Brooks Macdonald 2018 interim results
- 25.8% year-on-year increase in total discretionary funds under management, reaching £11.7bn at 31 December, driving a 10.9% percentage increase in revenue
- 3.2% increase in underlying profit before tax - or 16.2% excluding the impact of the one-off investment in our risk management and operating framework - with all four businesses making good contributions to underlying profit before tax.
- Statutory profit fell due to a £5.5m increase in the provision for resolving legacy matters and a £1.0m increase in fair value of Levitas deferred consideration in light of strong net inflows into the funds.
- Over £1.25bn in discretionary FUM added during the half year:
o Organic growth (net new discretionary business) of £0.8bn or 7.7% over the half year, underlining the continuing growth opportunity in the adviser distribution channel
o Total year on year growth of over £2.4bn or 25.8%, including the benefit of above-benchmark investment performance
o High rates of FUM growth across UK Investment Management (11.8%), Funds (19.4%) and International (9.1%)
o Decline in revenue yield, driven principally by lower transactional income due to lower dealing volumes and more clients choosing flat fees, in line with the industry. Fee income continuing to grow in line with FUM, rate of yield decline levelling off and being offset through continued cost discipline.
- Continued investment and good progress in meeting current and future regulatory demands, notably MiFID II, GDPR and our risk management and operational framework.
- Focus now moving to building a sustainable and scalable operating platform, supporting future growth and delivering medium-term margin improvement.
- Interim dividend increase of 13.3% to 17p (2017: 15p) reflecting the Board's continued confidence in the strength of the underlying business and commitment to a progressive dividend policy.