JupiterApr 25 2023

Jupiter sees £900mn in outflows in first quarter

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Jupiter sees £900mn in outflows in first quarter
Luke MacGregor/Bloomberg

Investors pulled £900mn from Jupiter’s funds in the first three months of the year after clients showed weak demand for UK and European equities.

In a trading update today (April 25), the asset manager said £1bn was withdrawn from its retail, wholesale and investment trust channel, which was partially offset by £100mn in positive flows from institutional clients driven mainly by mandates into global equity strategies managed by NZS Capital.

Jupiter has not seen net inflows to its products since 2017.

The group said there were positive net inflows into its global equities strategies, and although outflows from fixed income products slowed, market uncertainty remains.

It added that its pipeline of “late stage opportunities remains strong”.

Analysts at Peel Hunt said there is “little surprise” in Jupiter’s comment that investors remained cautious. 

“The statement reports that the pipeline remains strong, but these flows are lumpy and difficult to predict on timing.

“Although there were some encouraging signs in the recent results, this quarter is a reminder that flows are likely to remain challenging.”

Jupiter’s assets under management grew in the three months to March 31, rising by £600mn to £50.8bn.

This was driven by positive market movements of £1.5bn, which was offset by the outflows.

Jupiter’s flows briefly turned positive in the second half of last year, driven by its institutional channel, however pre-tax profit dropped 68 per cent to £58mn.

At the time, chief executive Matthew Beesley said the past year had “clearly” been difficult.

“Although gross inflows remained strong, we again saw net outflows…although this is not where we want to be, we are encouraged by a strong turnaround in the second half.”

Beesley was promoted to CEO in September last year after the departure of Andrew Formica, who had been the target of criticism by a former board member who said the fund house had “lost its way” and its share price drop was “self inflicted”.

The asset manager has recently undergone a restructure of its funds, a third of which were closed, merged or reconfigured, and around 15 per cent of the workforce made redundant.

Market commentators have said the outflows make it vulnerable to a takeover, despite Formica saying earlier last year that Jupiter does not see itself being part of the current wave of consolidation in the sector.