REG - Liontrust Asset Mgmt - Trading Statement

Liontrust Asset ManagementAnnouncement

12/04/2022 07:01

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RNS Number : 0231I  Liontrust Asset Management PLC  12 April 2022

LEI: 549300XVXU6S7PLCL855

For immediate release

12 April 2022

Stock Exchange Announcement

LIONTRUST ASSET MANAGEMENT PLC

Trading Update

 

Liontrust Asset Management Plc ("Liontrust", or the "Company"), the specialist
independent fund management group, today issues its trading update for the
period 1 January to 31 March 2022.

 

Highlights

 

·    Net outflows of £0.4 billion in the three months ended 31 March 2022
and net inflows of £2.5 billion for the financial year ended 31 March
2022(1).

 

·    Assets under management and advice ("AuMA") were £33.5 billion as at
31 March 2022, an increase of 8.5% over the financial year.

 

·    Majedie Asset Management Limited ("Majedie") acquisition completed on
1 April 2022 adding £5.2 billion(2) to AuMA, taking Liontrust's pro forma
AuMA to £38.7 billion.

 

·    The Majedie investment team has been renamed the Liontrust Global
Fundamental team

 

·    Liontrust had the second highest net retail sales in the UK in 2021,
according to the Pridham Report

 

·    AuMA as at 7 April 2022 were £38.5 billion.

 

(1) Includes outflows of £329 million related to the termination of the
investment management agreement for the Verbatim Portfolio Growth Funds
("Verbatim Funds") on 21 March 2022.

(2) As at close of business on 31 March 2022.

 

Commenting, John Ions, Chief Executive, said:

 

"We have repeatedly talked about the importance of process over the past few
years, both for our investment teams and for running Liontrust. This has never
been more relevant given the nervousness over the horrific war in Ukraine and
its potential direction. The sanctions imposed on and by Russia have
exacerbated the impact of inflationary pressures and central banks tightening
monetary policies on market volatility and uncertainty.

 

Over the long term - more than 20 years in the case of our Economic Advantage
and Sustainable Investment teams - the consistent application of the rigorous
Liontrust investment processes to our funds has delivered strong performance
for investors. Staying true to processes helps to keep fund managers focused
and retain clarity of thought during more challenging periods such as now.

 

Our teams' investment processes have been performing as we would expect given
the market environment of the past few months, and the fund managers remain
confident about the long-term prospects for the companies in their portfolios.
During times of such market sell-offs, the fund managers are presented with
opportunities to add to their stocks at cheaper valuations and buy into
companies they have liked but that previously did not offer attractive entry
points.

 

While we had net outflows of £0.4 billion in the three months to 31 March
2022, over the whole financial year, Liontrust generated net inflows of £2.5
billion and has delivered positive sales at the start of the new financial
year. The largest negative impact on net flows in the last quarter was the
loss of the £329 million investment management mandate for the Verbatim
Funds.

 

The net outflows of the past quarter do not alter our belief in and focus on
the long-term strategy of the business. Liontrust has continued to diversify
and expand our investment capability and the business, and ensured we deliver
for and engage with our investors.

 

This success is highlighted by comparing our sales to the rest of the asset
management industry in the Pridham Report. Over the course of 2021, Liontrust
had the second highest net retail sales in the UK and the fifth highest gross
retail sales.

 

The breadth and quality of our investment capability is shown by the fact that
seven of our funds have been shortlisted for Investment Week's Fund Manager of
the Year Awards in June while Liontrust has once again been nominated for
Global Group of the Year. The seven fund nominations are spread across five of
our investment teams.

 

The acquisition of Majedie Asset Management, which completed on 1 April 2022,
has continued our diversification and expansion, both through distribution to
institutional investors and investment capability, as well as adding £5.2
billion to our AuMA. Majedie also brings excellent client service, which is
reflected in the strength of their relationships. The investment managers, who
have been rebranded as the Liontrust Global Fundamental team, are highly
regarded, which is demonstrated by the quality of their institutional mandates
and the management of Edinburgh Investment Trust since March 2020.

