REG - Man Group plc - Half year results for the period ended 30 Jun 2024
26/07/2024 07:00
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RNS Number : 9216X Man Group plc 26 July 2024
Press Release
26 July 2024
Half year results for the six months ended 30 June 2024
Key points
Strong investment performance across our diversified range of investment
strategies and solutions
o Positive investment performance of $11.1 billion, or +2.1% relative to
peers( KPI )
o Net inflows of $0.9 billion, 1.8% ahead of the industry( KPI )
o AUM(1) of $178.2 billion as at 30 June 2024 (31 December 2023: $167.5
billion)
Core management fee EPS growth( KPI ) of 26%, highlighting the strength of our
business model
o Run-rate net management fees of $1,128 million as at 30 June 2024 (31
December 2023: $1,087 million)
o Core performance fees of $170 million from both alternative and long-only
strategies
o Statutory EPS (diluted) of 13.8¢ and core EPS (diluted) of 17.1¢( KPI )
Robust balance sheet and disciplined capital policy to support our long-term
growth ambitions
o Net tangible assets of $779 million as at 30 June 2024 (31 December 2023:
$782 million)
o Seed investments of $549 million (31 December 2023: $595 million)
o Recommended interim dividend of 5.6¢, in line with previous guidance
o $11 million of the share buyback announced in February 2024 was
outstanding at 24 July
Good progress against our multi-year strategic priorities, including:
o Delivered strong growth in liquid credit strategies. US direct lending
proceeding in line with expectations
o Launched new initiatives focused on distributing high-quality investment
content via the wealth channel
o Completed structural reorganisation around our core competencies of
Systematic, Discretionary and Solutions
Robyn Grew, Chief Executive Officer of Man Group, said:
"We have started the year strongly, delivering for our clients in a market
environment driven by the evolution of forward interest rates, expectations of
technological disruption, and the outcome of elections globally. We generated
investment performance of $11.1 billion, with a broad range of our strategies
contributing. For context, our flagship multi-strategy alternative offering
gained 13.3%. We were also pleased to record net inflows of $0.9 billion
during another challenging period for asset raising in the industry. We ended
June with AUM of $178.2 billion, and delivered core profit before tax of $257
million in the first half.
"At the beginning of 2024 we outlined our multi-year strategic priorities. We
aim to further diversify our investment capabilities, notably in quant equity,
credit and solutions; to extend our client reach, with a particular emphasis
on North America, wealth and insurance channels; and to leverage our existing
strengths and scale. These are not overnight wins, but we are pleased with the
progress we have made already and will continue to execute on these
objectives.
"While the institutional nature of our business can result in some variability
in short term net flows, our business is in great shape going into the second
half of the year. We offer a diversified range of investment strategies and
solutions, underpinned by our high-quality talent and cutting-edge technology,
that are highly relevant to our clients as they try to grapple with volatile
markets. I am confident that we will continue to deliver for them."
'Core' measures are alternative performance measures. For a detailed
description of our alternative performance measures, including non-core items,
please refer to pages 27 to 35.
KPI Details of key performance indicators can be found in the 2023 Annual
Report.
1. Assets under management. A full definition can be found in the 2023
Annual Report.
Summary financials
$ millions, unless otherwise stated Six months to Six months to
30 Jun 2024 30 Jun 2023
AUM, end of period $178.2bn $151.7bn
Core net management fees 551 460
Core performance fees 170 32
Core net revenue(1) 761 513
Core profit before tax 257 137
Statutory profit after tax 164 83
¢
Core management fee EPS (diluted) 11.0 8.7
Statutory EPS (diluted) 13.8 6.8
Interim dividend per share 5.6 5.6
Financial key performance indicators( KPI )
Relative investment performance 2.1% 0.6%
Relative net flows 1.8% 2.5%
Core EPS (diluted) 17.1¢ 8.9¢
Core management fee EPS growth(2) 26% (4)%
Dividend
Man Group's ordinary dividend policy is progressive, taking into account the
growth in the firm's overall earnings. The firm first takes into account
required capital and potential strategic opportunities, and maintains a
prudent balance sheet. Our policy is to then distribute available capital to
shareholders over time by way of higher dividend payments and/or share
repurchases. While the Board considers dividends as the primary method of
returning capital to shareholders, it will continue to execute share
repurchases when advantageous.
In line with this policy, the Board has declared an interim dividend of 5.6
cents per share (30 June 2023: 5.6 cents). The interim dividend is in line
with the guidance communicated that we intend to keep our interim dividend
flat until such time as the ratio of interim to final dividend gets closer to
1:2, in line with the broader UK market. We will fix and announce the US
dollar to sterling dividend currency conversion rate on 6 September 2024, in
advance of payment.
Dates for the 2024 interim dividend
Ex-dividend date 8 August 2024
Record date 9 August 2024
Final election date for Dividend Reinvestment Plan (DRIP)(3) 30 August 2024
Sterling conversion date 6 September 2024
Payment date 20 September 2024
Forward-looking statements and other important information
This document contains forward-looking statements with respect to the
financial condition, results, and business of Man Group plc. By their nature,
forward-looking statements involve risk and uncertainty and there may be
subsequent variations to estimates. Man Group plc's actual future results may
differ materially from the results expressed or implied in these
forward-looking statements.
The content of the websites referred to in this announcement is not
incorporated into and does not form part of this announcement. Nothing in this
announcement should be construed as or is intended to be a solicitation for or
an offer to provide investment advisory services or to invest in any
investment products mentioned herein.
KPI Details of key performance indicators can be found in the 2023 Annual
Report.
1. Includes core gains/(losses) on investments and core rental income.
2. Growth measured against comparative prior period.
3. A DRIP is provided by Equiniti Financial Services Limited. The DRIP
enables shareholders to elect to have their cash dividend payments used to
purchase shares. More information can be found at
www.shareview.co.uk/info/drip (http://www.shareview.co.uk/info/drip) .
Conference call and presentation for investors and analysts
A conference call with management including an opportunity to ask questions
will commence at 08.00am (London) on 26 July 2024. A copy of the presentation
will be available on the Investor Relations section of www.man.com
(http://www.man.com) from 07.55am. Please note: We recommend connecting to the
meeting 5-10 minutes prior to the start time. To ask a question during the
Q&A session you will need to access the meeting via the link below.
The conference call can be accessed at:
https://mangroup.webex.com/mangroup/j.php?MTID=ma25eee711016b09c1c53fdb678a14fc8
(https://mangroup.webex.com/mangroup/j.php?MTID=ma25eee711016b09c1c53fdb678a14fc8)
Webinar number:
2369 975 9177
Webinar password:
ManH12024Results (62641202 when dialling from a phone or video system)
Join by phone:
+44 20 3478 5289 United Kingdom toll
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Access code: 236 997 59177
Enquiries
Karan Shirgaokar
Head of Investor Relations
+44 20 7144 1434
investor.relations@man.com (mailto:investor.relations@man.com)
Georgiana Brunner
Head of Communications
+44 20 7144 1000
media@man.com (mailto:media@man.com)
Neil Doyle
FTI Consulting
+44 77 7197 8220
man@ (mailto:mangroupUK@finsbury.com) fticonsulting.com
About Man Group
Man Group is a global alternative investment management firm focused on
pursuing outperformance for sophisticated clients via our Systematic,
Discretionary and Solutions offerings. Powered by talent and advanced
technology, our single and multi-manager investment strategies are underpinned
by deep research and span public and private markets, across all major asset
classes, with a significant focus on alternatives. Man Group takes a
partnership approach to working with clients, establishing deep connections
and creating tailored solutions to meet their investment goals and those of
the millions of retirees and savers they represent.
Headquartered in London, we manage $178.2(1) billion and operate across
multiple offices globally. Man Group plc is listed on the London Stock
Exchange under the ticker EMG.LN and is a constituent of the FTSE 250 Index.
Further information can be found at www.man.com (http://www.man.com) .
1. As at 30 June 2024. All investment management and advisory services
are offered through Man Group affiliated regulated investment managers.
Assets under management
AUM movements for the six months ended 30 June 2024
$bn AUM at Net flows Investment performance Other(1) AUM at
31 Dec 2023
30 Jun 2024
Absolute return 47.7 (1.6) 2.5 0.6 49.2
Total return 42.5 1.7 1.4 (0.6) 45.0
Multi-manager solutions 19.4 (2.7) 0.2 (0.8) 16.1
Alternative 109.6 (2.6) 4.1 (0.8) 110.3
Systematic long-only 36.5 (0.4) 5.2 (0.1) 41.2
Discretionary long-only 21.4 3.9 1.8 (0.4) 26.7
Long-only 57.9 3.5 7.0 (0.5) 67.9
Total 167.5 0.9 11.1 (1.3) 178.2
AUM movements for the three months ended 30 June 2024
$bn AUM at Net flows Investment performance Other(1) AUM at
31 Mar 2024
30 Jun 2024
Absolute return 50.3 (0.3) (0.5) (0.3) 49.2
Total return 43.3 2.0 0.1 (0.4) 45.0
Multi-manager solutions 17.7 (1.1) 0.0 (0.5) 16.1
Alternative 111.3 0.6 (0.4) (1.2) 110.3
Systematic long-only 39.7 0.0 1.5 0.0 41.2
Discretionary long-only 24.7 1.9 0.2 (0.1) 26.7
Long-only 64.4 1.9 1.7 (0.1) 67.9
Total 175.7 2.5 1.3 (1.3) 178.2
1. Includes the impact of foreign currency exchange rate fluctuations,
performance-linked leverage movements, distributions and realisations
(proceeds from maturities or disposals) across real estate and US direct
lending strategies, and capital returned to investors from CLO strategies.
