Brooks Macdonald Asset Management  

Brooks Macdonald flows up but funds fall 3.9%

Brooks Macdonald flows up but funds fall 3.9%
Photographer: Jason Alden/Bloomberg

Brooks Macdonald’s net flows grew by £179mn between January and March, but poor investment performance meant funds under management fell 3.9 per cent.

In a quarterly trading update published today (April 14), the wealth management firm posted a 1 per cent quarterly increase in net flows.

But “weaker global markets”, exacerbated by the economic consequences of the war in Ukraine, shaved £850mn from Brooks Macdonald’s funds under management.

With net flows factored in, funds fell overall by £600mn, from £17.3bn at the end of December to £16.7bn at the end of March.

The firm’s investments underperformed by 4.9 per cent over the quarter, more than the MSCI Pimfa Private Investor Balanced Index which fell by a lesser 2.7 per cent.

Andrew Shepherd, Brooks Macdonald’s chief executive, said despite the volatile market backdrop driven by the war in Ukraine, “this has been a solid quarter for Brooks Macdonald”.

Shepherd put this down to continuing positive net flows, which he said provided further evidence of the success of the firm's strategy. 

“As ever, this is primarily down to the commitment and high quality delivery of our people, who give me great confidence in the group's continued success,” said the wealth manager’s boss.

Funds under management are still up 1.2 per cent compared to the group’s total at the beginning the financial year in June 2021, when they sat at £16.5bn.

Annualised net flows were up 4.1 per cent at the end of March, which Brooks Macdonald said was in line with guidance given in its interim results.

Overall, the firm said its pipeline “remains healthy”, but it did caveat that current market conditions are expected to affect near-term conversion times.

In the previous quarter, between October and December, net flows climbed by 3.1 per cent, three times the growth the firm saw this quarter. But similar to the most recent quarter, investment performance fell short of the index.

The company's international business returned to positive net flows at the end of last year, growing from £2.5bn to £2.6bn, after organic net new business fell by £14mn the previous quarter. This quarter, net flows grew by just £3mn.