REG - Ninety One PLC - Final Results
17/05/2023 07:00
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RNS Number : 6351Z Ninety One PLC 17 May 2023
Ninety One plc Ninety One Limited
Incorporated in England and Wales Incorporated in the Republic of South Africa
Registration number 12245293 Registration number 2019/526481/06
Date of registration: 4 October 2019 Date of registration: 18 October 2019
LSE share code: N91 JSE share code: NY1
JSE share code: N91 ISIN: ZAE000282356
ISIN: GB00BJHPLV88
Results for the year ended 31 March 2023
17 May 2023
Highlights
- A year of significant headwinds.
- Solid financial performance, supported by cost discipline.
- Assets under management ("AUM") decreased by 10% to £129.3 billion,
average AUM reduced by 3% to £134.9 billion.
- Net outflows of £10.6 billion.
- Competitive firm-wide investment performance with three-year
outperformance at 71%.
- Profit before tax reduced by 20% to £212.6 million. Adjusted
operating profit decreased by 10% to £206.9 million.
- Basic earnings per share decreased 19% to 18.2p and adjusted
earnings per share decreased 10% to 17.3p.
- Strong balance sheet with no debt.
- Proposed final dividend of 6.7p per share, resulting in a full year
dividend of 13.2p per share.
Key financials((1)) Full year 2023 Full year 2022 Change
%
AUM (£'bn) 129.3 143.9 (10)
Net flows (£'bn) (10.6) 5.0 n.m.
Average AUM (£'bn) 134.9 138.6 (3)
Profit before tax (£'m) 212.6 267.1 (20)
Adjusted operating profit (£'m) 206.9 230.4 (10)
Adjusted operating profit margin (%) 32.7 34.7 n.m.
Basic earnings per share (p) 18.2 22.6 (19)
Basic headline earnings per share (p) 18.2 21.4 (15)
Adjusted earnings per share (p) 17.3 19.2 (10)
Dividend per share (p) 13.2 14.6 (10)
Note: (1) Please refer to explanations and definitions, including alternative
performance measures, on pages 13-16.
Hendrik du Toit, Founder and Chief Executive Officer, commented:
"The past year was challenging for Ninety One. We faced significant headwinds.
We nevertheless remain confident of the underlying strength of our business
and the relevance and quality of our proposition to clients. Our people are
united and motivated to serve our clients and unlock the compelling long-term
growth potential of Ninety One.
For further information please contact:
Investor relations
Varuni Dharma
varuni.dharma@ninetyone.com
(mailto:varuni.dharma@ninetyone.com) +44(0) 203 938 2486
Eva Hatfield
eva.hatfield@ninetyone.com
(mailto:eva.hatfield@ninetyone.com) +44(0) 203 938 2908
Media enquiries
Jeannie Dumas (for UK)
jeannie.dumas@ninetyone.com
(mailto:jeannie.dumas@ninetyone.com) +44 (0) 203 938 3084
Kotie Basson (for South Africa)
kotie.basson@ninetyone.com +27 (0) 82 375 1317
Investor presentation
A presentation to investors and financial analysts will be held at our London
office (55 Gresham Street, EC2V 7EL) at 9.00 am BST on 17 May 2023. There will
be a live webcast available for those unable to attend. The webcast
registration link is available at https://ninetyone.com/full-year-results
(https://ninetyone.com/full-year-results) .
A copy of the presentation will be made available on the Company's website
https://ninetyone.com/full-year-results-2023
(https://ninetyone.com/full-year-results-2023) at 8.00 am BST.
Forward-looking statements
This announcement does not constitute or form part of any offer, advice,
recommendation, invitation or inducement to any person to underwrite,
subscribe for or otherwise acquire or dispose of securities in Ninety One plc
and its subsidiaries or Ninety One Limited and its subsidiaries (together,
"Ninety One"), nor should it be construed as legal, tax, financial, investment
or accounting advice.
This announcement may include statements that are, or may be deemed to be,
"forward-looking statements". These forward-looking statements may be
identified by the use of forward-looking terminology, including the terms
"believes", "estimates", "plans", "projects", "anticipates", "expects",
"intends", "may", "will" or "should" or, in each case, their negative or other
variations or comparable terminology, or by discussions of strategy, plans,
objectives, goals, future events or intentions. Forward-looking statements may
and often do differ materially from actual results. Any forward-looking
statements contained in the announcement reflect Ninety One's current view
with respect to future events and are subject to risks relating to future
events and other risks, uncertainties and assumptions relating to the Ninety
One's business, results of operations, financial position, liquidity,
prospects, growth and strategies. Forward-looking statements speak only as of
the date of this announcement.
Except as required by any applicable law or regulation, Ninety One expressly
disclaims any obligation or undertaking to release publicly any updates or
revisions to any forward-looking statements contained in this announcement or
any other forward-looking statements it may make whether as a result of new
information, future developments or otherwise.
About Ninety One
Ninety One is an active investment manager, investing capital on behalf of its
clients to help them achieve their long-term financial objectives.
Ninety One is listed on the London and Johannesburg Stock Exchanges.
CHIEF EXECUTIVE OFFICER'S REVIEW
The 2023 financial year has been difficult for our industry and for Ninety
One. Coming off a record year in 2022, we faced the combination of higher
inflation, the fastest rise in interest rates since we started the business,
heightened geopolitical uncertainty, a liability-driven investing ("LDI")
crisis in the UK, significant bank failures in the developed world and energy
shortages across the world. All of this led to unprecedented risk-aversion
among asset owners. This created significant headwinds for a firm like ours,
which primarily offers "risk-on", public-market strategies.
Furthermore, and regrettably, we have to mention the deterioration of economic
prospects in our original home market, South Africa, where we have a
substantial business. We consider it our duty to call this out, but also to
work constructively with government, civil society and other stakeholders to
improve this situation.
These circumstances have impacted our results, in particular, our net flows.
However, it has not dampened our motivation. Ours is a battle-hardened and
resilient business, adept at navigating change and finding opportunity.
Solid financial results
Despite the challenges, Ninety One delivered solid financial results.
Our adjusted operating profit decreased by 10% to £206.9 million (2022:
£230.4 million). The adjusted earnings per share ("EPS") decreased by 10%,
while the basic EPS declined by 19%. The difference between the adjusted and
basic EPS reflects the profit from the sale of Silica and the share scheme net
credit in the prior year.
In a year of cost pressures fuelled by the highest developed market inflation
rates in decades, our variable compensation model has cushioned the decline in
underlying earnings. We believe that this alignment between staff compensation
and shareholder experience is vital for the integrity of our business model,
in good and bad times.
AUM declined by 10% and Ninety One experienced net outflows of £10.6 billion.
We are working hard to regain positive momentum after a difficult second
half.
Consistent long-term strategy
Our value proposition rests on a combination of competitive investment
performance, relevant offerings, consistent strategy focused on the long term
and the quality of our people. The latter point is underpinned by a strong
culture and attractive working environment for talent.
Over the past year, the majority of the strategies offered by Ninety One were
not aligned with the immediate preference of asset owners for lower risk or
uncorrelated assets. Our skillsets have been carefully developed and curated
over many years. We remain committed to our long-term strategy. We must be
able to withstand periods of low demand, ply our trade and build the track
records and capacity that clients require when they want to allocate to the
investment strategies we offer.
Our business strategy has not changed. To build strong market positions takes
time and commitment and the discipline not to change tack to pursue short-term
market opportunities. Over time we intend to grow by offering client-relevant
strategies which produce good long-term results. In the active investment
management industry this is referred to as alpha. This requires a combination
of consistency and creativity. Creativity is key to successful innovation over
time. In this highly competitive industry, those who fail to raise their game
year after year inevitably fall behind.
Investing for long-term growth
At Ninety One, we talk about investing for a world of change. It is not easy,
but it can be rewarding. We know that somewhere in the discomfort of adverse
conditions and rapid change, lies opportunity. We have identified long-term
opportunities, which match our capabilities, and intend to pursue them with
vigour. These include global and international equities, emerging market
equities, emerging market fixed income, including specialist credit and
sustainable investing.
In spite of the flow picture over the year, we have continued to build our
business. We invest via the cost line to support our long-term organic growth.
We have a solid platform for future growth, with a brand that is widely
recognised in its chosen channels, and a track record of successful organic
growth and investment performance. We have continued to focus on a smaller
number of strategies with the intention to scale them, which we believe will
help us to grow meaningfully. Currently we are innovating in the
sustainability space where we expect growth in the coming years.
We continue to roll out new strategies in selected areas. New strategies
contributed meaningfully to net inflows in recent years. We regularly cut
strategies and products where we do not foresee demand over the long term. The
yin of long-term stability and the yang of creativity and innovation are key
elements of our formula for sustained organic growth over the long term.
We have maintained our market-leading position in South Africa where growth
prospects have been dampened by weak economic performance. Ninety One is
better equipped than most of its domestic competitors to deal with the recent
liberalisation of exchange controls in South Africa. The outcome has not been
positive for the South African industry. The growth in international
allocations by domestic asset owners was shared with international
competitors.
Across our Client Groups we have experienced flow pressure, often due to asset
allocation decisions as opposed to dissatisfaction with service or
performance. We do not expect the bulk of those big allocation changes to be
repeated over the coming year and we intend to regain those allocations when
market conditions normalise.
At Ninety One, we consider the North American institutional and sub advice
opportunities as a primary medium-term growth drivers. We remain confident
that our investment in North America will pay off. We have and will be
investing further to build our presence in the Middle East, specifically in
the Kingdom of Saudi Arabia, to capture the opportunities in that fast-growing
region. Our UK business has suffered from the fallout of the LDI-related
sell-off of risk assets to meet margin calls and further de-risking of defined
benefit pension pots on the back of the rise in long-term interest rates. We
therefore also need to sharpen our focus in this market which is undergoing
rapid change.
In the coming year, Ninety One will continue to face its fair share of
challenges. These could potentially include volatile and possibly unsupportive
financial market conditions, further bank failures, hostile macroeconomic
conditions, muted interest in emerging markets investing, the implications of
the substantial relaxation of exchange controls relating to South African
institutional investors and the increased regulatory and public scrutiny of
sustainable investing. Since inception, we have navigated varied market
conditions and embraced change successfully because of the efforts and
resourcefulness of our people.
Although we acknowledge the much-publicised structural challenges facing the
investment management industry, we remain resolute that this industry is full
of opportunity. Investment management at its core is a talent and results
business. Therefore, culture and consistent commitment to improvement really
matter. Scale helps, but at the high-value end, there are many other more
important success factors.
People and culture
Our culture remains strong and our people remain motivated to unlock the full
potential of Ninety One. We think and act like owners, not employees. Our
people now collectively own over 28% of the equity in Ninety One. This is an
indication of long-term orientation and appropriate alignment of interests
with our stakeholders.