 

The breadth of Liontrust's existing distribution has been demonstrated by the
fact that nearly 1,000 advisers have so far registered to attend our World
Market Review Roadshow around the UK in the spring. The Liontrust Multi-Asset
team will present their latest investment views and updates on their funds and
portfolios on the Roadshow.

 

Liontrust is investing in digital marketing to enhance further the service we
provide and the engagement we achieve with clients and investors, including
through the launch of our new website at the end of March featuring distinct
customer journeys and personalisation. Our website and wider digital marketing
strategy are designed to give clients and investors the information and
content they want and in the way they want to consume it while also enhancing
their online experiences with Liontrust.

 

I have strong conviction in our investment teams, their processes and their
ability to continue to deliver for investors over the long term. I also have
great confidence in Liontrust and our business processes to maintain long-term
growth and deliver for employees, shareholders and other stakeholders. The
acquisition of Majedie and our continued investment in the business to enable
us to engage meaningfully with investors reinforces this belief."

 

Assets under management and advice

 

On 31 March 2022, our AuMA stood at £33,548 million and were broken down by
type and investment process as follows:

 

 Process                        Total   Institutional(3)  UK Retail  Multi-Asset  Offshore
                                (£m)    (£m)              (£m)       (£m)         (£m)
 Sustainable Investment         13,227  136               12,187     -            904
 Economic Advantage             9,035   455               8,201      -            379
 Multi-Asset                    6,660   -                 -          6,660        -
 Global Equity                  2,868   167               2,701      -            -
 Cashflow Solution              1,094   650               364        -            80
 Global Fixed Income            664     -                 300        -            364
 Total - 31 March 2022          33,548  1,408             23,753     6,660        1,727

 Global Fundamental             5,150   3,567             898        -            685
 Total inc. Global Fundamental  38,698  4,975             24,651     6,660        2,412

 

(3) Investment Trust AuMA included in Institutional

 

AuMA as at 7 April 2022 were £38,461 million.

 

Flows

 

The net outflows over the three months to 31 March 2022 were £432 million(4)
(2021: net inflows £958 million). A reconciliation of fund flows and AuMA
over the three months to 31 March 2022 is as follows:

 

                                    Total    Institutional  UK Retail  Multi-Asset  Offshore
                                    (£m)     (£m)           (£m)       (£m)         (£m)

 Opening AuMA - 1 January 2022      37,239   1,535          26,304     7,375        2,025

 Net flows                          (432)    (17)           84         (398)        (101)

 Market and Investment performance  (3,259)  (110)          (2,635)    (317)        (197)

 Closing AuMA - 31 March 2022       33,548   1,408          23,753     6,660        1,727

 

The net inflows over the financial year to 31 March 2022 were £2,488
million(4) (2021: £3,498 million). A reconciliation of fund flows and AuMA
over the financial year to 31 March 2022 is as follows:

 

                                    Total   Institutional  UK Retail  Multi-Asset  Offshore
                                    (£m)    (£m)           (£m)       (£m)         (£m)

 Opening AuMA - 1 April 2021        30,929  1,488          20,627     7,139        1,675

 Net flows                          2,488   (105)          3,025      (541)        109

 Market and Investment performance  131     25             101        62           (57)

 Closing AuMA - 31 March 2022       33,548  1,408          23,753     6,660        1,727

 

(4) Includes outflows off £329 million related to the termination of the
investment management agreement for the Verbatim Funds on 21 March 2022.