AUM by product category
$bn 30 Jun 2023 30 Sep 2023 31 Dec 2023 31 Mar 2024 30 Jun 2024
Absolute return 47.3 48.0 47.7 50.3 49.2
Institutional solutions(1) 14.7 15.5 16.2 17.4 17.1
Traditional trend-following 10.4 10.1 9.5 9.6 9.5
Multi-strategy quant 6.0 5.8 6.0 6.5 6.3
Alternative trend-following 5.3 5.4 5.4 5.3 4.8
Discretionary equity 4.7 4.5 4.4 4.6 4.5
Other(2) 6.2 6.7 6.2 6.9 7.0
Total return 29.4 39.6 42.5 43.3 45.0
Multi-asset risk parity 13.2 12.4 14.2 15.2 16.2
Alternative risk premia 8.9 9.2 9.9 10.3 11.4
US direct lending - 10.7 10.8 10.7 10.3
CLOs and other 3.5 3.7 4.0 3.8 3.8
Real estate 3.2 3.1 3.1 3.0 3.0
Emerging markets fixed income 0.6 0.5 0.5 0.3 0.3
Multi-manager solutions 20.3 20.3 19.4 17.7 16.1
Infrastructure and direct access 12.7 12.8 12.8 12.0 11.5
Segregated 7.0 6.9 6.1 5.3 4.3
Diversified and thematic FoHF 0.6 0.6 0.5 0.4 0.3
Systematic long-only 35.7 34.0 36.5 39.7 41.2
Global equity 19.2 18.4 20.2 22.5 23.7
Emerging markets equity 7.7 7.3 8.0 8.4 8.9
International equity 7.5 7.1 7.0 7.8 7.2
US equity 1.3 1.2 1.3 1.0 1.4
Discretionary long-only 19.0 19.3 21.4 24.7 26.7
Credit and convertibles 6.6 6.6 8.1 9.6 10.7
Japan equity 4.8 5.3 5.3 6.3 6.3
UK equity 3.9 3.8 4.1 4.4 5.0
Europe ex-UK equity 1.3 1.2 1.3 1.9 1.8
Emerging markets fixed income 1.0 0.9 1.0 0.9 0.9
Other(3) 1.4 1.5 1.6 1.6 2.0
Total 151.7 161.2 167.5 175.7 178.2
1. Includes AHL Institutional Solutions, which invests into a range of
AHL strategies including AHL Alpha, AHL Dimension and AHL Evolution, as well
as other absolute return strategies.
2. Includes other AHL, Numeric and Discretionary credit absolute
return strategies.
3. Includes other equity and multi-asset strategies.
Investment performance
Return (net of fees) Annualised return (net of fees)
3 months to 6 months to 3 years to 5 years to Inception to 30 Jun 2024
30 Jun 2024
30 Jun 2024
30 Jun 2024
30 Jun 2024
Absolute return
AHL Alpha 1 0.7% 7.6% 5.7% 6.9% 10.2%
AHL Dimension 2 0.5% 7.5% 7.2% 4.2% 5.0%
AHL Evolution 3 -6.1% 1.7% 6.2% 6.9% 11.6%
AHL Diversified 4 -0.7% 11.3% 4.7% 7.1% 10.4%
GLG Alpha Select Alternative 5 1.5% 2.8% 8.3% 6.8% 5.0%
GLG Event Driven Alternative 6 -0.5% 0.5% 3.1% - 5.9%
GLG Global Credit Multi Strategy 7 2.6%* 6.0%* 4.2%* 5.4%* 10.8%*
Man Strategies 1783 8 3.1% 13.3% 10.3% - 7.5%
Total return
AHL TargetRisk 9 1.8% 8.7% 3.5% 6.0% 8.1%
Alternative Risk Premia 10 4.1% 11.4% 11.8% 5.7% 5.5%
GLG Global Emerging Markets Debt Total Return 11 1.9% 2.6% -0.9% -0.2% 0.7%
Multi-manager solutions
FRM Diversified II 12 -0.1% 5.6% 5.4% 5.5% 4.2%
Systematic long-only
Numeric Global Core 13 3.5% 16.1% 9.5% 12.9% 11.3%
Relative return 0.9% 4.4% 2.6% 1.1% 1.0%
Numeric Europe Core 14 2.5% 12.7% 9.1% 9.8% 9.1%
Relative return 1.2% 3.7% 1.7% 1.4% 2.3%
Numeric Emerging Markets Core 15 5.1% 12.7% -2.6% 6.2% 5.6%
Relative return 0.1% 5.2% 2.4% 3.1% 2.5%
Discretionary long-only
GLG Continental European Growth 16 -3.7% 7.7% 4.3% 8.9% 9.4%
Relative return -3.9% 0.6% -2.6% 0.4% 3.1%
GLG Japan CoreAlpha Equity 17 -0.5% 19.8% 23.4% 16.7% 6.8%
Relative return -2.2% -0.3% 7.5% 1.3% 1.9%
GLG Undervalued Assets 18 2.8% 7.5% 10.2% 6.2% 7.5%
Relative return -0.9% 0.1% 2.8% 0.7% 1.7%
GLG High Yield Opportunities 19 2.9% 6.3% 2.5% 6.5% 7.3%
Relative return 1.8% 3.6% 3.4% 5.0% 4.9%
GLG Sterling Corporate Bond 20 3.2% 8.7% - - 6.8%
Relative return 3.4% 8.8% - - 11.8%
Indices
HFRX Global Hedge Fund Index 21 0.4% 2.9% 0.4% 3.2%
HFRI Fund of Funds Conservative Index 21 0.9% 3.5% 3.6% 4.9%
HFRI Equity Hedge (Total) Index 21 1.0% 6.1% 1.9% 7.8%
HFRX EH: Equity Market Neutral Index 21 1.3% 4.2% 2.3% 0.9%
Barclay BTOP 50 Index 22 -2.2% 7.1% 7.8% 7.2%
*Estimated
Past or projected performance is no indication of future results. Financial
indices are used for illustrative purposes only and are provided for the
purpose of making a comparison to general market data as a point of reference
and should not be construed as a true comparison to the strategy.
The information herein is being provided solely in connection with this press
release and is not intended to be, nor should it be construed or used as,
investment, tax or legal advice, any recommendation or opinion regarding the
appropriateness or suitability of any investment or strategy, or an offer to
sell, or a solicitation of an offer to buy, an interest in any security,
including an interest in any fund or pool described herein.
1. Represented by AHL Alpha plc from 17 October 1995 to 30 September
2012, and by AHL Strategies PCC Limited: Class Y AHL Alpha USD Shares from 1
October 2012 to 30 September 2013. The representative product was changed at
the end of September 2012 due to the provisioning of fund liquidation costs in
October 2012 for AHL Alpha plc, which resulted in a tracking error compared
with other Alpha Programme funds. Both funds are valued weekly; however, for
comparative purposes, statistics have been calculated using the best quality
price that is available at each calendar month end, using estimates where a
final price is unavailable. Where a price, either estimate or final is
unavailable on a calendar month end, the price on the closest date prior to
the calendar month end has been used. Both track records have been adjusted to
reflect the fee structure of AHL Alpha (Cayman) Limited - USD Shares. From 30
September 2013, the actual performance of AHL Alpha (Cayman) Limited - USD
Shares is displayed.
2. Represented by AHL Strategies PCC Limited: Class B AHL Dimension
USD Shares from 3 July 2006 to 31 May 2014, and by AHL Dimension (Cayman) Ltd
- F USD Shares Class from 1 June 2014 until 28 February 2015 when AHL
Dimension (Cayman) Ltd - A USD Shares Class is used. Representative fees of
1.5% Management Fee and 20% Performance Fee have been applied.
3. Represented by AHL Evolution Limited adjusted for the fee structure
(2% p.a. management fee and 20% performance fee) from September 2005 to 31
October 2006; and by AHL Strategies PCC: Class G AHL Evolution USD from 1
November 2006 to 30 November 2011; and by the performance track record of AHL
Investment Strategies SPC: Class E AHL Evolution USD Notes from 1 December
2011 to 30 November 2012. From 1 December 2012, the track record of AHL
(Cayman) SPC: Class A1 Evolution USD Shares has been shown. All returns shown
are net of fees.
4. Represented by Man AHL Diversified plc from 26 March 1996 to 29
October 2012, and by Man AHL Diversified (Guernsey) USD Shares - Class A from
30 October 2012 to date. The representative product was changed at the end of
October 2012 due to legal and/or regulatory restrictions on Man AHL
Diversified plc preventing the product from accessing the Programme's revised
target allocations. Both funds are valued weekly; however, for comparative
purposes, statistics have been calculated using the best quality price that is
available at each calendar month end, using estimates where a final price is
unavailable. Where a price, either estimate or final is unavailable on a
calendar month end, the price on the closest date prior to the calendar month
end has been used.
5. Represented by Man GLG Alpha Select Alternative IL GBP; AUM
included within Discretionary equity under the absolute return product
category.
6. Represented by Man GLG Event Driven Alternative IN USD; AUM
included within Discretionary equity under the absolute return product
category.
7. Represented by GLG Market Neutral Fund - Class Z Restricted - USD
until 31 August 2007. From 1 September 2007, Man GLG Global Credit Multi
Strategy CL IL XX USD Unrestricted; AUM included within Other under the
absolute return product category.