Outlook
At our last interim results, we pointed to risks that could make market
conditions less supportive than at the outset of this reporting period. Many
of those have materialised and were accentuated by the policy response to
persistently higher-than-desired inflation rates. Despite the market rally
towards the end of the financial year, the coming reporting period will remain
full of challenges and we enter it with appropriate levels of caution.
As we have done since inception in 1991, we continue to invest for long-term
growth. Ninety One is a resilient business, with a largely risk-on product
offering and a track record of navigating difficult conditions and change. We
see ample growth opportunities ahead as risk appetite returns, so long as we
keep delivering for our clients and serve society at large. We are mindful of
the fact that we have no business without the support of our clients and the
communities within which we operate. We thank them and our other stakeholders
profoundly for their support after 32 years in business.
We will remain actively involved in the move to a more sustainable future,
including the financing of this multi-decade transition. Our stated purpose
is, after all, to invest for a better tomorrow.
Our focus remains firmly on execution. We look to the future with confidence.
OPERATING REVIEW
Assets under management ("AUM")
Closing AUM decreased by 10% to £129.3 billion (31 March 2022: £143.9
billion), reflecting net outflows and lower asset prices. The market and
foreign exchange impact was (£4.0) billion (2022: £8.0 billion).
AUM by asset class
£ million 31 March 2023 31 March 2022 Change %
Equities 59,782 68,017 (12)
Fixed income 32,976 36,690 (10)
Multi-asset 22,605 25,165 (10)
Alternatives 3,990 4,065 (2)
South African fund platform 9,913 10,002 (1)
Total 129,266 143,939 (10)
Our AUM remained well diversified across asset classes, with the mix of AUM
broadly unchanged from the prior year. Our three largest asset classes saw net
outflows in the year while all asset classes were affected by negative markets
in the period.
AUM by Client Group
£ million 31 March 2023 31 March 2022 Change %
United Kingdom 24,890 27,201 (8)
Africa 51,418 56,128 (8)
Europe 15,480 17,057 (9)
Americas 16,846 17,873 (6)
Asia Pacific 20,632 25,680 (20)
Total 129,266 143,939 (10)
AUM remains well diversified by client geography ("Client Groups") and the
split remained broadly in line with the prior year. All regions suffered net
outflows.
AUM by client type
£ million 31 March 2023 31 March 2022 Change %
Advisor 46,466 48,229 (4)
Institutional 82,800 95,710 (13)
Total 129,266 143,939 (10)
The split of AUM between the institutional and advisor channels remained
broadly consistent with the prior year and both channels experienced net
outflows.
Net flows
We suffered net outflows of £10.6 billion (2022: net inflows of £5.0
billion) in financial year 2023. The second half of the year drove the bulk of
these outflows and more than half of the annual net outflows were driven by
the asset allocation decisions of three clients, though all still remain
clients.
Net flows by asset class
£ million 31 March 2023 31 March 2022
Equities (6,912) 1,572
Fixed income (2,942) 2,445
Multi-asset (1,166) 215
Alternatives 42 284
South African fund platform 330 500
Total (10,648) 5,016
Almost two thirds of net outflows were driven by equities, particularly from
global and Asian core equity strategies and UK equities. Notwithstanding this,
there were still net inflows into some of our focus strategies such as global
quality, sustainable and natural resources equity strategies. Fixed income net
outflows were driven largely from emerging market sovereign strategies.
Multi-asset net outflows were broadly spread, including from South African and
income strategies. Inflows into our fund platform remained healthy while net
inflows into Alternatives were driven by the growing interest in our
multi-asset credit strategies.
Net flows by Client Group
£ million 31 March 2023 31 March 2022
United Kingdom (2,283) 378
Africa (1,170) 1,801
Europe (1,521) 782
Americas (954) 1,555
Asia Pacific (4,720) 500
Total (10,648) 5,016
We experienced net outflows in all Client Groups. The Asia Pacific Client
Group saw the majority of outflows over the year. In the UK, much of the net
outflows were driven by the impact of collateral calls resulting from the
fallout of the LDI-related sell-off of risk assets to meet margin calls and
further de-risking of defined benefit pension pots. Fund platform inflows into
the Africa Client Group were offset by larger net outflows in fixed income
strategies. For the Europe and Americas Client Groups, net outflows were
driven by client reallocations and de-risking.
Net flows by client type
£ million 31 March 2023 31 March 2022
Advisor (239) 2,484
Institutional (10,409) 2,532
Total (10,648) 5,016
The institutional channel experienced large net outflows driven by global
equities (mainly driven by the Asia Pacific Client Group) and fixed income
strategies (driven by the UK Client Group). Although there were some
significant Advisor inflows (from the South African fund platform), these were
offset by larger outflows from other regions.
Investment performance
Firm-wide investment performance((1))
Our firm-wide investment performance remained competitive and we are pleased
to report an improving trend in the short- and medium-term. As at the end of
March 2023, our one- and three-year outperformance stood at 57% and 71%
respectively (31 March 2022: 50% and 68% respectively).
Our longer-term firm-wide outperformance remained competitive, with the five-
and ten-year outperformance closing at 76% and 81% respectively (31 March
2022: 80% and 86% respectively).
1 Year 3 Year 5 Year 10 Year Since inception
Outperformance 57% 71% 76% 81% 75%
Underperformance 43% 29% 24% 19% 25%
Note: (1) Firm-wide outperformance is calculated as the sum of the total
market values for individual portfolios that have positive active returns on a
gross basis expressed as a percentage of total AUM. Our percentage of firm
outperformance is reported on the basis of current AUM and therefore does not
include terminated funds. Total AUM excludes double-counting of pooled
products and third party assets administered on our South African fund
platform. Benchmarks used for the above analysis include cash, peer group
averages, inflation and market indices as specified in client mandates or fund
prospectuses. For all periods shown, market values are as at the period end
date.
Mutual fund investment performance((1))
During financial year 2023, Ninety One's mutual fund investment performance on
a one-year basis improved significantly, with 72% of mutual funds in the first
or second quartiles (31 March 2022: 36%). However, on a three-year basis
performance deteriorated, with 39% of funds in the first or second quartiles
(31 March 2022: 49%).
Over longer periods, the mutual fund performance either improved or remained
broadly stable, with 76% and 67% of mutual funds in the first or second
quartile, on a five- and ten-year basis respectively (31 March 2022: 57% and
70% respectively).
1 Year 3 Year 5 Year 10 Year
First quartile 49% 27% 38% 53%
Second quartile 23% 12% 38% 14%
Third quartile 19% 38% 19% 28%
Fourth quartile 8% 23% 5% 5%
Note: (1) Mutual fund performance and ranking as per Morningstar data using
primary share classes, as defined by Morningstar, net of fees to 31 March
2023. Peer group universes are either Investment Association, Morningstar
Categories or ASISA sectors as classified by Morningstar. Cash or
cash-equivalent funds are excluded from the tables. Mutual fund performance
weighted by AUM. Percentages may not add up to 100% due to rounding.
FINANCIAL REVIEW
Financial results((1))
£ million (unless otherwise stated) Full year 2023 Full year 2022 Change %
Closing AUM (£'bn) 129.3 143.9 (10)
Net flows (£'bn) (10.6) 5.0 n.m.
Average AUM (£'bn) 134.9 138.6 (3)
Management fees 607.7 632.8 (4)
Performance fees 19.4 31.1 (38)
Net revenue 627.1 663.9 (6)
Share of profit from associates 1.4 0.4 n.m.
Other income/(loss) 4.5 (0.4) n.m.
Adjusted operating revenue 633.0 663.9 (5)
Adjusted operating expenses (426.1) (433.5) (2)
Adjusted operating profit 206.9 230.4 (10)
Adjusted net interest income 9.4 3.7 n.m.
Share scheme net (expense)/credit (3.7) 18.1 n.m.
Gain on disposal of Silica - 14.9 n.m.
Profit before tax 212.6 267.1 (20)
Tax expense (48.8) (61.8) (21)
Profit after tax 163.8 205.3 (20)
Average fee rate (basis points, "bps") 45.0 45.7
Adjusted operating profit margin (%) 32.7 34.7
Number of full-time employees 1,208 1,182 2
Note: (1) Please refer to explanations and definitions, including alternative
performance measures, on pages 13 to 16.
Adjusted operating profit decreased 10% to £206.9 million (2022: £230.4
million). The adjusted operating profit margin of 32.7% was lower than the
comparative period (2022: 34.7%), due to the decrease in operating revenue
being greater than the decrease in operating expenses. Profit before tax
decreased 20% to £212.6 million (2022: £267.1 million).
The commentary covers non-IFRS measures to reflect the manner in which
management monitors and assesses the financial performance of Ninety One.
Reconciliations to IFRS equivalent measures are provided in the alternative
performance measures section. Movements discussed as part of the commentary
below apply equally to the movements in equivalent IFRS measures.
Assets under management
Total AUM decreased by 10% to £129.3 billion (31 March 2022: £143.9
billion), reflecting net outflows of £10.6 billion (2022: net inflows of
£5.0 billion) and negative market and foreign exchange movement of £4.0
billion (2022: positive £8.0 billion).
Average AUM decreased 3% to £134.9 billion (2022: £138.6 billion).
Adjusted operating revenue
Management fees decreased 4% to £607.7 million (2022: £632.8 million),
against a 3% decrease in average AUM. The average management fee rate was 0.7
bps lower at 45.0 bps (2022: 45.7bps). This is largely due to a change in the
mix of investment strategies owned by our clients.
Performance fees of £19.4 million were lower compared to levels reported in
the prior year (2022: £31.1 million).
Share of profit from associates increased to £1.4 million (2022: £0.4
million). Other income of £4.5 million (2022: loss of £0.4 million) mostly
consists of foreign exchange gains and operating interest.
Adjusted operating expenses
Adjusted operating expenses decreased by 2% to £426.1 million (2022: £433.5
million), driven largely by a decrease in variable remuneration.
Employee remuneration
Employee remuneration represented 65% (2022: 68%) of the total expense base.
Overall, employee remuneration decreased by 6% to £275.5 million (2022:
£294.4 million). This was driven by lower variable remuneration, in line with
lower adjusted operating profit, partially offset by an increase in fixed
remuneration due to annual inflation and market-related adjustments. Average
headcount over the period increased by 2% to 1,208 (2022: 1,182). The
compensation ratio decreased to 43.5% (2022: 44.3%).
Over 50% of employee remuneration is variable and fluctuates in line with
adjusted operating profit, ensuring alignment with financial performance.
Business expenses
Business expenses increased by 8% to £150.6 million (2022: £139.1 million).
This was driven by higher inflation, foreign exchange fluctuations, one-off
expense increases and the normalisation of expenses following the effects of
COVID-19. The year-on-year split of business expenses remained unchanged from
the prior year and the largest expense item remained client and retail fund
administration.