 

UK Retail Fund Performance (Quartile ranking)

 

                                          Quartile ranking - Since Launch/Manager Appointed  Quartile ranking - 5 year  Quartile ranking - 3 year  Quartile ranking - 1 year  Launch Date/ Manager Appointed
 Economic Advantage funds
 Liontrust UK Growth Fund                 1                                                  1                          2                          1                          25/03/2009
 Liontrust Special Situations Fund        1                                                  1                          1                          3                          10/11/2005
 Liontrust UK Smaller Companies Fund      1                                                  1                          1                          1                          08/01/1998
 Liontrust UK Micro Cap Fund              1                                                  1                          1                          2                          09/03/2016
 Sustainable Future funds
 Liontrust Monthly Income Bond Fund       2                                                  1                          1                          2                          12/07/2010
 Liontrust SF Managed Growth Fund         2                                                  1                          1                          3                          19/02/2001
 Liontrust SF Corporate Bond Fund         1                                                  2                          2                          4                          20/08/2012
 Liontrust SF Cautious Managed Fund       1                                                  1                          2                          4                          23/07/2014
 Liontrust SF Defensive Managed Fund      1                                                  1                          1                          4                          23/07/2014
 Liontrust SF European Growth Fund        2                                                  2                          1                          4                          19/02/2001
 Liontrust SF Global Growth Fund          3                                                  1                          1                          3                          19/02/2001
 Liontrust SF Managed Fund                1                                                  1                          1                          4                          19/02/2001
 Liontrust UK Ethical Fund                2                                                  1                          1                          4                          01/12/2000
 Liontrust SF UK Growth Fund              2                                                  1                          2                          4                          19/02/2001
 Global Equity funds(5)
 Liontrust Balanced Fund                  1                                                  1                          1                          1                          31/12/1998
 Liontrust China Fund                     4                                                  3                          3                          3                          31/12/2004
 Liontrust Emerging Market Fund           2                                                  4                          4                          3                          30/09/2008
 Liontrust Global Smaller Companies Fund  1                                                  1                          3                          4                          01/07/2016
 Liontrust Global Alpha Fund              1                                                  1                          1                          1                          31/12/2001
 Liontrust Global Dividend Fund           2                                                  1                          1                          4                          20/12/2012
 Liontrust Global Innovation Fund         1                                                  1                          2                          4                          31/12/2001
 Liontrust Global Technology Fund         3                                                  2                          2                          1                          15/12/2015
 Liontrust Income Fund                    1                                                  1                          2                          1                          31/12/2002
 Liontrust India Fund                     4                                                  4                          2                          1                          29/12/2006
 Liontrust Japan Equity Fund              2                                                  3                          1                          3                          22/06/2015
 Liontrust Latin America Fund             1                                                  2                          3                          3                          03/12/2007
 Liontrust US Opportunities Fund          1                                                  1                          2                          3                          31/12/2002
 Cashflow Solution funds
 Liontrust European Growth Fund           1                                                  1                          1                          1                          15/11/2006
 Global Fixed Income funds
 Liontrust Strategic Bond Fund            3                                                  -                          3                          4                          08/05/2018

 

Source: Financial Express to 31 March 2022 as at 5 April 2022, bid-bid, total
return, net of fees, based on primary share classes. Past performance is not a
guide to future performance, investments can result in total loss of capital.
The above funds are all UK authorised unit trusts or UK authorised ICVCs
(primary share class).

 

(5 )Liontrust Russia Fund is not included as it is currently suspended and in
an IA sector that is not rankable (e.g. Specialist) so it would not be a fair
comparison to make.

 

Key UK & Irish Fund Performance for Global Fundamental team funds
(Quartile ranking)

 

                                         Quartile ranking - Since Launch/Manager Appointed  Quartile ranking - 5 year  Quartile ranking - 3 year  Quartile ranking - 1 year  Launch Date/ Manager Appointed
 Global Fundamental team UK Funds(6)
 LF Liontrust UK Equity Fund             1                                                  4                          4                          3                          27/03/2003
 LF Liontrust UK Focus Fund              1                                                  4                          4                          4                          29/09/2003
 LF Liontrust UK Equity Income Fund      2                                                  3                          4                          3                          19/12/2011
 LF Liontrust Global Equity Fund         2                                                  2                          2                          4                          30/06/2014
 LF Liontrust Global Focus Fund          2                                                  2                          3                          4                          30/06/2014
 Global Fundamental team Irish Funds(6)
 Liontrust GF US Equity Fund             3                                                  2                          2                          4                          26/06/2014
 Liontrust GF UK Equity Fund             4                                                  4                          4                          3                          03/03/2014
 Liontrust GF International Equity Fund  2                                                  -                          -                          4                          17/12/2019