8. Represented by Man Strategies 1783 Class F1 USD until 31st December
2021. From the 1st of January 2022 Man Strategies 1783 Class A USD; AUM
included within the corresponding product category.
9. Represented by Man AHL TargetRisk Class I USD.
10. Represented by Man Alternative Risk Premia SP - Class A USD.
11. Represented by Man GLG Global Emerging Markets Debt Total Return
Class I USD; AUM included within Emerging markets fixed income under the total
return product category.
12. Represented by FRM Diversified II Fund SPC - Class A USD ('the
fund') until April 2018 then Class A JPY hedged to USD thereafter. However,
prior to Jan 2004, FRM has created the FRM Diversified II pro forma using the
following methodology: i) for the period Jan 1998 to Dec 2003, by using the
returns of Absolute Alpha Fund PCC Limited - Diversified Series Share Cell
('AA Diversified - USD') adjusted for fees and/or currency, where applicable.
For the period Jan 2004 to Feb 2004, the returns of the fund's master
portfolio have been used, adjusted for fees and/or currency, where applicable.
Post Feb 2004, the fund's actual performance has been used, which may differ
from the calculated performance of the track record. There have been occasions
where the 12-months' performance to date of FRM Diversified II has differed
materially from that of AA Diversified. Strategy and holdings data relates to
the composition of the master portfolio; AUM included within Diversified and
thematic FoHF under the multi-manager solutions product category.
13. Performance relative to the MSCI World. This reference index is
intended to best represent the strategy's universe. Investors may choose to
compare returns for their accounts to different reference indices, resulting
in differences in relative return information. Comparison to an index is for
informational purposes only, as the holdings of an account managed by Numeric
will differ from the securities which comprise the index and may have greater
volatility than the holdings of an index.
14. Performance relative to the MSCI Europe (EUR). This reference index
is intended to best represent the strategy's universe. Investors may choose to
compare returns for their accounts to different reference indices, resulting
in differences in relative return information. Comparison to an index is for
informational purposes only, as the holdings of an account managed by Numeric
will differ from the securities which comprise the index and may have greater
volatility than the holdings of an index; AUM included within International
equity under the systematic long-only product category.
15. Performance relative to MSCI Emerging Markets. This reference index
is intended to best represent the strategy's universe. Investors may choose to
compare returns for their accounts to different reference indices, resulting
in differences in relative return information. Comparison to an index is for
informational purposes only, as the holdings of an account managed by Numeric
will differ from the securities which comprise the index and may have greater
volatility than the holdings of an index.
16. Represented by Man GLG Continental European Growth Fund Class C
Accumulation Shares. Relative return shown vs FTSE World Europe Ex UK (GBP,
GDTR); AUM included within Europe ex-UK equity under the discretionary
long-only product category.
17. Represented by Man GLG Japan CoreAlpha Fund - Class C converted to
JPY until 28 January 2010. From 1 February 2010 Man GLG Japan CoreAlpha Equity
Fund - Class I JPY is displayed. Relative return shown vs TOPIX (JPY, GDTR);
AUM included within Japan equity under the discretionary long-only product
category.
18. Represented by Man GLG Undervalued Assets Fund - C Accumulation
Shares. Relative return shown vs FTSE All Share (GBP, NDTR); AUM included
within UK equity under the discretionary long-only product category.
19. Represented by Man GLG High Yield Opportunities I EUR. Relative
return is shown vs ICE BofA Global High Yield Index (EUR, TR) Hedged
benchmark; AUM included within Credit and convertibles under the discretionary
long-only product category.
20. Represented by Man GLG Sterling Corporate Bond Fund Class C
Accumulation Shares. Relative return is shown vs ICE BofA Sterling Corporate
& Collateralized Index (GBR, TR); AUM included within Credit and
convertibles under the discretionary long-only product category.
21. HFRI and HFRX index performance over the past 4 months is subject to
change.
22. The historical Barclay BTOP 50 Index data is subject to change.
Chief Executive Officer's review
Overview
The first half of this year was positive for risk assets, building on 2023's
price momentum. The prevailing narrative was one of a 'Goldilocks' economy -
neither too hot to prolong interest rates at recent highs, nor too cold to
hinder growth. Monetary policy decisions, economic data releases and general
elections across the globe were closely monitored, frequently causing
short-term market volatility across asset classes. Despite lowering
expectations for rate cuts compared with the beginning of the year, investor
sentiment remained relatively stable, supported by robust corporate earnings
in the U.S. technology sector. Meanwhile, companies with exposure to
artificial intelligence continued to outperform, driving the S&P 500 index
up 14.5% to record highs during the first six months of 2024.
At our full year results in February, I outlined our strategic priorities to
deliver the next chapter of growth at Man Group. In doing so, I was conscious
not to overlook the existing strengths of our business: the range of
investment strategies and solutions we offer, our commitment to partnering
with sophisticated investors globally to solve their most complex problems,
and the quality of our talent, technology and institutional resources. It is
these strengths that have helped us to deliver significant growth over the
past few years and underpin another strong set of financial results for the
first six months of 2024 against the backdrop I have described above. I am
delighted that we continue to generate investment performance for our clients,
maintain our relevance with them, and deliver for our shareholders.
We generated investment performance of $11.1 billion in the first half, with
all our product categories contributing positively. Our absolute return
strategies gained 5.8%, with particularly notable returns from AHL Alpha
(+7.6%) and AHL Dimension (+7.5%), as well as our multi-strategy offering Man
1783 (+13.3%). After an excellent start to the year, AHL Evolution, which
charges performance fees at the end of June, incurred losses during the second
quarter amid the increased political uncertainty in Europe. While this
dampened the gains, it still ended the period in positive territory (+1.7%).
After a strong year in 2023, GLG Event Driven (+0.5%) also had a weaker period
of investment performance during the first six months of this year.
Our total return (+7.6%) and long-only (+12.0%) strategies also delivered
strong returns over the period, helped by positive momentum in equity markets;
Alternative Risk Premia and GLG Japan CoreAlpha Equity were standout
performers, delivering investment performance of +11.4% and +19.8%,
respectively, whereas returns from GLG Global Emerging Markets Debt were
softer (+2.6%).
I have said previously that the ability to deliver outperformance at scale is
one of the most exciting challenges ahead for our industry and I am delighted
that our overall relative investment performance in the first six months of
2024 was positive. During the period, Man Group's investment performance on an
asset-weighted basis was 2.1% ahead when compared with similar strategies
offered by other investment managers. This outperformance was achieved across
our alternative (+0.5%) and long-only (+4.3%) strategies, with notable
strength across the Man Numeric range. Our credit offering also performed
strongly, with High Yield and Sterling Corporate Bond strategies returning
+3.6% and +8.8% above their respective benchmarks on the liquid side. In
private credit, our portfolio has continued to generate strong outperformance
for clients, demonstrated by resilient underlying KPIs and minimal realised
losses. These outcomes are a real testament to the skill of our investment
teams, our culture of sophisticated risk management across investment
disciplines and our advanced technology platform.
While 2024 has remained a challenging period for fundraising in the asset
management sector, as institutions grapple with reduced realisations from
private equity allocations and higher interest rates, we continued to make
progress building deep and long-term relationships with asset allocators and
distributors around the globe. Client activity remained strong during the
first six months of the year, with total gross inflows of $20.4 billion (H1
2023: $15.0 billion). However, we experienced an increase in redemptions
during the first quarter of the year as a small number of large institutional
clients rebalanced their investment portfolios. Total net inflows were $0.9
billion for the period, 1.8% ahead of the industry, and I am pleased that we
continued to grow our market share during the first six months of 2024.
As we have said before, the institutional nature of our business can result in
some variability in near-term net flows. Our third quarter flows will be
impacted by a $6.7 billion redemption from a single client in systematic
long-only, following the strategic decision to switch their entire equities
allocation to a passively-managed, index-based portfolio. The mandate has a
net management fee margin of 21 basis points, and consequently it will have
minimal impact on the firm's profits. The institution first invested with us
in 2011 and since then we are proud to have delivered net investment
performance of 16% on an annualised basis and outperformed the benchmark by 2%
per annum on average.
Positive investment performance and net inflows, partially offset by negative
other impacts of $1.3 billion, increased total AUM to $178.2 billion as at 30
June 2024. This was 6% higher compared with 31 December 2023, reflecting
another period of organic growth and a new record for the firm. Core net
management fees were $551 million (H1 2023: $460 million), while core
performance fees were $170 million (H1 2023: $32 million). Growth in core
profitability resulted in core earnings per share (diluted) of 17.1 cents (H1
2023: 8.9 cents) and statutory earnings per share (diluted) of 13.8 cents (H1
2023: 6.8 cents). In line with our guidance, the Board has declared an interim
dividend of 5.6 cents per share (H1 2023: 5.6 cents).
Business development
During the period, we have made good progress against our multi-year strategic
objectives, which I believe are core to cementing our competitive advantage
and driving the growth of our business over the next few years. In February,
we announced a new structure that brings together all our discretionary
investment content under one division. The reorganisation around our core
competencies of Systematic, Discretionary and Solutions enables us to deliver
customised solutions to clients more efficiently, facilitates freer
cross-pollination of ideas, particularly in credit, and makes the firm easier
to understand and navigate.