Adjusted net interest income
Adjusted net interest income increased to £9.4 million (2022: £3.7 million)
following recent increases in interest rates. Adjusted net interest income
excludes interest expense on lease liabilities of £3.6 million (2022: £3.8
million), which has been included in adjusted operating expenses.
Share scheme net expense/credit
The share scheme net expense or credit relates to employees opting to invest a
portion of their deferred bonuses into the Ninety One share scheme. Under
IFRS2, such allocations are amortised over the vesting period. To reflect the
adjusted operating expenses as though all awards during the year were
expensed, the gross allocation value less amortisation charges ("share scheme
net (expense)/credit") is excluded from adjusted operating expenses. The net
expense of £3.7 million (2022: net credit of £18.1 million) largely reflects
the decrease of deferred bonuses awarded as shares in the current year, as a
result of the lower variable remuneration explained above.
Profit before tax
Profit before tax decreased 20% to £212.6 million compared to the prior year
(2022: £267.1 million), which included the profit on the sale of Silica and
the share scheme net expense/ credit, explained above. Adjusted operating
profit decreased 10% to £206.9 million (2022: £230.4 million) and is
reflective of our operating performance.
Effective tax rate
The effective tax rate for the year to 31 March 2023 was 23.0% (2022: 23.1%),
against a headline UK corporation tax rate of 19.0% (2022: 19.0%) and a
headline South Africa corporation tax rate of 27.0% (2022: 28.0%). This
decrease in the South Africa corporation tax rate was mostly offset by a
greater proportion of profit in higher tax jurisdictions.
Earnings per share
£ million (unless stated otherwise) Full year 2023 Full year 2022 Change %
Profit after tax 163.8 205.3 (20)
Gain on disposal of Silica((1)) - (14.9) n.m.
Adjusted net interest income((1)) (9.4) (3.7) n.m.
Share scheme net expense/(credit)((1)) 3.7 (18.1) n.m.
CGT on disposal of subsidiaries((1)) - 4.1 n.m.
Tax on other adjusting items((1)) 1.6 4.5 (64)
Adjusted earnings attributable to shareholders 159.7 177.2 (10)
Weighted average number of ordinary shares (m) - basic 899.6 907.8 (1)
Weighted average number of ordinary shares (m) - diluted 904.8 917.7 (1)
Number of ordinary shares (m) 922.7 922.7 -
Earnings per share (p)
- Basic 18.2 22.6 (19)
- Diluted 18.1 22.4 (19)
Headline earnings per share (p)
- Basic 18.2 21.4 (15)
- Diluted 18.1 21.1 (14)
Adjusted earnings per share (p) 17.3 19.2 (10)
Note: (1) This comprises a component of "non-operating items" per definitions
on page 16. Please refer to explanations and definitions, including
alternative performance measures, on pages 13 to 16.
Basic earnings per share ("Basic EPS") and diluted EPS decreased by 19% to
18.2p and 18.1p respectively (2022: 22.6p and 22.4p). Basic headline EPS
("Basic HEPS") and diluted HEPS also decreased, by 15% to 18.2p and 14% to
18.1p respectively (2022: 21.4p and 21.1p). Adjusted EPS decreased in line
with adjusted operating profit by 10% to 17.3p (2022: 19.2p), which is more
reflective of the core operating performance of Ninety One.
There was no change in the number of shares in issue. The investment in own
shares held by Ninety One as part of the Ninety One share scheme results in
the relatively small difference in the number of shares used to calculate
Basic EPS and Adjusted EPS.
For details on calculations, see note 8 to the condensed consolidated
financial statements.
Summary balance sheet
31 March 2023
£ million Policyholders Shareholders Total IFRS
Non-current assets - 176.0 176.0
Current assets
Linked investments backing policyholder funds 9,962.6 - 9,962.6
Cash and cash equivalents - 379.6 379.6
Other current assets 65.0 229.2 294.2
Total current assets 10,027.6 608.8 10,636.4
Total assets 10,027.6 784.8 10,812.4
Non-current liabilities 24.2 126.0 150.2
Current liabilities
Policyholder investment contract liabilities 9,967.3 - 9,967.3
Other current liabilities 36.1 308.9 345.0
Total current liabilities 10,003.4 308.9 10,312.3
Total liabilities 10,027.6 434.9 10,462.5
Equity - 349.9 349.9
Total equity and liabilities 10,027.6 784.8 10,812.4
31 March 2022
£ million Policyholders Shareholders Total IFRS
Non-current assets - 178.3 178.3
Current assets
Linked investments backing policyholder funds 10,785.9 - 10,785.9
Cash and cash equivalents - 406.6 406.6
Other current assets 66.7 244.6 311.3
Total current assets 10,852.6 651.2 11,503.8
Total assets 10,852.6 829.5 11,682.1
Non-current liabilities 30.0 130.2 160.2
Current liabilities
Policyholder investment contract liabilities 10,769.9 - 10,769.9
Other current liabilities 52.7 357.7 410.4
Total current liabilities 10,822.6 357.7 11,180.3
Total liabilities 10,852.6 487.9 11,340.5
Equity - 341.6 341.6
Total equity and liabilities 10,852.6 829.5 11,682.1
Assets and liabilities
Ninety One undertakes investment-linked insurance business through one of its
South African entities, Ninety One Assurance, and does not take on any
insurance risk in respect of such business. The policyholders hold units in a
pooled portfolio of assets via linked policies issued by the insurance entity.
The assets are beneficially held by the insurance entity and the assets are
reflected on its statement of financial position. Due to the nature of a
linked policy, Ninety One's liability to the policyholders is equal to the
market value of the assets underlying the policies, less applicable taxation.
The movements in policyholder assets are largely due to foreign exchange and
markets. The commentary below only covers the shareholders' numbers.
Total assets decreased to £784.8 million (31 March 2022: £829.5 million),
mainly due to decreases in both cash and cash equivalents and other current
assets. Cash and cash equivalents decreased to £379.6 million (31 March 2022:
£406.6 million) largely due to a fall in subscription bank accounts. Other
current assets decreased to £229.2 million (31 March 2022: £244.6 million)
mainly due to a decrease in investments and fees receivable, in line with
lower assets under management.
Ninety One has a small portfolio of seed investments. Seed capital for mutual
funds was £2.9 million (31 March 2022: £2.7 million) and co-investments in
alternatives totalled £11.0 million (31 March 2022: £6.3 million).
Total liabilities decreased to £434.9 million (31 March 2022: £487.9
million), mainly due to a decrease in subscription creditors and bonus
accruals. There is no debt financing on the balance sheet.
Equity increased to £349.9 million (31 March 2022: £341.6 million), mainly
reflecting the profits for the period net of the payments of the current
period interim dividend and the prior period final dividend, as well as the
impact of share scheme movements and foreign exchange translation differences
in consolidating foreign subsidiaries.
Ninety One has established employee benefit trusts for the purpose of
purchasing shares and satisfying the share-based payment awards granted to
employees. Over the period, 10.0 million shares were purchased through these
trusts and 5.0 million shares were released to employees, resulting in a total
of 22.6 million shares which is 2.4% of Ninety One's 922.7 million total
shares in issue.
Capital and regulatory position((1))
£ million 31 March 2023 31 March 2022
Equity 349.9 341.6
Non-qualifying assets((2)) (35.3) (27.6)
Qualifying capital 314.6 314.0
Dividends proposed (61.7) (71.0)
Estimated regulatory requirement (115.7) (114.2)
Estimated capital surplus 137.2 128.8
Notes:
(1) The above table represents the amalgamated position across Ninety One plc
and its subsidiaries and Ninety One Limited and its subsidiaries, which for
regulatory capital purposes are separate groups. Both groups had an estimated
capital surplus at 31 March 2023 and 31 March 2022.
(2) Non-qualifying assets comprise assets that are not available to meet
regulatory requirements.
The estimated regulatory capital requirement increased slightly to £115.7
million (31 March 2022: £114.2 million). Non-qualifying assets increased
after the inclusion of a pension fund asset arising during the period deemed
non-qualifying. Ninety One has an expected capital surplus of £137.2 million
(31 March 2022: £128.8 million), which is consistent with the commitment to a
capital-light balance sheet. This means Ninety One has a capital coverage of
219% of its capital requirement (31 March 2022: 213%). The capital
requirements for all Ninety One companies are monitored throughout the year.
Dividends
The Board has considered the strength of the balance sheet. In line with the
stated dividend policy, the Board has recommended a final dividend of 6.7p per
share. Of this, 4.3p per share represents 50% of profit after tax prior to the
recognition of non-operating items and 2.4p per share represents after-tax
earnings after ensuring we have sufficient capital to meet current or expected
changes in the regulatory capital requirements and investment needs, as well
as a reasonable buffer to protect against fluctuations in those requirements.
If approved at the AGM, the final dividend will be paid on 11 August 2023 to
shareholders included on the share registers on 21 July 2023 and will result
in a full-year dividend of 13.2p per share (2022: 14.6p).
There are no plans to increase the current number of shares in issue.
Liquidity
Ninety One has a healthy liquidity position, which comprises cash and cash
equivalents of £379.6 million (31 March 2022: £406.6 million). Ninety One
maintains a consistent liquidity management model, with liquidity requirements
monitored carefully against its existing and longer-term obligations. To meet
the daily requirements of the business and to mitigate its credit exposure,
Ninety One diversifies its cash and cash equivalents across a range of
suitably credit-rated corporate banks and money market funds.
Alternative performance measures
Ninety One uses non-IFRS measures to reflect the manner in which management
monitors and assesses the financial performance of Ninety One.
Items are included or excluded from adjusted operating revenue and expenses
based on management's assessment of whether they contribute to the core
operations of the business. In particular:
· share of profit from associates, as well as net gain on investments and
other income, are included in other operating revenue as, other than movements
in investments related to deferred employee benefit schemes and excluded as
noted below, these items are directly attributable to operations;
· deferred employee benefit scheme movements are deducted from adjusted
operating revenue and adjusted operating expenses as the movements offset and
do not impact operating performance;
· subletting income is excluded from adjusted operating revenue and
deducted from adjusted operating expenses as it is a recovery of costs rather
than a core revenue item;
· the share scheme net expense/credit is excluded from adjusted
operating expenses and employee remuneration so that they reflect the position
as though all awards during the period were fully expensed in the same period;
and
· interest expense on lease liabilities is included in adjusted
operating expenses to reflect the operating costs of offices.
These non-IFRS measures are considered additional disclosures and in no case
are intended to replace the financial information prepared in accordance with
the basis of preparation detailed in the condensed consolidated financial
statements. Moreover, the way in which Ninety One defines and calculates these
measures may differ from the way in which these or similar measures are
calculated by other entities. Accordingly, they may not be comparable to
measures used by other entities in Ninety One's industry.
These non-IFRS measures are considered to be pro forma financial information
for the purpose of the JSE Listings Requirements, have been compiled for
illustrative purposes only, and are the responsibility of Ninety One's Board.
