Investors pump £8.1bn into Schroders' funds in 2021

Investors pump £8.1bn into Schroders' funds in 2021

Some £8.1bn was invested on a net basis into Schroders’ funds in the year to December 31.

The company announced the rise in its full year results in a statement to the stock exchange this morning (March 3).

This compared with net redemptions of £3.1bn in 2020, and brings the company’s assets under management in mutual funds to £116bn.

Schroders said the demand for higher margin equity products offset industry fee pressures, which led to net operating revenue rising 17 per cent to £2.4bn.

Net income rose 18 per cent to £2.7bn, and the group will pay a final dividend of 85p per share, up from 79p for the previous year.

Pre-tax profits rose 25 per cent to £764mn.

Peter Harrison, group chief executive, Schroders, said 2021 was an important year for the group.

“These results benefitted from the strategic decisions we took several years ago, improving both the resilience of our business and its long-term growth potential.”

Delivering excellent investment performance is the company’s primary focus, he added, saying it was “pleasing” that 79 per cent of assets outperformed on a three-year basis.

Harrison added: “Importantly, the areas where we have invested for growth have delivered strongly. Performance across our partnerships, wealth, private assets and our sustainability franchise accelerated and enabled us to better serve a wider group of clients…We continue to invest for the future.” 

In 2021, Schroders acquired River & Mercantile’s UK solutions business, adding £43bn of assets under management to the group’s existing solutions business.

It also purchased Dutch specialist property manager Cairn Real Estate, adding €1.3bn (£1.08bn) of assets under management and enhancing the company’s private assets business, Schroders capital.

Finally, Schroders has agreed to acquire a 75 per cent stake in renewable infrastructure manager Greencoat Capital. The transaction is expected to complete in the second quarter of this year, and Schroders says it foresees “significant growth opportunities” in the US and Europe.

Last month, the Schroders Investment Solutions business, which operates model portfolio and fund of fund operations for financial advisers, said it is targeting £10bn in assets under management by 2025.

The business unit presently has assets under management of £4.5bn, across a range of active-only, passive-only and blended portfolios, along with sustainable investment ranges. 

Alex Funk, its chief investment officer, said: “We hope we are differentiated by the scale and breadth of the service we can provide, we have got people who are economists and can do the macro, we have people who work on the asset allocation and of course we have fund pickers."