Growing our credit capabilities is one of our priorities and I am proud of the
progress we have continued to make across the board in this area during the
first six months of the year. We now manage $10.7 billion in liquid credit and
convertibles (31 December 2023: $8.1 billion), with our teams continuing to
deliver exceptional investment performance. The pipeline of client interest
for our Credit Risk Sharing strategy, which manages securities referencing
high-quality loan portfolios originated and serviced by sponsor banking
institutions, remains strong. Lastly, the integration of the Varagon business
continues to advance smoothly, with fundraising initiatives and product
development plans progressing in line with our expectations. We expect to
launch an evergreen private credit strategy later in H2 2024, seeded by a
longstanding solutions client.
Product development, and innovation more broadly, strengthens our business by
diversifying our revenue streams, providing new opportunities for our people
and creating multiple options for future growth. Growing our presence in the
intermediated wealth channel is one of our priorities, with a focus on
developing more products suitable for distribution to retail investors, and we
now have joint ventures with market leaders in Italy and in Japan. In the
first half of the year, we launched the initial wave of products under the
Asteria JV, raising over $500 million in AUM. Both regions present a
significant opportunity for growth, and local partnerships like these help to
develop attractive offerings for the market while enabling efficient coverage.
Financial review
Core net revenue of $761 million (H1 2023: $513 million) primarily comprised
$551 million of core net management fees (H1 2023: $460 million), $170 million
(H1 2023: $32 million) of core performance fees and core gains on investments
of $39 million (H1 2023: $19 million). Core net management fees were 20%
higher than the comparative period due to an increase in total return and
long-only AUM, driven by strong investment performance and the contribution
from Varagon. Core performance fees of $170 million comprised $165 million
from alternative strategies across our investment divisions and $5 million
from long-only strategies.
Average net management fee margins were broadly in line with those for the
year ended 31 December 2023 across all product categories. The overall
run-rate net management fee margin at 30 June 2024 decreased by two basis
points to 63 basis points compared with 31 December 2023, with run-rate core
net management fees standing at $1,128 million at 30 June 2024 (31 December
2023: $1,087 million).
Run-rate core net management fees and margins
Run-rate core net management fees ($m)(1) Run-rate net management fee margin (bps)(1)
At 30 Jun 2024 At 31 Dec 2023 At 30 Jun 2024 At 31 Dec 2023
Absolute return 547 544 111 114
Total return 288 294 64 69
Multi-manager solutions 29 33 18 17
Systematic long-only 108 91 26 25
Discretionary long-only 156 125 58 58
Total 1,128 1,087 63 65
1. Run-rate net management fee margin is calculated as core net
management fees divided by average AUM on a fund-by-fund basis for the period
specified. Run-rate core net management fees applies the run-rate net
management fee margin to closing AUM. This is for illustrative purposes and
not a forecast.
Core compensation costs in the period were $358 million (H1 2023: $257
million), comprising $134 million of fixed compensation costs (H1 2023: $118
million) and $224 million of variable compensation costs (H1 2023: $139
million). The increase in fixed compensation was due to an increase in
headcount following the acquisitions of Varagon and Asteria in H2 2023, and as
a result of continued organic growth. The higher performance fees generated in
the period drove an increase in variable compensation costs and a decrease in
the compensation ratio to 47% from 50% in H1 2023.
Core other costs, including asset servicing and depreciation, were $126
million compared with $113 million for H1 2023. The acquisitions noted above
contributed to this increase along with inflationary pressures. The
strengthening of most currencies relative to the US dollar, particularly
sterling, during the period (1.27 USD:GBP in H1 2024 compared with 1.23
USD:GBP in H1 2023), increased fixed compensation and core other costs. Net
finance expense of $15 million was higher in H1 2024 than the comparative
period (H1 2023: $6 million), primarily due to higher average borrowings and
an increase in seed book financing.
Statutory profit before tax increased significantly to $219 million, from $114
million in the six months ended 30 June 2023, due to higher revenues from both
management and performance fees in the period. Similarly, core profit before
tax increased from $137 million to $257 million. Statutory earnings per share
on a diluted basis were 13.8 cents for the six months ended 30 June 2024
compared with 6.8 cents in H1 2023, with core earnings per share (diluted) up
from 8.9 cents in H1 2023 to 17.1 cents. Core management fee profit before tax
increased to $163 million (H1 2023: $133 million) and core management fee
earnings per share (diluted) increased 26% to 11.0 cents.
Capital management
Our robust balance sheet and liquidity positions allow us to invest in line
with our strategic priorities, support our long-term growth prospects and
maximise shareholder value. They also enable us to withstand periods of
stress.
As at 30 June 2024, we had net tangible assets of $779 million and net
financial assets of $411 million (31 December 2023: $782 million and $555
million, respectively). We had $121 million of available cash at 30 June 2024
(31 December 2023: $180 million) and had drawn $170 million on our revolving
credit facility (31 December 2023: $140 million). Seed investments decreased
to $549 million at 30 June 2024 (31 December 2023: $595 million), as mark to
market gains in the period were offset by net redemptions and additional seed
book financing. Total return swap exposure increased to $258 million at 30
June 2024 from $230 million at 31 December 2023 as a result. Additional
exposure to seed investments via repo arrangements at 30 June 2024 was $35
million compared with $45 million at 31 December 2023. We will continue to
manage our liquidity dynamically, within our existing parameters, and deploy
capital to invest in new products to drive the growth of the business.
The interim dividend of 5.6 cents per share is in line with the guidance
communicated previously. We intend to keep our interim dividend flat until
such time as the ratio of interim to final dividend is closer to 1:2, in line
with the broader UK market. Our business is highly cash-generative, and these
cash flows support a growing dividend over time. In H1 2024, we completed $31
million of the $50 million share repurchase announced in February.
Outlook
Political developments around the world, macroeconomic dynamics, and lower
private equity realisations are creating new challenges that our clients need
to grapple with. These themes will likely influence near-term allocation
decisions, increasing the level of unpredictability around net flows.
We remain well-positioned for growth, supported by the prevailing structural
trends in asset management towards more alternatives, liquidity and customised
solutions. Notwithstanding the systematic long-only redemption outlined
earlier, our positive momentum continues as we enter the second half of the
year, supported by solid investment performance across our investment
strategies, a high level of client engagement, and good progress against our
strategic priorities in line with our expectations.
We continue to be focused on generating investment performance irrespective of
market conditions, partnering with clients to find solutions to meet their
needs, and building a market-leading alternative investment management
business that is run for long-term success.
'Core' measures are alternative performance measures. For a detailed
description of our alternative performance measures, including non-core items,
please refer to pages 27 to 35.
Risk management
Risk management is an essential component of our approach, both to the
management of investment funds on behalf of investors, and the management of
Man Group's business on behalf of shareholders. Our reputation is fundamental
to our business, and maintaining our corporate integrity is the responsibility
of everyone at Man Group. Our approach is to identify, quantify and manage
risk throughout the firm, in accordance with the Board's risk appetite. We
maintain capital and liquidity to give us strategic and tactical flexibility,
both in terms of corporate and fund management.
The principal and emerging risks faced by Man Group are set out on pages 30 to
34 of our 2023 Annual Report and include: investment performance risk; key
person risk; counterparty risk; liquidity risk; investment book risk; pension
risk; risk of internal or external process failure; model and data integrity
risk; information and cybercrime security risk; information technology and
business continuity risk; legal, compliance and regulatory risk; reputational
risk; and climate change risk. These will continue to be our principal risks
for the second half of the financial year.
Our risk framework operated effectively in the six months to 30 June 2024,
with systems and controls functioning as designed.
Statement of directors' responsibilities
The directors confirm that, to the best of their knowledge, this condensed
consolidated set of financial statements in respect of Man Group plc for the
six month period ended 30 June 2024 has been prepared in accordance with IAS
34 'Interim Financial Reporting' as adopted by the United Kingdom, and that
this interim report includes a fair review of the information required by the
Financial Conduct Authority's Disclosure Guidance and Transparency Rules 4.2.7
and 4.2.8, namely:
· an indication of important events that have occurred during the
six months ended 30 June 2024 and their impact on the condensed interim
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the year ending 31 December
2024; and
· material related party transactions in the six months ended 30
June 2024 and any material changes in the related party transactions described
in the last Annual Report.
The directors of Man Group plc are:
Anne Wade - Board Chair
Robyn Grew - Chief Executive Officer
Antoine Forterre - Chief Financial Officer
Richard Berliand - Senior Independent Director
Lucinda Bell - Independent Non-executive Director
Ceci Kurzman - Independent Non-executive Director
Laurie Fitch - Independent Non-executive Director
Sarah Legg - Independent Non-executive Director
Dixit Joshi - Independent Non-executive Director
By order of the board
Robyn Grew
Chief Executive Officer
25 July 2024
Antoine Forterre
Chief Financial Officer
25 July 2024
Independent review report to Man Group Plc
Conclusion
We have been engaged by the Company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 30
June 2024 which comprises the Group income statement, the Group statement of
comprehensive income, the Group balance sheet, the Group statement of changes
in equity, the Group cash flow statement and related notes 1 to 14.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2024 is not prepared, in all
material respects, in accordance with United Kingdom adopted International
Accounting Standard 34 and the Disclosure Guidance and Transparency Rules of
the United Kingdom's Financial Conduct Authority.
Basis for Conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410 'Review of Interim Financial Information Performed by
the Independent Auditor of the Entity' issued by the Financial Reporting
Council for use in the United Kingdom (ISRE (UK) 2410). A review of interim
financial information consists of making inquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing (UK) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
As disclosed in note 1, the annual financial statements of Man Group are
prepared in accordance with United Kingdom adopted international accounting
standards. The condensed set of financial statements included in this
half-yearly financial report has been prepared in accordance with United
Kingdom adopted International Accounting Standard 34, 'Interim Financial
Reporting'.