Due to their nature, they may not fairly present the issuer's financial
position, changes in equity, results of operations or cash flows. The non-IFRS
financial information has been prepared with reference to JSE Guidance Letter:
Presentation of pro forma financial information dated 4 March 2010 and in
accordance with paragraphs 8.15 to 8.33 in the JSE Listings Requirements, the
Revised SAICA Guide on Pro forma Financial Information (issued September 2014)
and International Standard on Assurance Engagement ("ISAE") 3420 -Assurance
Engagements to Report on the Compilation of Pro forma Financial Information
included in a Prospectus, to the extent applicable given the Non-IFRS
Financial Information's nature. This pro forma financial information has been
reported on by PwC in terms of ISAE 3420 and their unmodified report is
available for inspection on the Ninety One website (www.ninetyone.com).
These non-IFRS measures, including reconciliations to their nearest condensed
consolidated financial statements equivalents, are as follows:
£ million Full year 2023 Full year 2022
Net revenue 627.1 663.9
Share of profit from associates 1.4 0.4
Net gain on investments and other income 7.0 4.3
Adjusted for:
Deferred employee benefit scheme gain (1.3) (3.4)
Subletting income (1.2) (1.3)
Adjusted operating revenue 633.0 663.9
£ million Full year 2023 Full year 2022
Operating expenses 428.7 416.3
Adjusted for:
Share scheme net (expense)/credit (3.7) 18.1
Deferred employee benefit scheme gain (1.3) (3.4)
Subletting income (1.2) (1.3)
Interest expense on lease liabilities 3.6 3.8
Adjusted operating expenses 426.1 433.5
£ million Full year 2023 Full year 2022
Staff expenses 279.2 276.3
Adjusted for:
Share scheme net (expense)/credit (3.7) 18.1
Employee remuneration 275.5 294.4
£ million Full year 2023 Full year 2022
Adjusted operating revenue 633.0 663.9
Adjusted operating expenses (426.1) (433.5)
Adjusted operating profit 206.9 230.4
Adjusted operating profit margin 32.7% 34.7%
£ million Full year 2023 Full year 2022
Net interest income/(expense) 5.8 (0.1)
Adjusted for:
Interest expense on lease liabilities 3.6 3.8
Adjusted net interest income 9.4 3.7
Foreign currency
The financial information is prepared in British pound sterling. The results
of operations and the financial condition of individual companies are reported
in the local currencies of the countries in which they are domiciled,
including South African rand and US dollar. These results are then translated
into pounds sterling at the applicable foreign currency exchange rates for
inclusion in the condensed consolidated financial statements. The following
table sets out the movement in the relevant exchange rates against pounds
sterling for the twelve months ended 31 March 2023 and 2022.
31 March 2023 31 March 2022
Year end Average Year end Average
South African rand 22.10 20.46 19.03 20.29
US dollar 1.24 1.21 1.31 1.37
DEFINITIONS
Adjusted earnings attributable to shareholders: Calculated as profit after tax
adjusted to remove non-operating items
Adjusted earnings per share (Adjusted EPS): Adjusted earnings attributable to
shareholders divided by the number of ordinary shares in issue at the end of
the period
Adjusted net interest income: Calculated as net interest income or expense
adjusted to exclude interest expense on lease liabilities for office premises
Adjusted operating expenses: Calculated as operating expenses adjusted to
exclude share scheme movements and deferred employee benefit scheme movements,
but adjusted to include subletting income and interest expense on lease
liabilities
Adjusted operating profit: Calculated as adjusted operating revenue less
adjusted operating expenses
Adjusted operating profit margin: Calculated as adjusted operating profit
divided by adjusted operating revenue
Adjusted operating revenue: Calculated as net revenue adjusted to include
share of profit from associates, net gain/loss on investments and other
income, but adjusted to exclude deferred employee benefit scheme movements and
subletting income
Assets under management (AUM): The aggregate assets managed on behalf of
clients. For some private markets' investments, the aggregate value of assets
managed is based on committed funds by clients; this is changed to the lower
of committed funds and net asset value, in line with the fee basis. Where
cross investment occurs, assets and flows are identified, and the duplication
is removed
Average AUM: Calculated as the average of opening AUM for the year, and the
month end AUM for each of the subsequent 12 months
Average exchange rate: Calculated as the average of the daily closing spot
exchange rates in the relevant period
Average fee rate: Management fees divided by average AUM (annualised for
non-twelve month periods), expressed in basis points
Basic earnings per share (Basic EPS): Profit attributable to shareholders
divided by the weighted average number of ordinary shares outstanding during
the period, excluding own shares held by Ninety One share schemes
Compensation ratio: Calculated as employee remuneration divided by adjusted
operating revenue
Diluted earnings per share (Diluted EPS): Profit for the period attributable
to shareholders divided by the weighted average number of ordinary shares
outstanding during the period, plus the weighted average number of ordinary
shares that would be issued on the conversion of all the potentially dilutive
shares into ordinary shares
Employee remuneration: Calculated as staff expenses adjusted for share scheme
movements
Headline earnings per share (HEPS): Ninety One is required to calculate HEPS
in accordance with JSE Listings Requirements, determined by reference to
circular 1/2021 "Headline Earnings" issued by the South African Institute of
Chartered Accountants
JSE: Johannesburg Stock Exchange, the exchange operated by the JSE Limited, a
public company incorporated and registered in South Africa, licensed under the
Financial Markets Act
LSE: London Stock Exchange, the securities exchange operated by the London
Stock Exchange plc under the Financial Services and Markets Act 2000, as
amended
Management fees: Recurring fees net of commission expense
Net flows: The increase in AUM received from clients, less the decrease in AUM
withdrawn by clients, during a given period. Where cross investment occurs,
assets and flows are identified, and the duplication is removed
Net revenue: Represents revenue in accordance with IFRS, less commission
expense
Non-operating items: Include gains or losses on disposal of subsidiaries,
adjusted net interest income, share scheme movements, and tax on adjusting
items
Review report
The condensed consolidated financial statements, which comprise the condensed
consolidated statement of financial position at 31 March 2023 and the
condensed consolidated statement of comprehensive income, the condensed
consolidated statement of changes in equity and the condensed consolidated
statement of cash flows for the year then ended and the notes to such
condensed consolidated financial statements, and the annexure to the condensed
consolidated financial statements, have been reviewed by
PricewaterhouseCoopers Inc., in accordance with the requirements of the JSE
Limited Listings Requirements, as set out in note 1 to the condensed
consolidated financial statements, and the requirements of the Companies Act
of South Africa, who expressed an unmodified review conclusion. The auditor's
report does not necessarily report on all of the information contained in
these financial results. Shareholders are therefore advised that in order to
obtain a full understanding of the nature of the auditor's engagement, they
should obtain a copy of the auditor's report together with the accompanying
financial information from Ninety One's website or its registered office.
Preparation of condensed consolidated financial statements
These condensed consolidated financial statements have been prepared by
management under the supervision of the Finance Director, Kim McFarland
CA(SA). The board of directors take full responsibility for the preparation of
the condensed consolidated financial statements.
On behalf of the board of directors
Hendrik du Toit
Kim McFarland
Chief Executive Officer Finance
Director
16 May 2023
16 May 2023
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 March 2023
2023 2022(1)
£'m £'m
Notes (Reviewed) (Reviewed)
Revenue 2 745.5 795.1
Commission expense (118.4) (131.2)
Net revenue 627.1 663.9
Operating expenses 3 (428.7) (416.3)
Share of profit from associates 1.4 0.4
Net gain on investments and other income 4 7.0 4.3
Operating profit 206.8 252.3
Interest income 5 9.6 3.9
Interest expense 5 (3.8) (4.0)
Gain on disposal of subsidiaries 6 - 14.9
Profit before tax 212.6 267.1
Tax expense 7 (48.8) (61.8)
Profit after tax 163.8 205.3
Other comprehensive (loss)/income
Items that will not be reclassified to profit or loss:
Net remeasurements on pension fund asset/obligation 2.8 0.5
Tax effect of items that will not be reclassified to profit or loss (0.7) 1.3
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign subsidiaries (16.0) 9.1
Exchange differences transferred to profit or loss - 0.3
Other comprehensive (loss)/income for the year (13.9) 11.2
Total comprehensive income for the year 149.9 216.5
Earnings per share (pence)
Basic 8(a) 18.2 22.6
Diluted 8(a) 18.1 22.4
(1) "Profit before tax and exceptional items" and the heading "Exceptional
items" have been removed from the prior period.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
At 31 March 2023
2023 2022
£'m £'m
Notes (Reviewed) (Reviewed)
(Restated)
Assets
Investments(1) 10 43.5 36.3
Investment in associates 1.3 0.9
Property and equipment 23.0 26.6
Right-of-use assets 11 76.7 83.1
Deferred tax assets 25.5 28.1
Other receivables 3.4 3.3
Pension fund asset 2.6 -
Total non-current assets 176.0 178.3
Investments(1) 10 24.4 34.8
Linked investments backing policyholder funds 12 9,962.6 10,785.9
Income tax recoverable 9.2 10.4
Trade and other receivables 260.6 266.1
Cash and cash equivalents 13 379.6 406.6
Total current assets 10,636.4 11,503.8
Total assets 10,812.4 11,682.1
Liabilities
Other liabilities 14 33.7 30.2
Lease liabilities 11 92.2 99.5
Pension fund obligation - 0.1
Deferred tax liabilities 24.3 30.4
Total non-current liabilities 150.2 160.2
Policyholder investment contract liabilities 12 9,967.3 10,769.9
Other liabilities 14 21.9 34.9
Lease liabilities 11 10.5 9.9
Trade and other payables 15 302.2 354.4
Income tax payable 10.4 11.2
Total current liabilities 10,312.3 11,180.3
Equity
Share capital 16(a) 441.2 441.2
Demerger reserves (re-presented) 16(b) (321.3) (321.3)
Own share reserve 16(c) (51.4) (35.7)
Other reserves (re-presented) 16(b) (6.6) 4.0
Retained earnings 287.9 253.3
Shareholders' equity excluding non-controlling interests 349.8 341.5
Non-controlling interests 0.1 0.1
Total equity 349.9 341.6
Total equity and liabilities 10,812.4 11,682.1
(1) The comparative amounts have been restated to reclassify a portion of
deferred compensation investments from current assets to non-current assets.
