Aberdeen hit by £8.8bn outflow as emerging markets suffer

Aberdeen Asset Management has been hit by an £8.8bn net outflow in the six months to the end of March during a “demanding” period for the firm’s main markets in Asia and emerging markets.

Excluding the addition of assets from Scottish Widows Investment Partnership (Swip), which was bought during the period, Aberdeen’s assets fell from £200.4bn to £190.4bn as the outflows combined with negative currency movement.

The outflows meant that the firm’s revenues and profits slipped slightly from the same period in 2013, with underlying profits before tax down 3 per cent to £217m.

Aberdeen’s chief executive Martin Gilbert acknowledged the past six months had been “demanding” for the firm but said it had begun to “win new mandates” in emerging markets in March and April.

He said there had been a “pick up in sentiment” towards emerging markets in that period but he warned that he “anticipate[s] some uncertainty may remain”.

The outflows from Aberdeen’s emerging markets business had been exacerbated by some of its key strategies underperforming their benchmarks in the past year, but Mr Gilbert said March and April had also seen an “uptick in investment performance”.

Mr Gilbert said the integration with Swip was on track, with the completion of Swip’s infrastructure business finally completing the acquisition last week.

He said the acquisition is expected to enhance Aberdeen’s earnings in the first year from completion as the extra scale and the cost synergies involved will drive profits.