Conclusion Relating to Going Concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for Conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This Conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410; however future events or conditions may cause the entity to
cease to continue as a going concern.
Responsibilities of the directors
The directors are responsible for preparing the half-yearly financial report
in accordance with the Disclosure Guidance and Transparency Rules of the
United Kingdom's Financial Conduct Authority.
In preparing the half-yearly financial report, the directors are responsible
for assessing Man Group's ability to continue as a going concern, disclosing
as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the
Company or to cease operations, or have no realistic alternative but to do so.
Auditor's Responsibilities for the review of the financial information
In reviewing the half-yearly financial report, we are responsible for
expressing to the Company a conclusion on the condensed set of financial
statements in the half-yearly financial report. Our Conclusion, including our
Conclusion Relating to Going Concern, is based on procedures that are less
extensive than audit procedures, as described in the Basis for Conclusion
paragraph of this report.
Use of our report
This report is made solely to the Company in accordance with ISRE (UK) 2410.
Our work has been undertaken so that we might state to the Company those
matters we are required to state to it in an independent review report and for
no other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the Company, for our review work,
for this report, or for the conclusions we have formed.
Deloitte LLP
Statutory Auditor
London, UK
25 July 2024
Interim financial statements
Group income statement
$m Note Six months to 30 June 2024 Six months to
30 June 2023
Management and other fees 564 474
Performance fees 169 32
Revenue 733 506
Net income or gains on investments and other financial instruments 8 67 30
Third-party share of gains relating to interests in consolidated funds 8 (14) (12)
Rental income 1 2
Distribution costs (17) (16)
Net revenue 770 510
Asset servicing costs (33) (27)
Compensation costs 3 (364) (257)
Other employment-related expenses 3 (22) -
Other costs 3 (98) (101)
Finance expense 4 (22) (14)
Finance income 4 7 8
Gain on disposal of investment property - right-of-use lease assets - 8
Amortisation of acquired intangibles (15) (11)
Share of post-tax loss of associates (2) (2)
Third-party share of post-tax profits (2) -
Statutory profit before tax 219 114
Tax expense 5 (55) (31)
Statutory profit attributable to owners of the Company 164 83
Statutory earnings per share: 12
Basic 14.1¢ 6.9¢
Diluted 13.8¢ 6.8¢
Group statement of comprehensive income
$m Six months to 30 June 2024 Six months to
30 June 2023
Statutory profit attributable to owners of the Company 164 83
Other comprehensive income/(loss):
Remeasurements of defined benefit pension plans 6 (4)
Deferred tax on pension plans (1) 1
Items that will not be reclassified to profit or loss 5 (3)
Cash flow hedges:
Valuation gains taken to equity 19 8
Realised gains transferred to Group income statement (17) (6)
Net investment hedges 3 2
Foreign currency translation (3) 1
Items that may be reclassified to profit or loss 2 5
Other comprehensive income 7 2
Total comprehensive income attributable to owners of the Company 171 85
Group balance sheet
Note At 30 June At 31 December
$m 2024 2023
Assets
Cash and cash equivalents 6 279 276
Fee and other receivables 755 551
Investments in fund products and other investments 8 2,581 2,279
Investments in associates 9 11
Current tax assets 28 15
Finance lease receivable 68 67
Leasehold improvements and equipment 57 53
Leasehold property - right-of-use lease assets 109 112
Investment property - right-of-use lease assets 16 17
Investment property - consolidated fund entities 8 30 30
Other intangibles 56 54
Deferred tax assets 128 128
Pension asset 18 12
Goodwill and acquired intangibles 761 776
Total assets 4,895 4,381
Liabilities
Borrowings 6 170 140
Trade and other payables 10 874 736
Provisions 11 15 16
Current tax liabilities - 3
CLO liabilities - consolidated fund entities 8 1,365 1,036
Third-party interest in consolidated funds 8 601 554
Third-party interest in other subsidiaries 1 1
Lease liability 273 283
Total liabilities 3,299 2,769
Net assets 1,596 1,612
Equity
Capital and reserves attributable to owners of the Company 1,596 1,612
Group cash flow statement
$m Note Six months to 30 June 2024 Six months to 30 June 2023
Operating activities
Cash generated from operations 7 285 179
Interest paid (15) (9)
Payment of lease interest (6) (5)
Tax paid (73) (63)
Cash flows from operating activities 191 102
Investing activities
Interest received 6 8
Purchase of leasehold improvements and equipment (10) (8)
Purchase of other intangibles (11) (10)
Cash flows used in investing activities (15) (10)
Financing activities
Repayments of lease liability principal (11) (7)
Purchase of Man Group plc shares by the Employee Trust (35) (56)
Proceeds from sale of Treasury shares in respect of Sharesave 1 -
Share repurchase programmes (including costs) (31) (223)
Ordinary dividends paid to Company shareholders (127) (118)
Transactions with non-controlling shareholders 3 -
Payment of third-party share of post-tax profits (2) -
Drawdown of borrowings 6 30 65
Cash flows used in financing activities (172) (339)
Net increase/(decrease) in cash and cash equivalents 4 (247)
Cash and cash equivalents at beginning of the period 276 457
Effect of foreign exchange movements (1) 2
Cash and cash equivalents at end of the period 6 279 212
Less: restricted cash held by consolidated fund entities 6 (158) (111)
Available cash and cash equivalents at the end of the period 6 121 101
Group statement of changes in equity
$m Share capital Reorg- Profit and loss account Man Group plc shares held by Employee Trust Treasury shares Cumulative translation adjustment Other reserves Total
anisation reserve
At 1 January 2023 46 (1,688) 3,590 (80) (225) 41 15 1,699
Statutory profit - - 83 - - - - 83
Other comprehensive loss - - (3) - - 3 2 2
Total comprehensive income - - 80 - - 3 2 85
Share-based payments (Note 3) - - 20 - - - - 20
Current tax on share-based payments - - 5 - - - - 5
Purchase of Man Group plc shares by the Employee Trust - - - (56) - - - (56)
Disposal of Man Group plc shares by the Employee Trust - - (30) 30 - - - -
Share repurchases - - (125) - - - - (125)
Transfer to Treasury shares - - 223 - (223) - - -
Transfer from Treasury shares - - (18) - 15 - 3 -
Cancellation of Treasury shares (1) - (103) - 103 - 1 -
Dividends paid - - (118) - - - - (118)
At 30 June 2023 45 (1,688) 3,524 (106) (330) 44 21 1,510
At 1 January 2024 45 (1,688) 3,621 (106) (326) 45 21 1,612
Statutory profit - - 164 - - - - 164
Other comprehensive income - - 5 - - - 2 7
Total comprehensive income - - 169 - - - 2 171
Share-based payments (Note 3) - - 22 - - - - 22
Current tax on share-based payments - - 1 - - - - 1
Deferred tax on share-based payments - - (1) - - - - (1)
Purchase of Man Group plc shares by the Employee Trust - - - (35) - - - (35)
Disposal of Man Group plc shares by the Employee Trust - - (29) 29 - - - -
Share repurchases - - (50) - - - - (50)
Transfer to Treasury shares - - 31 - (31) - - -
Transfer from Treasury shares - - (6) - 5 - 1 -
Disposal of Treasury shares for Sharesave - - - - 1 - - 1
Cancellation of Treasury shares (1) - (112) - 112 - 1 -
Transactions with non-controlling shareholders - - 2 - - - - 2
Dividends paid - - (127) - - - - (127)
At 30 June 2024 44 (1,688) 3,521 (112) (239) 45 25 1,596
1. Basis of preparation
These condensed consolidated interim financial statements (the 'interim
financial statements') for the six months ended 30 June 2024 have been
prepared in accordance with United Kingdom-adopted International Accounting
Standard 34 'Interim Financial Reporting', the Disclosure Guidance and
Transparency Rules of the Financial Conduct Authority and Article 106 of the
Companies (Jersey) Law 1991. The consolidated group is Man Group plc (the
Company) and its subsidiaries (together Man Group).
The financial information contained herein is unaudited and does not
constitute accounts within the meaning of Article 105 of the Companies
(Jersey) Law 1991. Statutory accounts for the year ended 31 December 2023,
which were prepared in accordance with International Financial Reporting
Standards (IFRS) and relevant IFRIC interpretations issued by the
International Accounting Standards Board (IASB) adopted by the United Kingdom,
upon which the auditor has given an unqualified and unmodified report, have
been delivered to the Jersey Registrar of Companies and were posted to
shareholders on 12 March 2024.
The accounting policies applied in these interim financial statements are
consistent with those applied in Man Group's Annual Report for the year ended
31 December 2023 (the '2023 Annual Report').
Impact of new accounting standards
There were no new or amendments to existing accounting standards issued by the
International Accounting Standards Board (IASB) effective for the first time
in the period to 30 June 2024 that have had a significant impact on these
interim financial statements.
No other standards or interpretations issued and not yet effective are
expected to have a material impact on the interim financial statements.
Going concern
The Board has determined that there is a reasonable expectation that Man Group
has sufficient resources to continue in operation for a period of at least
twelve months from the date of approval of these condensed consolidated
interim financial statements. Accordingly, the financial statements have been
prepared on a going concern basis.