Accordingly, the prior year numbers for current investments changed from
£61.9 million to £34.8 million and non-current investments changed from
£9.2 million to £36.3 million. The purpose of this change is to better
reflect the timing of the realisation of the investments.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 March 2023
Attributable to shareholders of parent companies
Share capital Demerger reserves Own share reserve Other reserves Retained earnings Total Non-controlling interests Total equity
(re-presented)(1)
(re-presented)(1)
Notes £'m £'m £'m £'m £'m £'m £'m £'m
2023 (Reviewed)
At 1 April 2022 441.2 (321.3) (35.7) 4.0 253.3 341.5 0.1 341.6
Profit for the year - - - - 163.8 163.8 - 163.8
Other comprehensive loss - - - (16.0) 2.1 (13.9) - (13.9)
Total comprehensive income - - - (16.0) 165.9 149.9 - 149.9
Transactions with shareholders
Share-based payment charges related to Ninety One share scheme 16(b) - - - 14.2 - 14.2 - 14.2
Deferred tax - - - - (1.1) (1.1) - (1.1)
Own shares purchased 16(c) - - (23.8) - - (23.8) - (23.8)
Vesting and release of share awards 16(b),(c) - - 8.1 (8.8) - (0.7) - (0.7)
Dividends paid 9 - - - - (130.2) (130.2) - (130.2)
Total transactions with shareholders - - (15.7) 5.4 (131.3) (141.6) - (141.6)
At 31 March 2023 441.2 (321.3) (51.4) (6.6) 287.9 349.8 0.1 349.9
2022 (Reviewed)
At 1 April 2021 441.2 (321.3) (19.5) (17.1) 169.9 253.2 0.1 253.3
Profit for the year - - - - 205.3 205.3 - 205.3
Other comprehensive income - - - 9.4 1.8 11.2 - 11.2
Total comprehensive income - - - 9.4 207.1 216.5 - 216.5
Transactions with shareholders
Share-based payment charges related to Ninety One share scheme 16(b) - - - 12.1 - 12.1 - 12.1
Own shares purchased 16(c) - - (16.7) - - (16.7) - (16.7)
Vesting and release of share awards 16(b),(c) - - 0.5 (0.4) - 0.1 - 0.1
Dividends paid 9 - - - - (123.7) (123.7) - (123.7)
Total transactions with shareholders - - (16.2) 11.7 (123.7) (128.2) - (128.2)
At 31 March 2022 441.2 (321.3) (35.7) 4.0 253.3 341.5 0.1 341.6
(1) Refer to note 16(b) for detail on re-presentation of other reserves.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 March 2023
2023 2022
£'m £'m
(Reviewed) (Reviewed)
Notes (Restated)
Cash flows from operations - shareholders 18(a) 191.9 241.5
Cash flows from operations - policyholders(1) 18(a) (69.8) 58.0
Cash flows from operations(1) 122.1 299.5
Interest received 5 9.6 3.9
Interest paid in respect of lease liabilities 18(b) (3.6) (1.7)
Other interest paid 5 (0.2) (0.2)
Contributions to pension fund (0.1) (0.2)
Dividends received from associates(1) 1.0 0.7
Income tax paid (54.2) (69.7)
Net cash flows from operating activities(1) 74.6 232.3
Cash flows from investing activities
Net disposal of investments 2.7 12.9
Distributions from investments 0.9 -
Disposal of subsidiaries, net of cash disposed - 17.7
Additions to property and equipment (1.2) (1.4)
Net cash flows from investing activities(1) 2.4 29.2
Cash flows from financing activities
Principal elements of lease payments 18(b) (10.3) (5.3)
Purchase of own shares 16(c) (23.8) (16.7)
Dividends paid 9 (130.2) (123.7)
Net cash flows from financing activities (164.3) (145.7)
Cash and cash equivalents at 1 April 570.3 447.0
Net change in cash and cash equivalents (87.3) 115.8
Effect of foreign exchange rate changes (32.1) 7.5
Cash and cash equivalents at 31 March 450.9 570.3
Cash and cash equivalents at 31 March consist of:
Cash and cash equivalents available for use by the Group 13 379.6 406.6
Cash and cash equivalents presented within other assets
Cash and cash equivalents presented within linked investments backing 12 71.3 163.7
policyholder funds
Cash and cash equivalents at 31 March 450.9 570.3
(1) The comparative amounts have been restated to reflect the
reclassification of net acquisition of linked investments backing policyholder
funds and dividends received from associates, from investing activities to
operating activities.
Accordingly, the prior year numbers have been amended as follows:
· net cash flows from investing activities has changed from net
outflow of £393.1 million to net inflow of £29.2 million,
· cash flows from operations - policyholders has changed from net
inflow of £481.0 million to net inflow of £58.0 million, and
· net cash flows from operating activities has changed from net
inflow of £654.6 million to net inflow of £232.3 million.
These changes are considered to improve the consistency of the classification
of cash flows related to policyholders and associates, and to align the
presentation with other sections of the results announcement.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 March 2023
General information
Ninety One operates as a dual-listed company ("DLC") under a DLC structure.
The DLC structure comprises Ninety One plc, a public company incorporated in
England and Wales under the UK Companies Act 2006 and Ninety One Limited, a
public company incorporated in South Africa under the South African Companies
Act 71 of 2008. Under the DLC structure, Ninety One plc and Ninety One
Limited, together with their direct and indirect subsidiaries, effectively
form a single economic enterprise (the "Group") in which the economic and
voting rights of ordinary shareholders of the companies are maintained in
equilibrium relative to each other. The Group is listed on the London and
Johannesburg Stock Exchanges.
1 Basis of preparation
The condensed consolidated financial statements for the year ended 31 March
2023 have been prepared in accordance with:
- the JSE Limited's Listings Requirements and the requirements of the
Companies Act of South Africa;
- UK-adopted international accounting standards and with International
Financial Reporting Standards as issued by the International Accounting
Standards Board ("IASB") (collectively "IFRS") which, as they apply to the
condensed consolidated financial statements, are identical in all material
respects;
- the SAICA Financial Reporting Guides as issued by the Accounting
Practices Committee and Financial Pronouncements as issued by the Financial
Reporting Standards Council and to also, as a minimum, contain the information
required by IAS 34 Interim Financial Reporting;
- the accounting policies and significant judgements and estimates
applied to the Group's consolidated financial statements for the year ended 31
March 2022; and
- the requirements in UK Listing Rule R 9.7A with regards the preparation
of preliminary statements of annual results.
The condensed consolidated financial statements have been prepared on the
historical cost basis with the exception of linked investments backing
policyholder funds, policyholder investment contract liabilities, investments,
money market funds within cash and cash equivalents, other liabilities and the
pension fund asset/obligation which have been presented on a fair value basis.
During the year ended 31 March 2023, the measurement classification of money
market funds changed from amortised cost to fair value through profit or loss
("FVTPL") as the Group has assessed FVTPL to be a more appropriate
measurement. However there has been no change to the comparative figure in the
condensed consolidated statement of financial position as amortised cost
approximated to fair value. Note 17 has been restated to include money market
funds in the fair value hierarchy.
The presentation currency of the Group is pounds sterling ("£"), being the
functional currency of Ninety One plc. The functional currency of Ninety One
Limited is South African rand. All values are rounded to the nearest million
("£'m"), unless otherwise indicated.
Foreign operations are subsidiaries and interests in associated undertakings
of the Group, the activities of which are based in a functional currency other
than that of the reporting entity. The functional currency of an entity is
determined based on the primary economic environment in which the entity
operates. Foreign currency transactions are translated into the functional
currency of the entity in which the transactions arise, based on rates of
exchange ruling at the date of the transactions.
This provisional announcement does not constitute the Group's full
consolidated financial statements for the year ended 31 March 2023. The
Group's full consolidated financial statements will be approved by the board
of directors, reported on by the auditors and published in June 2023.
Accordingly, the financial information for the year ended 31 March 2023 is
presented unaudited in this preliminary announcement to satisfy UK reporting
requirements and is presented as reviewed in this provisional announcement to
satisfy the JSE Limited Listings Requirements in South Africa.
The preliminary announcement also does not constitute Ninety One plc's
statutory accounts in the UK for the years ended 31 March 2023 or 2022. The
financial information for 2022 is derived from the UK statutory accounts for
2022 which have been delivered to the UK's registrar of companies. The
auditor has reported on the 2022 accounts; their report was (i) unqualified,
(ii) did not include a reference to any matters to which the auditor drew
attention by way of emphasis without qualifying their report and (iii) did not
contain a statement under section 498 (2) or (3) of the Companies Act 2006.
The UK statutory accounts for 2023 will be finalised on the basis of the
financial information presented by the Board of Directors in this preliminary
announcement and will be delivered to the UK's registrar of companies in due
course.
Going concern
The Board of Directors have considered the resilience of the Group and taking
into account its current financial position and the principal and emerging
risks facing the business, including the impacts of climate change, current
events and market conditions have had on the Group's financial performance and
outlook. The Board of Directors has performed a going concern assessment by
applying various stressed scenarios, including severe but plausible downside
assumptions, about the impact on assets under management, profitability of the
Group and known commitments. All scenarios show that the Group would maintain
sufficient resources to enable it to continue operating profitably for a
period of at least 12 months from the date of the release of these results.
The condensed consolidated financial statements have therefore been prepared
on a going concern basis.
2 Segmental reporting
Revenue primarily consists of management fees and performance fees derived
from investment management activities. As an integrated global investment
manager, the Group operates a single-segment investment management business.
All financial, business and strategic decisions are made centrally by the
chief operating decision maker (the "CODM") of the Group. The CODM is the
chief executive officer of the Group from time to time. Reporting provided to
the CODM is on an aggregated basis which is used for evaluating the Group's
performance and the allocation of resources. The CODM monitors operating
profit for the purpose of making decisions about resource allocation and
performance assessment. Given that only one segment exists, no additional
information is presented in relation to it, as it is disclosed throughout the
condensed consolidated financial statements. Revenue is disaggregated by
geographic location of contractual entities, as this best depicts how the
nature, amount, timing and uncertainty of the Group's revenue and cash flows
are affected by economic factors. Revenue is generated from a diversified
customer base and the Group has no single customer that it relies on.
Non-current assets other than financial instruments and deferred tax assets
are allocated based on where the assets are physically located.
2023 2022
Revenue from external clients £'m £'m
United Kingdom 499.7 554.4
South Africa 160.4 167.5
Rest of the world 85.4 73.2
745.5 795.1
Performance fees included in revenue above 19.4 31.1
Non-current assets
United Kingdom 73.3 80.8
South Africa 3.4 5.9
Rest of the world 24.3 23.9
101.0 110.6
2023 2022
3 Operating expenses by nature Notes £'m £'m
Staff expenses 3(a) 279.2 276.3
Deferred employee benefit scheme gain 1.3 3.4
Depreciation of right-of-use assets 18(a) 9.9 9.7
Depreciation of property and equipment 18(a) 4.9 5.3
Auditors' remuneration 1.9 1.8
Other administrative expenses 131.5 119.8
428.7 416.3
The largest component of other administrative expenses is client and retail
fund administration.
