UK's Rathbones H1 pretax profit on higher investment management fees
CORRECTED-UK's Rathbones H1 pretax profit rises on higher investment management fees Corrects headline to add dropped word "rises"
Overview
UK wealth manager's H1 FUMA rose 11% yr/yr to £120.7 bln
Underlying pretax profit for H1 up 14% yr/yr; Wealth Management net flows positive in Q2
Company completed £50 mln share buyback, launched further £20 mln buyback in H1
Outlook
Rathbones expects cessation of cash portfolio fees to reduce H2 income and operating profit by about £9 mln
Company revises Q4 operating margin target to 28.7% from 30.0%
Lower technology costs and ongoing efficiencies expected to support H2 performance
Result Drivers
FEE AND COMMISSION INCOME - Higher investment management fees, increased commission income, and growth in financial planning revenues drove operating income
WEALTH MANAGEMENT INFLOWS - Positive net inflows in Wealth Management in Q2, with stronger client asset retention and momentum in new business activity
ASSET MANAGEMENT OUTFLOWS - Continued net outflows in Asset Management due to industry-wide pressure on active equity strategies
Company press release: ID:nRSc2592Oa
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
H1 Adjusted Pretax Profit | Beat | GBP 123.20 mln | GBP 120.80 mln (1 Analyst) |
H1 Dividend |
| GBP 0.32 |
|
H1 Operating Income |
| GBP 487.50 mln |
|
H1 Pretax Profit |
| GBP 72.10 mln |
|
Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 5 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the investment management & fund operators peer group is "buy"
Wall Street's median 12-month price target for Rathbones Group PLC is GBp1,950.00, about 13.5% above its July 28 closing price of GBp1,718.00
The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 10 three months ago
Reuters Recommended Reads
July 28 - UK's Man Group H1 AUM rises to record on investment performance
July 28 - Asset manager Invesco's quarterly profit rises on strong inflows, higher fees
July 29 - Germany's DWS Q2 revenue falls 6% sequentially, net income drops
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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)