2. Judgemental areas and accounting estimates
Critical judgements
Man Group acts as the investment manager or adviser to fund entities. A
significant area of judgement is whether we control certain of those fund
entities to which we are exposed via direct investment holdings, total return
swaps or sale and repurchase arrangements. We assess such relationships on an
ongoing basis to determine whether we control each fund entity and therefore
consolidate them into our results.
We have also applied judgement when selecting the appropriate vesting period
for put options over the economic interests in subsidiaries held by employees,
which are accounted for as cash-settled share-based payments. Since the
maximum settlement value of the options varies over time, different vesting
periods have been selected for the period over which each alternate value can
be earned. Changes in the fair value of these cash-settled share-based
payments will be recognised in the Group income statement up until the final
settlement date.
Critical accounting estimates
Man Group's key sources of estimation uncertainty include the valuation of the
net pension asset (as further described in Note 23 of the 2023 Annual Report),
the estimated amount of accrued variable compensation and the valuation of
employment related expenses arising from business combinations. The
determination of variable compensation is an annual process undertaken at the
calendar year end, therefore the accrual at 30 June 2024 is an estimated
amount based on the financial performance, including absolute levels of
performance fees, in the year to date.
The value of employment-related expenses arising from business combinations is
a further source of significant estimation uncertainty as the expenses are
determined with reference to the expected future value and performance of the
business acquired.
2. Judgemental areas and accounting estimates continued
The Board has also considered the assumptions used in the assessments for the
recoverability of deferred tax assets and the valuation of contingent
consideration and put options over non-controlling interests in subsidiaries.
They have concluded that these assumptions do not have a significant risk of
causing a material adjustment to the carrying amounts of our assets or
liabilities at the balance sheet date.
The impact of climate change on the interim financial statements, in
particular in relation to the going concern assessment, the cash flow
forecasts used in the valuation of non-current assets and the assumptions
around future life expectancies used in the valuation of the net pension
asset, is not currently expected to be material.
3. Costs
Compensation costs and other employment-related expenses
Six months to 30 June 2024 Six months to
$m 30 June 2023
Salaries 109 98
Variable cash compensation 151 67
Deferred compensation: share-based payment charge 22 20
Deferred compensation: fund product-based payment charge 42 40
Social security costs 29 23
Pension costs 11 9
Compensation costs 364 257
Other employment-related expenses 22 -
Total employment-related expenses recognised in the Group income statement 386 257
Comprising:
Fixed compensation: salaries and associated social security costs and pension 134 118
costs
Variable compensation: variable cash compensation, deferred compensation and 230 139
associated social security costs
Other employment related expenses 22 -
The unamortised deferred compensation at 30 June 2024 is $168 million (30 June
2023: $184 million) and has a weighted average remaining vesting period of 2.2
years (30 June 2023: 2.3 years). Of the $22 million other employment-related
expenses recognised in the period ended 30 June 2024, $3 million relates to
the portion of profits earned in the period which are payable to Varagon
selling shareholders.
Other costs
$m Six months to 30 June 2024 Six months to
30 June 2023
Technology and communications 14 12
Audit, tax, legal and other professional fees 14 11
Staff benefits 11 8
Occupancy 8 11
Temporary staff, recruitment, consultancy and managed services 7 6
Travel and entertainment 6 5
Insurance 3 2
Marketing and sponsorship 3 2
Other cash costs 3 5
Other costs - consolidated fund entities 4 5
Acquisition-related costs - 10
Total other costs before depreciation and amortisation 73 77
Depreciation of leasehold improvements and equipment 6 6
Depreciation of right-of-use lease assets 7 7
Amortisation of other intangibles 12 11
Total other costs 98 101
4. Finance expense and finance income
$m Six months to 30 June 2024 Six months to
30 June 2023
Finance expense:
Unwind of lease liability discount (6) (5)
Interest expense on total return swaps and sale and repurchase agreements (7) (5)
Other finance expense (9) (4)
Total finance expense (22) (14)
Finance income:
Interest on cash deposits 6 8
Unwind of finance lease discount 1 -
Total finance income 7 8
Net finance expense (15) (6)
5. Tax
The tax expense for the period of $55 million (H1 2023: $31 million) results
in a statutory effective tax rate of 25% (H1 2023: 27%). The decrease in rate
is primarily due to the impact of non-deductible acquisition-related costs and
the derecognition of a larger portion of the available US deferred tax assets
in H1 2023, partially offset by the increase in the UK corporation tax rate
from 19% to 25% on 1 April 2023 which increased our effective tax rate by
approximately 1% in the current period. The majority of our profit is earned
in the UK, Switzerland and the US. The forecast full year effective tax rate
is consistent with this profit mix.
We have recognised net accumulated deferred tax assets in the US of $84
million (31 December 2023: $86 million) that will be available to offset
future taxable profits. At 30 June 2024, deferred tax assets in relation to
$27 million of the available US state and city tax losses (31 December 2023:
$43 million) are unrecognised as we do not expect to realise sufficient future
taxable profits against which these losses can be offset before they expire.
Man Group became subject to the global minimum top-up tax under Pillar 2
legislation from 1 January 2024 and is liable for additional taxes in certain
jurisdictions in which we operate, notably Ireland, the US and Switzerland.
This impact, which is not significant, has been considered in determining the
weighted average tax rate.
We have applied the temporary exemption issued by the IASB in May 2023 from
the accounting requirements for deferred taxes in IAS 12 'Income Taxes'.
Accordingly, Man Group neither recognises nor discloses information about
deferred tax assets and liabilities related to Pillar 2 income taxes.
6. Cash, liquidity and borrowings
$m At 30 June At 31 December 2023
2024
Cash held with banks 69 92
Short-term deposits 39 46
Money market funds 13 42
Cash held by consolidated fund entities (Note 8) 158 96
Cash and cash equivalents 279 276
Less: cash held by consolidated fund entities (Note 8) (158) (96)
Available cash and cash equivalents 121 180
Undrawn committed revolving credit facility 630 660
Total liquidity 751 840
Borrowings
Our $800 million committed revolving credit facility (RCF) is immediately
accessible. It does not include any financial covenants to maintain maximum
operational flexibility. The RCF was put in place in December 2023 as a
five-year facility with two one-year extension options and is currently
scheduled to mature in December 2028. $170 million was drawn down at 30 June
2024 (31 December 2023: $140 million) and we have no other borrowings.
7. Reconciliation of statutory profits to cash generated from operations
$m Six months to 30 June 2024 Six months to
30 June 2023
Statutory profit 164 83
Adjustments for:
Share-based payment charge 22 20
Fund product-based payment charge 42 40
Other employment-related expenses 19 -
Net finance expense 15 6
Tax expense 55 31
Depreciation of leasehold improvements and equipment 6 6
Depreciation of right-of-use lease assets 7 7
Gain on disposal of investment property - right-of-use lease assets - (8)
Amortisation of acquired intangibles 15 11
Amortisation of other intangibles 12 11
Share of post-tax loss of associates 2 2
Foreign exchange movements 2 5
Realised gains on cash flow hedges (17) (6)
Other non-cash movements 4 (2)
348 206
Changes in working capital(1):
(Increase)/decrease in fee and other receivables (148) 208
Decrease in other financial assets and liabilities including consolidated fund 109 32
entities(2)
Decrease in trade and other payables (24) (267)
Cash generated from operations 285 179
Notes:
1. Changes in working capital differ from the movements in these
balance sheet items due to non-cash movements which either relate to the
gross-up of the third-party share of consolidated fund entities (Note 8) or
are adjusted elsewhere in the Group cash flow statement, such as movements
relating to the fund product-based payment charge (within cash flows from
operating activities) and the share repurchase liability (within financing
activities).
2. Includes $62 million of restricted net cash inflows (H1 2023: $3
million) relating to consolidated fund entities (Note 8).
8. Investments in fund products and other investments
$m At 30 June At 31 December
2024
2023
Investments in fund products 293 289
Investments in loans 18 -
Investments in consolidated funds: transferrable securities 2,269 1,987
Other investments 1 3
Investments in fund products and other investments 2,581 2,279
Less:
Fund investments held for deferred compensation arrangements (204) (189)
Investments in consolidated funds: exclude consolidation gross-up of net (1,827) (1,492)
investment
Other investments (1) (3)
Seed investments portfolio 549 595
From time to time, Man Group temporarily warehouses loans it underwrites and
originates with the intention of syndicating such loans following a short
period of time. These investments in loans are included within investments in
fund products and other investments on the Group balance sheet.
8. Investments in fund products and other investments continued
Net income or gains on investments and other financial instruments comprises
the following:
$m Six months to 30 June 2024 Six months to
30 June 2023
Net gains on seed investments portfolio 37 18
Consolidated fund entities: gross-up of net gains on investments 23 19
Foreign exchange movements 5 (8)
Net gains on fund investments held for deferred compensation arrangements and 2 1
other investments
Net income or gains on investments and other financial instruments 67 30
Consolidation of investments in funds
At 30 June 2024, our interests in 33 (31 December 2023: 35) funds met the
definition of control and therefore have been consolidated on a line-by-line
basis. Consolidated fund entities are included within the Group balance sheet
and income statement as follows:
$m At 30 June At 31 December
2024 2023
Balance sheet
Cash and cash equivalents (Note 6) 158 96
CLO assets 1,472 1,103
Other transferrable securities 797 884
Fee and other receivables 146 88
Investment property 30 30
Trade and other payables (Note 10) (195) (116)
CLO liabilities (1,365) (1,036)
Net assets of consolidated fund entities 1,043 1,049
Third-party interest in consolidated funds (601) (554)
Net investment held by Man Group 442 495
$m Six months to 30 June 2024 Six months to
30 June 2023
Income statement
Net gains on investments(1) 51 47
Management fee expenses(2) (4) (2)
Performance fee expenses(2) (1) -
Other costs(3) (4) (5)
Net gains of consolidated fund entities 42 40
Third-party share of gains relating to interests in consolidated funds (14) (12)
Net gains attributable to net investment held by Man Group 28 28
Notes:
1. Included within net income or gains on investments and other
financial instruments.