2023 2022
3(a) Staff expenses £'m £'m
Salaries, wages and other related expenses 236.8 235.3
Share-based payment expenses related to Investec share plans 0.3 0.6
Share-based payment expenses related to Ninety One share scheme 14.2 12.1
Social security costs 17.8 19.0
Pension costs 10.1 9.3
279.2 276.3
2023 2022
4 Net gain on investments and other income Notes £'m £'m
Deferred employee benefit scheme gain 1.3 3.4
Loss on other investments (0.3) (2.2)
Net gain on investments 18(a) 1.0 1.2
Foreign exchange gain 1.1 1.2
Subletting income 1.2 1.3
Other income 3.7 0.6
7.0 4.3
2023 2022
5 Interest income/(expense) Notes £'m £'m
Interest income from financial assets measured at amortised cost 2.5 1.1
Interest income from money market funds 7.1 2.8
Interest income 9.6 3.9
Interest expense on lease liabilities 18(b) (3.6) (3.8)
Other interest expense (0.2) (0.2)
Interest expense (3.8) (4.0)
Net interest income/(expense) 18(a) 5.8 (0.1)
6 Gain on disposal of subsidiaries
Details of the gain on disposal of Silica are set out in the Group's
integrated Annual Report 2022.
2023 2022
7 Tax expense £'m £'m
Current tax - current year 49.9 62.5
Current tax - adjustment for prior years 0.1 0.3
Current tax expense 50.0 62.8
Deferred tax - current year 0.3 1.0
Deferred tax - adjustment for prior years (0.3) 0.2
Deferred tax - change in corporate tax rate (1.2) (2.2)
Deferred tax credit (1.2) (1.0)
48.8 61.8
The UK corporation tax rate for 2023 was 19% (2022: 19%). An increase in the
UK corporation tax rate to 25% from 1 April 2023 was announced by the UK
Government in the Spring Budget 2020. This rate was substantively enacted in
May 2021. Deferred tax balances in the UK at 31 March 2023 were therefore
revalued using these substantively enacted tax rates accordingly.
The tax charge in the year is higher (2022: higher) than the standard rate of
corporate tax in the UK and the differences are explained below:
2023 2022
Reconciliation of effective tax rate % %
Effective rate of taxation 23.0 23.1
Tax effect of non-deductible expenses (0.4) (0.2)
Effect on deferred tax balances resulting from a change in tax rates 0.6 0.7
Adjustment to tax charge in respect of prior year 0.1 -
Tax on gain on disposal of subsidiaries - (0.5)
Effect of different tax rates applicable in foreign jurisdictions (4.3) (4.1)
United Kingdom standard tax rate 19.0 19.0
8 Earnings per share
The Group calculates earnings per share ("EPS") on a number of different bases
in accordance with IFRS and prevailing South African requirements.
8(a) Basic and diluted earnings per share
The calculations of basic and diluted EPS are based on IAS 33 Earnings Per
Share.
Basic EPS is calculated by dividing profit attributable to shareholders by the
weighted average number of ordinary shares outstanding during the year,
excluding own shares held by the Ninety One Employee Benefit Trusts ("EBTs").
Diluted EPS is calculated by dividing the profit attributable to shareholders
by the weighted average number of ordinary shares outstanding during the year,
plus the weighted average number of ordinary shares that would be issued on
the conversion of all the potentially dilutive shares into ordinary shares.
2023 2022
£'m £'m
Profit attributable to shareholders 163.8 205.3
The calculation of the weighted average number of ordinary shares for the
purpose of calculating basic and diluted earnings per share is:
Number of shares Number of shares
Millions Millions
Weighted average number of ordinary shares for the purpose of calculating 899.6 907.8
basic EPS
Effect of dilutive potential shares - share awards 5.2 9.9
Weighted average number of ordinary shares for the purpose of calculating 904.8 917.7
diluted EPS
Basic EPS (pence) 18.2 22.6
Diluted EPS (pence) 18.1 22.4
8(b) Headline earnings and diluted headline earnings per share
The Group is required to calculate headline earnings per share ("HEPS") in
accordance with the JSE Listings Requirements, determined by reference to
circular 1/2021 "Headline Earnings" issued by the South African Institute of
Chartered Accountants.
The table below reconciles the profits attributable to shareholders to
headline earnings and summarises the calculation of basic and diluted HEPS:
2023 2022
£'m £'m
Profit attributable to shareholders 163.8 205.3
Share of profit from associates - (0.4)
Gain on disposal of subsidiaries - (14.9)
Tax impact on adjusting items - 4.1
Headline earnings 163.8 194.1
Number of shares Number of shares
Millions Millions
Weighted average number of ordinary shares for the purpose of calculating 899.6 907.8
basic EPS (note 8(a))
Weighted average number of ordinary shares for the purpose of calculating 904.8 917.7
diluted EPS (note 8(a))
HEPS (pence) 18.2 21.4
Diluted HEPS (pence) 18.1 21.1
2023 2022
9 Dividends Pence per share £'m Pence per share £'m
Prior year's final dividend paid 7.7 70.5 6.7 60.8
Interim dividend paid 6.5 59.7 6.9 62.9
Total dividends attributable to shareholders 14.2 130.2 13.6 123.7
On 16 May 2023, the Board recommended a final dividend for the year ended 31
March 2023 of 6.7 pence per ordinary share, an estimated £61.7 million in
total. The dividend is expected to be paid on 11 August 2023 to ordinary
shareholders on the registers at the close of business on 21 July 2023.
2023 2022
10 Investments £'m £'m
Non-current
Investments in unlisted investment vehicles 8.0 3.5
Deferred compensation investments 31.4 27.1
Other investments 4.1 5.7
43.5 36.3
Current
Deferred compensation investments 21.5 32.1
Seed investments 2.9 2.7
24.4 34.8
11 Leases
2023 2022
£'m £'m
Right-of-use assets
Office premises 76.7 83.1
Additions to right-of-use assets during the year ended 31 March 2023 were
£2.6 million (2022: £2.4 million).
Lease liabilities
Current 10.5 9.9
Non-current 92.2 99.5
102.7 109.4
The calculation of leased assets and liabilities requires the use of both
estimation and judgement. The determination of the lease term for each lease
involves the Group's judgement on the likelihood of any extension and
termination options being exercised. The Group considers all facts and
circumstances around the extension and termination options, including the
enforceability of such options and the economic incentive created for the
Group to exercise such options. Several of the Group's leases contain such
clauses. For each lease, a conclusion was reached on the overall likelihood of
the option being exercised. Such options are only included in the lease term
if the lease is reasonably certain to be extended or terminated by the Group.
In addition, the identification of an appropriate discount rate to use in the
calculation of the lease liability involved estimation. Where the lease's
implicit rate is not readily determinable, an incremental borrowing rate,
being the rate that that the individual lease would have to pay to borrow the
funds necessary to obtain an asset of similar value to the right-of-use asset
in a similar economic environment with similar terms and conditions, must be
calculated by the Group.
The remaining contractual maturities of the Group's lease liabilities at the
end of the current reporting period were:
2023 2022
Present value of the minimum lease payments Total minimum lease payments Present value of the minimum lease payments Total minimum lease payments
£'m £'m £'m £'m
Within one year 10.5 13.7 9.9 13.4
Between one and five years 36.6 46.1 36.6 47.0
Over five years 55.6 61.2 62.9 70.4
102.7 121.0 109.4 130.8
The total cash outflow for leases during the year ended 31 March 2023 was
£13.9 million (2022: £7.0 million).
12 Policyholders' assets and liabilities
2023 2022
Linked investments backing policyholder funds £'m £'m
Quoted investments at fair value
Equities 801.7 1,064.5
Derivatives (1.2) 10.7
800.5 1,075.2
Unquoted investments at fair value
Collective investment schemes 6,529.0 6,690.9
Equities - 0.5
Interest-bearing stocks, debentures and other loans(1) 2,554.5 2,849.8
Derivatives 7.3 5.8
Cash and cash equivalents 71.3 163.7
9,162.1 9,710.7
9,962.6 10,785.9
(1) The comparative amount for interest-bearing stocks, debentures and other
loans of £1,897.8 million was reclassified from quoted to unquoted
investments. The change is to correctly reflect the nature of these
investments.
The movements in linked investments backing policyholder funds were:
2023 2022
Notes £'m £'m
At 1 April 10,785.9 9,063.9
Net fair value gains on linked investments backing policyholder funds 18(a) 359.0 478.5
Net acquisition of linked investments backing policyholder funds 18(a) 444.3 423.0
Net movement in cash and cash equivalents within linked investments backing (92.4) 57.7
policyholder funds
Foreign exchange adjustment (1,534.2) 762.8
At 31 March 9,962.6 10,785.9
Policyholder investment contract liabilities
The movements in policyholder investment contract liabilities were:
2023 2022
Notes £'m £'m
At 1 April 10,769.9 9,033.6
Investment income on linked investments backing policyholder funds 462.6 366.8
Net fair value gains on linked investments backing policyholder funds 359.0 478.5
Investment and administration expenses (40.8) (35.0)
Income tax expense - policyholders' funds (2.7) (4.6)
Surplus transferred to shareholders (37.1) (33.1)
Net fair value change on policyholder investment contract liabilities 18(a) 741.0 772.6
Net contributions 18(a) 6.9 202.1
Foreign exchange adjustment (1,550.5) 761.6
At 31 March 9,967.3 10,769.9
2023 2022
13 Cash and cash equivalents £'m £'m
Cash at bank 99.5 265.3
Money market funds 280.1 141.3
379.6 406.6
Cash balances within linked investments backing policyholder funds of £71.3
million (2022: £163.7 million) as set out in note 12 are not included as they
are not available for use by the Group.
2023 2022
14 Other liabilities £'m £'m
Non-current
Deferred compensation liabilities 31.9 28.6
Other liabilities 1.8 1.6
33.7 30.2
Current
Deferred compensation liabilities 21.9 34.9
55.6 65.1
Deferred compensation liabilities include applicable employer tax.
2023 2022
15 Trade and other payables £'m £'m
Employee related payables 144.9 165.3
Trade payables 157.3 189.1
302.2 354.4
16 Share capital and reserves
16(a) Share capital
Ninety One plc Number of shares Nominal
Millions
value
£'m
Ordinary shares of £0.0001 each, issued, allotted and fully paid 622.6 0.1
Special shares of £0.0001 each, issued, allotted and fully paid:
Special converting shares 300.1 -
UK DAS share * -
UK DAN share * -
Special voting share * -
Special rights share * -
Ninety One plc balance at 31 March 2023 and 2022 0.1
Ninety One Limited
Ordinary shares with no par value, issued, allotted and fully paid 300.1 441.1
Special shares with no par value, issued, allotted and fully paid:
Special converting shares 622.6 -
SA DAS share * -
SA DAN share * -
Special voting share * -
Special rights share * -
Ninety One Limited balance at 31 March 2023 and 2022 441.1
Total ordinary shares in issue and share capital at 31 March 2023 and 2022 922.7 441.2
* Represents one share
16(b) Demerger reserves and other reserves
In the prior year, demerger reserves and other reserves were presented
together as "Other reserves". They have been separately presented in the
current year and the comparatives have been re-presented accordingly. The
change is considered to improve the clarity of the presentation to distinguish
between the reserves arising during the demerger from Investec and other
reserves.