 

Source: Financial Express to 31 March 2022 as at 05 April 2022, bid-bid, total
return, net of fees, based on primary share classes. Past performance is not a
guide to future performance, investments can result in total loss of capital.
The above funds are all UK authorised ICVCs or Irish OEICs (primary share
class).

 

(6) The onshore and offshore Liontrust GF Tortoise funds are not included as
they are not in IA sectors.

 

Alternative Performance Measures

 

Liontrust reports Alternative Performance Measures ("APMs"), including
Adjusted Profit Before Tax, Adjusted Operating Profit, Adjusted Operating
Margin and Adjusted EPS, alongside our statutory measures, to assist the users
of our accounts in assessing the underlying performance of our business
operations.  The APMs seek to exclude the effects of non-recurring,
non-operating (financing/capital/non-cash) and exceptional items from the
statutory measures. However, a number of these costs, despite being non-cash
are ongoing expenses and will be related to the normal operating basis of the
business. The most significant of these is share incentivisation costs. The
Directors have also reviewed depreciation expense and IFRS16 related property
expenses and concluded that these expenses and share incentivisation costs
should not be removed in the calculation of APMs with effect from the
financial year ended 31 March 2022 and in future financial years.

 

The Directors expect that these amendments will be absorbed within the
existing market forecasts for Administration Expenses thereby meaning minimal
impact to the relevant forecast APMs for the financial year ended 31 March
2022 and in future financial years. The Directors believe this revised
approach to accounting for APMs is appropriate as the Company continues to
grow in scale, reflecting the approaches taken by similar and larger UK-listed
asset management peers.

 

Full year results

 

Liontrust expects that it will be announcing its full year results for the
financial year ended 31 March 2022 on Wednesday, 22 June 2022.

 

For further information please contact:

 

Liontrust Asset Management Plc (Tel: 020 7412 1700, Website: liontrust.co.uk)

John Ions: Chief Executive

Vinay Abrol: Chief Financial Officer & Chief Operating Officer

Simon Hildrey: Chief Marketing Officer

David Boyle: Head of Corporate Development

 

Singer Capital Markets (Tel: 020 7496 3000)

Corporate Broking: Tom Salvesen

Corporate Finance: Justin McKeegan

 

Panmure Gordon (Tel: 020 7886 2500)

Corporate Broking: Charles Leigh-Pemberton

Corporate Finance: Dominic Morley

 

Forward Looking Statements

This announcement contains certain forward-looking statements with respect to
the financial condition, results of operations and businesses and plans of
Liontrust. These statements and forecasts involve risk and uncertainty because
they relate to events and depend upon circumstances that have not yet
occurred. There are a number of factors that could cause actual results or
developments to differ materially from those expressed or implied by these
forward-looking statements and forecasts. As a result, the Liontrust's actual
future financial condition, results of operations and business and plans may
differ materially from the plans, goals and expectations expressed or implied
by these forward-looking statements.  Liontrust undertakes no obligation
publicly to update or revise forward-looking statements, except as may be
required by applicable law and regulation (including the Listing Rules of the
Financial Conduct Authority).  Nothing in this announcement should be
construed as a profit forecast or be relied upon as a guide to future
performance.

 

Other information

The release, publication, transmission or distribution of this announcement
in, into or from jurisdictions other than the United Kingdom may be restricted
by law and therefore persons in such jurisdictions into which this
announcement is released, published, transmitted or distributed should inform
themselves about and observe such restrictions. Any failure to comply with the
restrictions may constitute a violation of the securities laws of any such
jurisdiction.

 

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