2. Relates to management and performance fees paid by the funds to Man
Group during the period, which are eliminated within management and other fees
and performance fees respectively in the Group income statement.
3. Includes depreciation and impairment of investment property held by
consolidated fund entities.
9. Fair value of financial assets and liabilities
The fair values of our financial assets and liabilities held at fair value
through profit and loss can be analysed as follows:
At 30 June 2024
$m Level 1 Level 2 Level 3 Total
Financial assets held at fair value
Investments in fund products and other investments (Note 8) - 282 12 294
Investments in loans (Note 8) - - 18 18
Investments in consolidated funds: transferrable securities (Note 8) 301 1,738 230 2,269
Derivatives - 2 - 2
301 2,022 260 2,583
Financial liabilities held at fair value
Derivatives (Note 10) - (4) - (4)
Contingent consideration (Note 10) - - (3) (3)
Put option over non-controlling interests in subsidiaries (Note 10) - - (9) (9)
CLO liabilities - consolidated fund entities (Note 8) - (1,365) - (1,365)
- (1,369) (12) (1,381)
At 31 December 2023
$m Level 1 Level 2 Level 3 Total
Financial assets held at fair value
Investments in fund products and other investments (Note 8) - 280 12 292
Investments in consolidated funds (Note 8) 274 1,567 146 1,987
Derivatives - 5 - 5
274 1,852 158 2,284
Financial liabilities held at fair value
Derivatives - (12) - (12)
Contingent consideration - - (3) (3)
Put option over non-controlling interests in subsidiaries - - (9) (9)
CLO liabilities - consolidated fund entities (Note 8) - (1,036) - (1,036)
- (1,048) (12) (1,060)
Level 1, 2 and 3 financial assets and liabilities are defined in Note 13 of
the 2023 Annual Report.
The movements in Level 3 financial assets and liabilities held at fair value
are as follows:
At 30 June At 31 December
2024 2023
$m Assets Liabilities Assets Liabilities
At beginning of the period 158 (12) 20 -
Transfers out of Level 3 - - (11) -
Purchases 18 - 2 (12)
Credit to Group income statement(1) - - 1 -
Change in consolidated fund entities held 84 - 146 -
At end of the period 260 (12) 158 (12)
Notes:
1. Included within net income or gains on investments and other
financial instruments. Includes net unrealised gains of nil (2023: $1
million).
Sensitivity analysis
A 5% increase/decrease in the valuations of Level 3 financial assets would
result in a $13 million increase/decrease in their value. Changes in the
unobservable inputs to the valuation of Level 3 financial liabilities would
not be expected to result in a significant change in the carrying value of
these liabilities, and hence a sensitivity analysis has not been presented.
10. Trade and other payables
$m At 30 June At 31 December
2024 2023
Trade payables 4 7
Compensation accruals 265 365
Other accruals 78 79
Payables under repo arrangements 35 45
Share repurchase liability 19 -
Payables to OEIC funds 150 39
Tax and social security 30 31
Derivatives 4 12
Contingent consideration 3 3
Put option over non-controlling interests in subsidiaries 9 9
Employment-related payables to sellers of businesses acquired 42 23
Other payables 40 7
Payables relating to consolidated fund entities (Note 8) 195 116
Trade and other payables 874 736
11. Provisions
$m At 30 June At 31 December
2024 2023
At beginning of the period 16 14
Unused amounts reversed (1) -
Additions - 1
Foreign currency translation - 1
At end of the period 15 16
Provisions relate to ongoing claims and leasehold property dilapidations.
12. Earnings per share (EPS)
Six months to 30 June 2024 Six months to
30 June 2023
(million) (million)
Basic weighted average number of shares 1,165 1,190
Dilutive impact of:
Employee share awards 26 25
Employee share options 1 2
Dilutive weighted average number of shares 1,192 1,217
Six months to 30 June 2024 Six months to
30 June 2023
Statutory profit ($m) 164 83
Basic EPS 14.1¢ 6.9¢
Diluted EPS 13.8¢ 6.8¢
13. Related party transactions
The related party transactions during the period are consistent with the
categories disclosed in the 2023 Annual Report. Related parties comprise key
management personnel, associates and fund entities which we control. All
transactions with related parties were carried out on an arm's length basis.
14. Other matters
In July 2019, the Public Institution for Social Security in Kuwait (PIFSS)
served a claim against a number of parties, including certain Man Group
companies, a former employee of Man Group and a former third-party
intermediary. The subject matter of these allegations dates back over a period
of 20 years. PIFSS is seeking compensation of $156 million (plus compound
interest) and certain other remedies which are unquantified in the claim. In
early 2024, PIFSS applied to amend its particulars of claim, including to
increase the quantum of the claim against Man Group companies. The amended
particulars of claim remain in draft form until further order of the court at
the date of authorisation of these condensed consolidated interim financial
statements. We continue to dispute the allegations and consider there is no
merit to the claim (in respect of liability and quantum) and will therefore
vigorously and robustly defend the proceedings.
We are subject to various other claims, assessments, regulatory enquiries and
investigations in the normal course of business. The Board does not expect
such matters to have a material adverse effect on our financial position.
ALTERNATIVE PERFORMANCE MEASURES
We assess our performance using a variety of alternative performance measures
(APMs). We discuss our results on a statutory as well as a 'core' basis. Core
metrics, which are each APMs, exclude acquisition and disposal-related items,
significant non-recurring items and volatile or uncontrollable items, as well
as profits or losses generated outside of our investment management business.
Accordingly, these core metrics reflect the way in which performance is
monitored by the Board and present the profits or losses which drive our cash
flows and inform the way in which our variable compensation is assessed.
Details of the non-core items in the period are set out below.
Our APMs also reclassify all income and expenses relating to our consolidated
fund entities, which are required by IFRS to be split across multiple lines in
the Group income statement, to core gains/losses on investments in order to
reflect their performance as part of our seed book programme. Tax on non-core
items and movements in deferred tax relating to the utilisation or recognition
of tax assets in the US are similarly excluded from core profit, with tax on
core profit considered a proxy for cash taxes paid.
In 2023, accounting for the acquisition of Varagon in accordance with the
requirements of IFRS resulted in the recognition of all future payments to
selling shareholders who remain in employment post-acquisition as
employment-related expenses. This arises because each of these payments can be
forfeited should those employees become 'bad leavers' during specified periods
following the acquisition. Economically, the payments are transactions with
the individuals in their capacity as owners. Recognising that these owners
also hold significant roles in the organisation, the 'bad leaver' clauses were
protective in nature and not intended to compensate the individuals for
employment services.
As these transactions are related to an acquisition, we consider it
appropriate to adjust the expense recognised in the period to reflect the
proportion of the profits which have been generated in the same period and are
attributable to these employees through an adjustment to core profit. This
more closely aligns the charges with the associated cash flows.
The approach to the classification of non-core items maintains symmetry
between losses and gains and the reversal of any amounts previously classified
as non-core. Note that our APMs may not be directly comparable with similarly
titled measures used by other companies.
Non-core items in profit before tax comprise the following:
$m Six months to Six months to
30 June 2024 30 June 2023
Acquisition and disposal related:
Amortisation of acquired intangibles (15) (11)
Acquisition-related costs - (10)
Other employment-related expenses(1) (19) -
Revaluation of contingent consideration (1) -
Share of post-tax loss of associates (2) (2)
Gain on disposal of investment property - right-of-use lease assets - 8
Compensation costs - restructuring (6) -
Foreign exchange movements 5 (8)
Non-core items (38) (23)
Note:
1. Adjustment to align acquisition-related employment-related expenses
with proportionate share of earnings in the year.
Core measures: reconciliation to statutory equivalents
The statutory line items within the Group income statement can be reconciled
to their core equivalents as follows:
Six months to 30 June 2024 Core measure Reclassification of amounts relating to consolidated fund entities Non-core items Per Group income statement
$m
Management and other fees( APM ) 568 (4) - 564
Performance fees( APM ) 170 (1) - 169
Revenue( APM ) 738 (5) - 733
Net income or gains on investments and other financial instruments( APM ) 39 23 5 67
Third-party share of gains relating to interests in consolidated funds - (14) - (14)
Rental income( APM ) 1 - - 1
Distribution costs (17) - - (17)
Net revenue( APM ) 761 4 5 770
Asset servicing costs (33) - - (33)
Compensation costs( APM ) (358) - (6) (364)
Other employment-related expenses( APM ) (3) - (19) (22)
Other costs( APM ) (93) (4) (1) (98)
Net finance expense (15) - - (15)
Amortisation of acquired intangibles - - (15) (15)
Share of post-tax loss of associates - - (2) (2)
Third-party share of post-tax profits (2) - - (2)
Profit before tax( APM ) 257 - (38) 219
Tax expense( APM ) (53) - (2) (55)
Profit( APM ) 204 - (40) 164
Core basic EPS 17.5¢
Core diluted EPS 17.1¢
APM The core equivalents of these statutory measures are defined as
Alternative Performance Measures.