Demerger reserves
The Group was demerged from Investec in March 2020 and reserves were created
during the demerger process as below:
£'m
Distributable reserve 732.2
Merger reserve 183.0
DLC reserve (1,236.5)
Balance at 31 March 2023 and 2022 (321.3)
Other reserves
The movements in other reserves during the year were:
Share-based payments reserve Foreign currency translation reserve Total
2023 £'m £'m £'m
At 1 April 24.2 (20.2) 4.0
Exchange differences on translation of foreign subsidiaries - (16.0) (16.0)
Share-based payment charges 14.2 - 14.2
Vesting and release of share awards (8.8) - (8.8)
At 31 March 29.6 (36.2) (6.6)
2022
At 1 April 12.5 (29.6) (17.1)
Exchange differences on translation of foreign subsidiaries - 9.1 9.1
Exchange differences transferred to profit or loss - 0.3 0.3
Share-based payment charges 12.1 - 12.1
Vesting and release of share awards (0.4) - (0.4)
At 31 March 24.2 (20.2) 4.0
16(c) Own share reserve
The Group established the EBTs for the purpose of purchasing the Group's
shares and satisfying the share-based payment awards granted to employees.
Movements in the own shares reserve during the year were:
2023 2022
Number of shares Millions £'m Number of shares Millions £'m
At 1 April 17.6 35.7 11.0 19.5
Own shares purchased 10.0 23.8 6.8 16.7
Own shares vested and released (5.0) (8.1) (0.2) (0.5)
At 31 March 22.6 51.4 17.6 35.7
17 Fair value of financial instruments
The fair values of all financial instruments are substantially similar to
carrying values reflected in the condensed consolidated statement of financial
position as they are short-term in nature, subject to variable, market-related
interest rates or stated at fair value in the condensed consolidated statement
of financial position. The Group measures fair values using the following fair
value hierarchy that reflects the significance of the inputs used in making
the measurements:
Level 1: Quoted market price (unadjusted) in an active market for an identical
instrument.
Level 2: Valuation techniques based on observable inputs, either directly
(i.e. as prices) or indirectly (i.e. derived from prices). The category
includes instruments valued using quoted market prices in active markets for
similar instruments, quoted prices for identical or similar instruments in
markets that are considered less than active or other valuation techniques
where all significant inputs are directly or indirectly observable from market
data.
Level 3: Valuation techniques where one or more significant inputs are
unobservable.
Financial instruments measured at fair value at the end of the reporting
period by the level in the fair value hierarchy were:
Level 1 Level 2 Level 3 Total
2023 Notes £'m £'m £'m £'m
Deferred compensation investments 10 52.9 - - 52.9
Seed investments 10 2.9 - - 2.9
Unlisted investment vehicles 10 - - 8.0 8.0
Other investments 10 - 4.1 - 4.1
Money market funds(1) 13 280.1 - - 280.1
Investments backing policyholder funds 12 800.5 9,116.2 45.9 9,962.6
Total financial assets measured at fair value 1,136.4 9,120.3 53.9 10,310.6
Policyholder investment contract liabilities 12 (800.5) (9,120.9) (45.9) (9,967.3)
Other liabilities 14 (55.6) - - (55.6)
Total financial liabilities measured at fair value (856.1) (9,120.9) (45.9) (10,022.9)
2022 (Restated)
Deferred compensation investments 10 59.2 - - 59.2
Seed investments 10 2.7 - - 2.7
Unlisted investment vehicles 10 - - 3.5 3.5
Other investments 10 - 5.7 - 5.7
Money market funds(1) 13 141.3 - - 141.3
Investments backing policyholder funds(2) 12 1,075.2 9,646.8 63.9 10,785.9
Total financial assets measured at fair value(1,2) 1,278.4 9,652.5 67.4 10,998.3
Policyholder investment contract liabilities(2) 12 (1,075.2) (9,630.8) (63.9) (10,769.9)
Other liabilities 14 (65.1) - - (65.1)
Total financial liabilities measured at fair value(2) (1,140.3) (9,630.8) (63.9) (10,835.0)
(1) The comparative amounts have been restated to reflect the
reclassification of money market funds from financial assets measured at
amortised cost to financial assets measured at FVTPL. Money market funds are
classified as level 1 financial instruments in the fair value hierarchy.
(2) The comparative amount for Interest-bearing stocks, debentures and
other loans within the investments backing policyholder funds of £1,897.8
million was reclassified from level 1 to level 2 to correctly reflect the
measurement of these investments. The comparative amount of policyholder
investment contract liabilities, for which the value is linked to the
investments backing policyholder funds, was also restated accordingly.
During the years ended 31 March 2023 and 2022, there were no transfers between
level 1 and level 2, or transfers into or out of level 3. The Group's policy
is to recognise transfers between levels of fair value hierarchy as at the end
of the reporting period in which they occur.
Information about level 3 fair value measurements
Unlisted investment vehicles represent the Group's investment in Ninety One
Africa Private Equity Fund 2 L.P. and Ninety One Global Alternative Fund 2
SCSp RAIF - European Credit Opportunities Fund 1 (2022: investment in Ninety
One Africa Private Equity Fund 2 L.P. and Ninety One Global Alternative Fund 2
SCSp RAIF - European Credit Opportunities Fund 1). The key unobservable input
used in measuring their fair values is the value of the underlying investments
of these funds which are calculated by the General Partners using multiple
valuation techniques such as amortised cost, EBITA multiple or NPV.
Investments backing policyholder funds/policyholder investment contract
liabilities include credit exposures that are not actively traded and where
the principal input in their valuation (i.e. credit spreads) is unobservable.
Accordingly, an alternative valuation methodology has been applied being an
EBITDA multiple, discounted cashflow models with spread adjustments for any
credit rating downgrades or expected cost recovery. All of the investment risk
associated with these assets is borne by policyholders and the value of these
assets is exactly matched by a corresponding liability due to policyholders.
The Group bears no risk from a change in the market value of these assets
except to the extent that it has an impact on management fees earned.
A sensitivity analysis on the Group's level 3 investments has not been
presented as the "stressing" of the significant unobservable inputs applied in
the valuation does not have a material impact on the condensed consolidated
financial statements.
The movements during the year in the balance of the level 3 fair value
measurements were:
2023 2022
Unlisted investment vehicles £'m £'m
At 1 April 3.5 5.5
Purchase/(disposal) 4.3 (1.3)
Unrealised gain/(loss) 0.2 (0.7)
At 31 March 8.0 3.5
Investments backing policyholder funds
At 1 April 63.9 69.1
Disposal (10.1) (5.8)
Unrealised gain/(loss) 0.1 (4.1)
Foreign exchange difference (8.0) 4.7
At 31 March 45.9 63.9
18 Notes to the condensed consolidated statement of cash flows
18(a) Reconciliation of cash flows from operations
2023 2022
Notes £'m £'m
(Restated)
Profit before tax 212.6 267.1
Cash flows from operations - shareholders(2)
Adjusted for:
Net gain on investments 4 (1.0) (1.2)
Depreciation of property and equipment 3 4.9 5.3
Depreciation of right-of-use assets 3 9.9 9.7
Net interest (income)/expense 5 (5.8) 0.1
Net loss of pension fund 0.2 0.1
Gain on disposal of subsidiaries 6 - (14.9)
Share of profit from associates (1.4) (0.4)
Share-based payment charges related to Ninety One share scheme 16(b) 14.2 12.1
Working capital changes:
Trade and other receivables 3.5 2.6
Assets classified as held for sale - 12.2
Trade and other payables (35.8) (28.2)
Other liabilities (9.4) (15.4)
Liabilities classified as held for sale - (7.6)
191.9 241.5
Cash flows from operations - policyholders(1,2)
Net fair value gains on linked investments backing policyholder funds 12 (359.0) (478.5)
Net fair value change on policyholder investment contract liabilities 12 741.0 772.6
Net contributions received from policyholders 12 6.9 202.1
Net acquisition of linked investments backing policyholder funds(1) 12 (444.3) (423.0)
Working capital changes:
Trade and other receivables 2.0 (15.7)
Trade and other payables (16.4) 0.5
(69.8) 58.0
(1) The comparative amounts have been restated to reflect the
reclassification of net acquisition of linked investments backing policyholder
funds from investing activities, to operating activities. These changes are
considered to improve the consistency of the classification of cash flows
related to policyholders and to align the presentation with other sections of
the results announcement.
(2) The note has been re-presented to include the split of shareholder and
policyholder cash flows.
18(b) Reconciliation of liabilities arising from financing activities
The table below details changes in the Group's liabilities from financing
activities, including both cash and non-cash changes. Liabilities arising from
financing activities are liabilities for which cash flows were, or future cash
flows will be, classified in the condensed consolidated statement of cash
flows as cash flows from financing activities.
Lease liabilities
2023 2022
£'m £'m
At 1 April 109.4 110.4
Changes from cash flows:
Principal elements of lease payments (10.3) (5.3)
Interest paid in respect of lease liabilities (3.6) (1.7)
Payment of lease liabilities (13.9) (7.0)
Other changes:
Additions and remeasurements of lease liabilities 2.8 0.8
Interest expense 5 3.6 3.8
Foreign exchange adjustments 0.8 1.4
At 31 March 102.7 109.4
19 Related party transactions
In May 2022, Investec distributed 15 percent of the Group's shares to its
ordinary shareholders. Following the completion of the distribution,
Investec's percentage holding in the Group has reduced to approximately 10
percent on a DLC basis. Investec is no longer considered to be a related party
to the Group according to IAS24 Related Party Disclosures.
Other than the above, related party transactions for the year are similar to
those disclosed in the Group's annual financial statements for the year ended
31 March 2022. No new significant related party transactions arose during the
year.
20 Events after the reporting date
Other than the dividend recommended by the Board presented in note 9, no event
was noted after the reporting date that would require disclosures in or
adjustments to the condensed consolidated financial statements.
