Standard Life was hit by net outflows of £3.7bn during the first half of 2017, driven by money being pulled from its mammoth Global Absolute Return Strategies fund, while the figures revealed its has nearly doubled its advisers in two years.
The £23bn fund saw net outflows of £5.6bn, which Standard Life attributed to weaker short-term investment performance during 2016.
Total redemptions across Standard Life increased to £24.4bn, leading to net outflows of £3.7bn.
Overall Standard Life’s assets under management increased by 1 per cent to £361.9bn.
Nonetheless the company’s operating profit before tax increased 6 per cent to £362m as Standard Life prepares for its merger with Aberdeen Asset Management – expected to take effect from Monday (14 July).
Keith Skeoch, chief executive of Standard Life, said: “We continue to see the benefits of targeted investments to further our diversification agenda, the success of our newer investment solutions and the ongoing focus on operational efficiency.
“This has allowed us to grow assets, profits, cash flows and returns to shareholders. “With the proposed merger with Aberdeen on track for completion on 14 August we are ready to accelerate the pace of strategic delivery as we open the next chapter of our transformation to a diversified world-class investment company.”
Standard Life’s adviser platforms saw record retail net inflows of £3.4bn, with wrap inflows up 48 per cent to £3.1bn and Elevate inflows up to £600m.
Total assets under administration on its platforms increased by 11 per cent to £49.2bn.
The company said these flows were driven by growth in the pension market, particularly defined benefit transfer values and pension freedoms.
It cited the increasing number of consumers moving into its drawdown propositions as an example of this, with total assets invested increasing by 11 per cent to £18.2bn.
Standard Life’s operating expenses increased by £15m – or 3 per cent – as £29m was added to its cost base through the acquisition of Elevate and its continuing expansion of advice arm 1825.
It said that if Elevate and 1825 were excluded, absolute expenses for the company would have fallen.
The latest figures show that 1825 how has 73 financial planners with more than 8,600 clients and assets of £3.4bn. This is from a standing start with the acquisition of Pearson Jones in May 2015, which brought in assets of £1.1bn and 39 advisers and paraplanners.
damian.fantato@ft.com
