City of London Investment Group PLC Interim Management Statement / Trading Update (2493L)

TIDMCLIG

RNS Number : 2493L

City of London Investment Group PLC

18 April 2018

City of London Investment Group PLC

18 April 2018

CITY OF LONDON INVESTMENT GROUP PLC

("City of London", "the Group" or "the Company")

INTERIM MANAGEMENT STATEMENT

QUARTERLY FUNDS UNDER MANAGEMENT ("FUM") UPDATE

City of London (LSE: CLIG), a leading specialist asset management group focused on emerging markets and closed-end funds, provides a third quarter trading update for the period 1 January 2018 to 31 March 2018. Total funds under management (FuM) at 31 March 2018 were US$5.4 billion (GBP3.9 billion). This compares with US$5.3 billion (GBP3.9 billion) at the Company's half-year on 31 December 2017. A breakdown by strategy follows:

 
                      FuM ($mn)                    Strategy Index 
 
                                   % inc                            % inc 
             Dec-17       Mar-18       /     Net                        / 
                      (estimate)     dec   Flows                      dec 
 
 EM           4,660        4,634     -1%    (38)   MSCI EM             1% 
 DEV            337          433     28%     102   MSCI ACWI          -1% 
                                                   ACWI/Barclays 
 GTAA           139          150      8%      13    Global Agg         0% 
 Frontier       193          202      5%       -   MSCI Frontier       5% 
              5,329        5,419              77 
----------  -------  -----------  ------  ------  ---------------  ------ 
 

Positive relative investment performance was recorded in the Developed strategy, whilst the EM, GTAA and Frontier strategies underperformed. Sharply wider discount movements, driven by increased volatility, drove relative performance, whilst the Developed strategy benefitted from strong NAV performance. Net flows were positive in aggregate over the period, particularly in the Developed strategy which continues to benefit from a focused marketing strategy and excellent long term investment results.

With regards to business development, the Group continues to maintain an active pipeline across all of its major CEF offerings with an increased interest in the diversification CEF strategies. In total the active pipeline is in excess of US$400 million, these include opportunities that are spread across Emerging and Developed Markets, Global Tactical Asset Allocation, Tactical Income, and Frontier CEF strategies.

Operations

The Group's income accrues at a weighted average rate of approximately 80 basis points, net of commissions and custody charges. "Fixed" costs are cGBP1.0 million per month, and accordingly the current run-rate for operating profit, before profit-share at 30%, and an estimated EIP charge of 2%, is approximately GBP1.5 million per month based upon current FuM and a US$/GBP exchange rate of US$1.42 to GBP1.

Further to the City of London Investment Management press release of 12th April (see link below), the Group received notice of an appeal on 16th April. The City of London Investment Group would estimate that at the present time the effect on the Group P&L will not be material.

A link to that press release follows:

https://www.prnewswire.com/news-releases/city-of-london-issues-open-letter-to-stockholders-of-the-china-fund-300629156.html

Dividends

The interim dividend of 9 pence per share was paid on 16 March 2018. The Board will announce the final dividend on Tuesday 17 July 2018 in its pre-close trading update.

-ends-

For further information, please visit www.citlon.co.uk or contact:

 
 Barry Olliff (CEO)            Tel: [phone] 
  City of London Investment 
  Group PLC 
 Martin Green                  Tel: [phone] 
  Zeus Capital Limited 
  Financial Adviser & Broker 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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April 18, 2018 02:00 ET (06:00 GMT)