Annexure to the condensed consolidated financial statements
Condensed consolidated statement of financial position (including policyholder
figures)
2023 2022
Policy-holders Share-holders Total Policy-holders Share-holders Total
£'m £'m £'m £'m £'m £'m
Assets
Investments(1) - 43.5 43.5 - 36.3 36.3
Investment in associates - 1.3 1.3 - 0.9 0.9
Property and equipment - 23.0 23.0 - 26.6 26.6
Right-of-use assets - 76.7 76.7 - 83.1 83.1
Deferred tax assets - 25.5 25.5 - 28.1 28.1
Other receivables - 3.4 3.4 - 3.3 3.3
Pension fund asset - 2.6 2.6 - - -
Total non-current assets - 176.0 176.0 - 178.3 178.3
Investments(1) - 24.4 24.4 - 34.8 34.8
Linked investments backing policyholder funds 9,962.6 - 9,962.6 10,785.9 - 10,785.9
Income tax recoverable 0.3 8.9 9.2 - 10.4 10.4
Trade and other receivables 64.7 195.9 260.6 66.7 199.4 266.1
Cash and cash equivalents - 379.6 379.6 - 406.6 406.6
Total current assets 10,027.6 608.8 10,636.4 10,852.6 651.2 11,503.8
Total assets 10,027.6 784.8 10,812.4 10,852.6 829.5 11,682.1
Liabilities
Other liabilities - 33.7 33.7 - 30.2 30.2
Lease liabilities - 92.2 92.2 - 99.5 99.5
Pension fund obligation - - - - 0.1 0.1
Deferred tax liabilities 24.2 0.1 24.3 30.0 0.4 30.4
Total non-current liabilities 24.2 126.0 150.2 30.0 130.2 160.2
Policyholder investment contract liabilities 9,967.3 - 9,967.3 10,769.9 - 10,769.9
Other liabilities - 21.9 21.9 - 34.9 34.9
Lease liabilities - 10.5 10.5 - 9.9 9.9
Trade and other payables 36.1 266.1 302.2 52.5 301.9 354.4
Income tax payable - 10.4 10.4 0.2 11.0 11.2
Total current liabilities 10,003.4 308.9 10,312.3 10,822.6 357.7 11,180.3
Equity
Share capital - 441.2 441.2 - 441.2 441.2
Demerger reserves (re-presented) - (321.3) (321.3) - (321.3) (321.3)
Own share reserve - (51.4) (51.4) - (35.7) (35.7)
Other reserves (re-presented) - (6.6) (6.6) - 4.0 4.0
Retained earnings - 287.9 287.9 - 253.3 253.3
Shareholders' equity excluding non-controlling interests - 349.8 349.8 - 341.5 341.5
Non-controlling interests - 0.1 0.1 - 0.1 0.1
Total equity - 349.9 349.9 - 341.6 341.6
Total equity and liabilities 10,027.6 784.8 10,812.4 10,852.6 829.5 11,682.1
(1) The comparative amounts have been restated to reclassify a portion of
deferred compensation investments from current assets to non-current assets.
Accordingly, the prior year numbers for current investments changed from
£61.9 million to £34.8 million and non-current investments changed from
£9.2 million to £36.3 million. The purpose of this change is to better
reflect the timing of the realisation of the investments.
Annexure to the condensed consolidated financial statements
Condensed consolidated statement of cashflows (including policyholder figures)
2023 2022
Policy-holders Share-holders Total Policy-holders Share-holders Total
£'m £'m £'m £'m £'m £'m
Cash flows from operations(1) (69.8) 191.9 122.1 58.0 241.5 299.5
Interest received - 9.6 9.6 - 3.9 3.9
Interest paid in respect of lease liabilities - (3.6) (3.6) - (1.7) (1.7)
Other interest paid - (0.2) (0.2) - (0.2) (0.2)
Contributions to pension fund - (0.1) (0.1) - (0.2) (0.2)
Dividends received from associates(1) - 1.0 1.0 - 0.7 0.7
Income tax paid - (54.2) (54.2) - (69.7) (69.7)
Net cash flows from operating activities(1) (69.8) 144.4 74.6 58.0 174.3 232.3
Cash flows from investing activities
Net disposal of investments - 2.7 2.7 - 12.9 12.9
Distributions from investments - 0.9 0.9 - - -
Disposal of subsidiaries, net of cash disposed - - - - 17.7 17.7
Additions to property and equipment - (1.2) (1.2) - (1.4) (1.4)
Net cash flows from investing activities(1) - 2.4 2.4 - 29.2 29.2
Cash flows from financing activities
Principal elements of lease payments - (10.3) (10.3) - (5.3) (5.3)
Purchase of own shares - (23.8) (23.8) - (16.7) (16.7)
Dividends paid - (130.2) (130.2) - (123.7) (123.7)
Net cash flows from financing activities - (164.3) (164.3) - (145.7) (145.7)
Cash and cash equivalents at 1 April 163.7 406.6 570.3 106.0 341.0 447.0
Net change in cash and cash equivalents (69.8) (17.5) (87.3) 58.0 57.8 115.8
Effect of foreign exchange rate changes (22.6) (9.5) (32.1) (0.3) 7.8 7.5
Cash and cash equivalents at 31 March 71.3 379.6 450.9 163.7 406.6 570.3
(1) The comparative amounts have been restated to reflect the
reclassification of net acquisition of linked investments backing policyholder
funds and dividends received from associates, from investing activities to
operating activities.
Accordingly, the prior year numbers have been amended as follows:
· net cash flows from investing activities has changed from net
outflow of £393.1 million to net inflow of £29.2 million,
· cash flows from operations - policyholders has changed from net
inflow of £481.0 million to net inflow of £58.0 million, and
· net cash flows from operating activities has changed from net
inflow of £654.6 million to net inflow of £232.3 million.
These changes are considered to improve the consistency of the classification
of cash flows related to policyholders and associates and to align the
presentation with other sections of the results announcement.
SHAREHOLDER INFORMATION AND DIVIDEND ANNOUNCEMENT
In terms of the DLC structure, Ninety One plc shareholders registered on the
United Kingdom share register may receive all or part of their dividend
entitlements through dividends declared and paid by Ninety One plc on their
ordinary shares and/or through dividends declared and paid on the SA DAN share
issued by Ninety One Limited.
Ninety One plc shareholders registered on the South African branch register
may receive all or part of their dividend entitlements through dividends
declared and paid by Ninety One plc on their ordinary shares and/or through
dividends declared and paid on the SA DAS share issued by Ninety One Limited.
Ninety One plc dividend announcement
Notice is hereby given that a gross final dividend of 6.7 pence per ordinary
share has been recommended by the Board from income reserves in respect of the
financial year ended 31 March 2023. The final dividend will be paid on 11
August 2023 to shareholders recorded in the shareholders' registers of the
company on close of business 21 July 2023.
Ninety One plc shareholders registered on the United Kingdom share register,
will receive their dividend payment by Ninety One plc of 6.7 pence per
ordinary share.
Ninety One plc shareholders registered on the South African branch register,
will receive their dividend payment by Ninety One Limited, on the SA DAS
share, equivalent to 6.7 pence per ordinary share.
The relevant dates for the payment of the dividend are as follows:
Last day to trade cum-dividend
On the Johannesburg Stock Exchange ("JSE") Tuesday, 18 July 2023
On the London Stock Exchange ("LSE") Wednesday, 19 July 2023
Shares commence trading ex-dividend
On the JSE Wednesday, 19 July 2023
On the LSE Thursday, 20 July 2023
Record date (on the JSE and LSE) Friday, 21 July 2023
Payment date (on the JSE and LSE) Friday, 11 August 2023
Share certificates on the South African branch register may not be
dematerialised or rematerialised between Wednesday, 19 July 2023 and Friday,
21 July 2023, both dates inclusive, nor may transfers between the United
Kingdom share register and the South African branch register take place
between Wednesday, 19 July 2023 and Friday, 21 July 2023, both dates
inclusive.
Additional information for Ninety One shareholders registered on the South
African branch register
· The final dividend paid by Ninety One plc to shareholders registered
on the South African branch register is a local payment derived from funds
sourced in South Africa.
· Shareholders registered on the South African branch register are
advised that the distribution of 6.70000 pence, equivalent to a gross dividend
of 160.00000 cents per share, has been arrived at using the rand/pound
Sterling average buy/sell spot rate of ZAR23.9/GBP, as determined at 11:00 (SA
time) on Tuesday, 16 May 2023.
· Ninety One plc United Kingdom tax reference number: 623 59652
16053.
· The issued ordinary share capital of Ninety One plc is 622,624,622
ordinary shares.
· The dividend paid by Ninety One plc to South African resident
shareholders registered on the South African branch register and the dividend
paid by Ninety One Limited to Ninety One plc shareholders on the SA DAS share
are subject to South African Dividend Tax ("Dividend Tax") of 20% (subject to
any available exemptions as legislated).
· Shareholders registered on the South African branch register who are
exempt from paying the Dividend Tax will receive a net dividend of 160.00000
cents per share, paid by Ninety One Limited on the SA DAS share.
· Shareholders registered on the South African branch register who are
not exempt from paying the Dividend Tax will receive a net dividend of
128.00000 cents per share (gross dividend of 160.00000 cents per share less
Dividend Tax of 32.00000 cents per share) paid by Ninety One Limited on the SA
DAS share.
By order of the board
Paula Watts
Company Secretary
16 May 2023
Ninety One Limited dividend announcement
Notice is hereby given that a gross final dividend of 160.0 cents per ordinary
share has been recommended by the Board from income reserves in respect of the
financial year ended 31 March 2023. The final dividend will be paid on 11
August 2023 to shareholders recorded in the shareholders' register of the
company on close of business 21 July 2023.
The relevant dates for the payment of the dividend are as follows:
Last day to trade cum-dividend Tuesday, 18 July 2023
Shares commence trading ex-dividend Wednesday, 19 July 2023
Record date Friday, 21 July 2023
Payment date Friday, 11 August 2023
The final gross dividend of 160.0 cents per ordinary share has been determined
by converting the Ninety One plc distribution of 6.7 pence per ordinary share
into rands using the rand/pound sterling average buy/sell spot rate of
ZAR23.9/GBP, as determined at 11:00 (SA time) on Tuesday, 16 May 2023.
Share certificates may not be dematerialised or rematerialised between
Wednesday, 19 July 2023 and Friday, 21 July 2023, both dates inclusive.
Additional information to take note of:
· The final dividend paid by Ninety One Limited to shareholders
registered on the South African register is a local payment derived from funds
sourced in South Africa.
· Ninety One Limited South African tax reference number: 9661 9311
71.
· The issued ordinary share capital of Ninety One Limited is
300,089,454 ordinary shares.
· The dividend paid by Ninety One Limited is subject to South African
Dividend Tax ("Dividend Tax") of 20% (subject o any available exemptions as
legislated).
· Shareholders who are exempt from paying the Dividend Tax will receive
a net dividend of 160.00000 cents per ordinary share.
· Shareholders who are not exempt from paying the Dividend Tax will
receive a net dividend of 128.00000 cents per ordinary share (gross dividend
of 160.00000 cents per ordinary share less Dividend Tax of 32.00000 cents per
ordinary share).
By order of the board
Ninety One Africa Proprietary Limited
Company Secretary
16 May 2023
Ninety One plc
Ninety One Limited
Incorporated in England and Wales
Incorporated in the Republic of
South Africa
Registration number 12245293
Registration number
2019/526481/06
Date of registration: 4 October 2019
Date of registration: 18
October 2019
LSE share code: N91
JSE share
code: NY1
JSE share code: N91
ISIN:
ZAE000282356
ISIN: GB00BJHPLV88
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