Ashmore sees AUM fall

Ashmore sees AUM fall

Specialist emerging markets asset manager Ashmore has reported assets under management of US$52.6bn for the year to the end of June, down from US$58.9bn on the previous year.

Investment performance improved with 69 per cent of AUM outperforming benchmarks over one year and 63 per cent outperforming over three years.

Net revenues at the asset manager declined 18 per cent across the year to £232.5m, with 22 per cent lower average AUM level.

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Mark Coombs, chief executive of Ashmore Group, 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.

“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.

“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.”

Peter Lenardos, analyst at RBC Europe Limited, said the results were a less bullish outlook statement than envisioned coupled with a premium valuation and strong share performance which was likely to cause disappointment.

Mr Lenardos said: “We retain our view that at the current level, especially given Ashmore’s valuation, share price performance and an outlook statement that appears to indicate that net flows are not accelerating, the shares are over-valued and may register disappointment.”