiduciary management and fund management.

R&M is focussed on creating investment solutions for institutional pension schemes, insurance and financial intermediaries and operates through four divisions: Investment Solutions encompassing both advisory and fiduciary management, Derivative Solutions providing structured equity and LDI, Equity Solutions providing UK and global equity strategies and Multi Asset Solutions, providing dynamic asset allocation and other multi asset based solutions.

The Group has GBP29bn under management, including GBP16bn of derivatives, and advises on more than GBP25bn of assets.

For further information please contact:

River & Mercantile Group PLC [phone]

Kevin Hayes, Chief Financial Officer

Chris Rutt, Deputy Chief Financial Officer and Investor Relations

Forward-looking statements

This announcement contains forward-looking statements with respect to the financial conditions, results and business of the Group. By their nature, forward looking statements involve risk and uncertainty because they relate to events, and depend on circumstances that will occur in the future. River and Mercantile Group's actual results may differ materially from the results expressed or implied in these forward looking statements. Nothing in this announcement should be construed as a profit forecast.

Notes:

Assets Under Management (AUM) represents the assets over which we act either as a discretionary investment manager on a partial or fully delegated basis in accordance with an investment management agreement.

Notional Under Management (NUM) represents the aggregate notional of derivative contracts and is the basis on which management fees are charged.

Net rebalance in the Derivative Solutions division represents the net change in billing notional values of Derivatives from existing client mandates and can increase or decrease based on changes in the underlying hedging strategies.

Fee Earning AUM/NUM represents amounts on which management fees and performance fees are charged.

Mandates in Transition represent the AUM/NUM of mandates which have been awarded by clients at the period-end date and will transition into fee earning assets. The timing, and ultimate amount transitioned is determined by the client. We report an estimated AUM/NUM for those mandates where there is a high likelihood of the amount being transitioned within the next three months.

Redemptions in transition are redemptions which have been notified by the client at the period-end date, but where the AUM/NUM is included in fee earning assets at period end. The redemptions will be included in a future period.

This information is provided by RNS

The company news service from the London Stock Exchange

END

TSTBSGDBUSDBGRR

(END) Dow Jones Newswires

January 30, 2017 02:00 ET (07:00 GMT)