Core measures: reconciliation to statutory equivalents continued
Six months to 30 June 2023 Core Reclassification of amounts relating to consolidated Non-core items Per Group income statement
$m
measure fund entities
Management and other fees( APM ) 476 (2) - 474
Performance fees( APM ) 32 - - 32
Revenue( APM ) 508 (2) - 506
Net income or gains on investments and other financial instruments( APM ) 19 19 (8) 30
Third-party share of gains relating to interests in consolidated funds - (12) - (12)
Rental income 2 - - 2
Distribution costs (16) - - (16)
Net revenue( APM ) 513 5 (8) 510
Asset servicing costs (27) - - (27)
Compensation costs (257) - - (257)
Other costs( APM ) (86) (5) (10) (101)
Net finance expense (6) - - (6)
Gain on disposal of investment property - right-of-use lease assets - - 8 8
Amortisation of acquired intangibles - - (11) (11)
Share of post-tax loss of associates - - (2) (2)
Profit before tax( APM ) 137 - (23) 114
Tax expense( APM ) (29) - (2) (31)
Profit( APM ) 108 - (25) 83
Core basic EPS 9.1¢
Core diluted EPS 8.9¢
APM The core equivalents of these statutory measures are defined as
Alternative Performance Measures.
Core measures: reconciliation to statutory equivalents continued
The statutory line items within the Group balance sheet can be reconciled to
their core equivalents as follows:
At 30 June 2024 Core Reclassification of amounts relating to consolidated fund entities Per Group balance sheet
$m
measure
Assets
Cash and cash equivalents( APM ) 121 158 279
Fee and other receivables( APM ) 609 146 755
Investments in fund products and other investments( APM ) 754 1,827 2,581
Investments in associates 9 - 9
Current tax assets 28 - 28
Finance lease receivable 68 - 68
Leasehold improvements and equipment 57 - 57
Leasehold property - right-of-use lease assets 109 - 109
Investment property - right-of-use lease assets 16 - 16
Investment property - consolidated fund entities - 30 30
Other intangibles 56 - 56
Deferred tax assets 128 - 128
Pension asset 18 - 18
Goodwill and acquired intangibles 761 - 761
Total assets 2,734 2,161 4,895
Liabilities
Borrowings 170 - 170
Trade and other payables( APM ) 679 195 874
Provisions 15 - 15
CLO liabilities - consolidated fund entities - 1,365 1,365
Third-party interest in consolidated funds - 601 601
Third-party interest in other subsidiaries 1 - 1
Lease liability 273 - 273
Total liabilities 1,138 2,161 3,299
Net assets 1,596 - 1,596
APM The core equivalents of these statutory measures are defined as
Alternative Performance Measures.
Core measures: reconciliation to statutory equivalents continued
At 31 December 2023 Core Reclassification Per Group
$m
measure
balance sheet
of amounts relating to consolidated
fund entities
Assets
Cash and cash equivalents( APM ) 180 96 276
Fee and other receivables( APM ) 463 88 551
Investments in fund products and other investments( APM ) 787 1,492 2,279
Investments in associates 11 - 11
Current tax asset 15 - 15
Finance lease receivable 67 - 67
Leasehold improvements and equipment 53 - 53
Leasehold property - right-of-use lease assets 112 - 112
Investment property - right-of-use lease assets 17 - 17
Investment property - consolidated fund entities - 30 30
Other intangibles 54 - 54
Deferred tax assets 128 - 128
Pension asset 12 - 12
Goodwill and acquired intangibles 776 - 776
Total assets 2,675 1,706 4,381
Liabilities
Borrowings 140 - 140
Trade and other payables( APM ) 620 116 736
Provisions 16 - 16
Current tax liabilities 3 - 3
CLO liabilities - consolidated fund entities - 1,036 1,036
Third-party interest in consolidated funds - 554 554
Third-party interest in other subsidiaries 1 - 1
Lease liability 283 - 283
Total liabilities 1,063 1,706 2,769
Net assets 1,612 - 1,612
APM The core equivalents of these statutory measures are defined as
Alternative Performance Measures.
Core management fee and core performance fee profit
Core profit comprises core management fee profit, a steadier earnings stream,
and core performance fee profit, a more variable earnings stream. This split
facilitates analysis of our profitability drivers.
Six months to 30 June 2024 Core Reclassification of amounts relating to consolidated fund entities Non-core items Per Group
$m
measure
income statement
Management and other fees 568 (4) - 564
Distribution costs (17) - - (17)
Net management fees 551 (4) - 547
Rental income 1 - - 1
Asset servicing costs (33) - - (33)
Compensation costs (management fee) (251) - (6) (257)
Other employment-related expenses (3) - (19) (22)
Other costs (93) (4) (1) (98)
Net finance expense (management fee) (8) - - (8)
Third-party share of post-tax profits (management fee) (1) - - (1)
Management fee profit before tax 163 (8) (26) 129
Tax expense (32)
Management fee profit 131
Core basic management fee EPS 11.2¢
Core diluted management fee EPS 11.0¢
Performance fees 170 (1) - 169
Net income or gains on investments and other financial instruments 39 23 5 67
Compensation costs (performance fee) (107) - - (107)
Net finance expense (performance fee) (7) - - (7)
Third-party share of post-tax profits (performance fee) (1) - - (1)
Performance fee profit before tax 94 22 5 121
Tax expense (21)
Performance fee profit 73
Core basic performance fee EPS 6.3¢
Core diluted performance fee EPS 6.1¢
Core management fee and core performance fee profit continued
Six months to 30 June 2023 Core Reclassification of amounts relating to consolidated fund entities Non-core items Per Group
$m
measure
income statement
Management and other fees 476 (2) - 474
Distribution costs (16) - - (16)
Net management fees 460 (2) - 458
Rental income 2 - - 2
Asset servicing costs (27) - - (27)
Compensation costs (management fee) (215) - - (215)
Other costs (86) (5) (10) (101)
Net finance expense (management fee) (1) - - (1)
Management fee profit before tax 133 (7) (10) 116
Tax expense (28)
Management fee profit 105
Core basic management fee EPS 8.9¢
Core diluted management fee EPS 8.7¢
Performance fees 32 - - 32
Net income or gains/(losses) on investments and other financial instruments 19 19 (8) 30
Compensation costs (performance fee) (42) - - (42)
Net finance expense (performance fee) (5) - - (5)
Performance fee profit before tax 4 19 (8) 15
Tax expense (1)
Performance fee profit 3
Core basic performance fee EPS 0.2¢
Core diluted performance fee EPS 0.2¢
Core gains/losses on investments
We use the measure core gains/losses on investments to represent the net
return we receive on our seed investments portfolio, combining both
consolidated and unconsolidated fund entities on a consistent basis. We
therefore exclude from this measure gains or losses on investments which do
not relate to the performance of the seed book and adjust the amounts relating
to consolidated funds to be included in this line on a consistent basis. Core
gains/losses on investments can be reconciled to the Group income statement as
follows:
$m Note Six months to Six months to
30 June 2024 30 June 2023
Net gains on seed investments portfolio 8 37 18
Net gains on fund investments held for deferred compensation arrangements and 8 2 1
other investments
Core gains on investments 39 19
Non-core items:
Consolidated fund entities: gross-up of net gains on investments 8 23 19
Foreign exchange movements 8 5 (8)
Net income or gains on investments and other financial instruments 67 30
Core tax rate
The core tax rate is the effective tax rate on core profit before tax and is
equal to the tax on core profit divided by core profit before tax. The tax
expense on core profit before tax is calculated by excluding the tax
benefit/expense related to non-core items from the statutory tax expense,
together with amounts relating to the utilisation or recognition of available
US deferred tax assets. Therefore, tax on core profit is considered a proxy
for our cash taxes payable.
The impact of non-core items on our tax expense is outlined below:
$m Six months to 30 June 2024 Six months to
30 June 2023
Statutory tax expense 55 31
Tax on non-core items:
Amortisation of acquired intangibles - 1
Gain on disposal of investment property - right-of-use lease assets - (2)
Foreign exchange movements 1 3
Compensation costs - restructuring (1) -
Non-core tax item on US deferred tax assets (2) (4)
Core tax expense 53 29
Comprising:
Tax expense on core management fee profit before tax 32 28
Tax expense on core performance fee profit before tax 21 1
The core tax rate is 21% for H1 2024 (H1 2023: 21%).
Core cash flows from operations excluding working capital movements
Core cash flows from operations excluding working capital movements can be
reconciled to cash flows from operating activities as reported in the Group
cash flow statement as follows:
$m Six months to 30 June 2024 Six months to
30 June 2023
Cash flows from operating activities 191 102
Plus changes in working capital (Note 7):
Increase/(decrease) in fee and other receivables 148 (208)
Decrease in other financial assets (109) (32)
Decrease in trade and other payables 24 267
Core cash flows from operations excluding working capital movements 254 129
Net financial assets
Net financial assets is considered a proxy for Group capital, and is equal to
our cash and seed book less borrowings, contingent consideration payable,
liabilities for put options over non-controlling and employee interests and
payables under repo arrangements, as follows:
$m Note At 30 June At 31 December 2023
2024
Seed investments portfolio 8 549 595
Available cash and cash equivalents 6 121 180
Borrowings 6 (170) (140)
Contingent consideration payable 10 (3) (3)
Put option over non-controlling interests in subsidiaries 10 (9) (9)
Put option over employee interests in subsidiaries 10 (42) (23)
Payables under repo arrangements 10 (35) (45)
Net financial assets 411 555
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