Trading Statement

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

LEI: 549300XVXU6S7PLCL855

For immediate release

12 April 2022

Stock Exchange Announcement

LIONTRUST ASSET MANAGEMENT PLC

Trading Update

 

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

 

Highlights

 

· Net outflows of £0.4 billion in the three months ended 31 March 2022 and net inflows of £2.5 billion for the financial year ended 31 March 20221.

 

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

 

· Majedie Asset Management Limited ("Majedie") acquisition completed on 1 April 2022 adding £5.2 billion2 to AuMA, taking Liontrust's pro forma AuMA to £38.7 billion.

 

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

 

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

 

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

 

1 Includes outflows of £329 million related to the termination of the investment management agreement for the Verbatim Portfolio Growth Funds ("Verbatim Funds") on 21 March 2022.
2 As at close of business on 31 March 2022.

 

Commenting, John Ions, Chief Executive, said:

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

Assets under management and advice

 

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

 

Process

Total

Institutional3

UK Retail

Multi-Asset

Offshore


(£m)

(£m)

(£m)

(£m)

(£m)

Sustainable Investment

13,227

136

12,187

-

904

Economic Advantage

9,035

455

8,201

-

379

Multi-Asset

6,660

-

-

6,660

-

Global Equity

2,868

167

2,701

-

-

Cashflow Solution

1,094

650

364

-

80

Global Fixed Income

664

-

300

-

364

Total - 31 March 2022

33,548

1,408

23,753

6,660

1,727







Global Fundamental

5,150

3,567

898

-

685

Total inc. Global Fundamental

38,698

4,975

24,651

6,660

2,412

 

3 Investment Trust AuMA included in Institutional

 

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

 

Flows

 

The net outflows over the three months to 31 March 2022 were £432 million4 (2021: net inflows £958 million). A reconciliation of fund flows and AuMA over the three months to 31 March 2022 is as follows:

 


Total

Institutional

UK Retail

Multi-Asset

Offshore


(£m)

(£m)

(£m)

(£m)

(£m)







Opening AuMA - 1 January 2022

37,239

1,535

26,304

7,375

2,025







Net flows

(432)

(17)

84

(398)

(101)







Market and Investment performance

(3,259)

(110)

(2,635)

(317)

(197)







Closing AuMA - 31 March 2022

33,548

1,408

23,753

6,660

1,727

 

The net inflows over the financial year to 31 March 2022 were £2,488 million4 (2021: £3,498 million). A reconciliation of fund flows and AuMA over the financial year to 31 March 2022 is as follows:

 


Total

Institutional

UK Retail

Multi-Asset

Offshore


(£m)

(£m)

(£m)

(£m)

(£m)







Opening AuMA - 1 April 2021

30,929

1,488

20,627

7,139

1,675







Net flows

2,488

(105)

3,025

(541)

109







Market and Investment performance

131

25

101

62

(57)







Closing AuMA - 31 March 2022

33,548

1,408

23,753

6,660

1,727

 

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

 

UK Retail Fund Performance (Quartile ranking)

 


Quartile ranking - Since Launch/Manager Appointed

Quartile ranking - 5 year

Quartile ranking - 3 year

Quartile ranking - 1 year

Launch Date/ Manager Appointed

Economic Advantage funds

Liontrust UK Growth Fund

1

1

2

1

25/03/2009

Liontrust Special Situations Fund

1

1

1

3

10/11/2005

Liontrust UK Smaller Companies Fund

1

1

1

1

08/01/1998

Liontrust UK Micro Cap Fund

1

1

1

2

09/03/2016

Sustainable Future funds

Liontrust Monthly Income Bond Fund

2

1

1

2

12/07/2010

Liontrust SF Managed Growth Fund

2

1

1

3

19/02/2001

Liontrust SF Corporate Bond Fund

1

2

2

4

20/08/2012

Liontrust SF Cautious Managed Fund

1

1

2

4

23/07/2014

Liontrust SF Defensive Managed Fund

1

1

1

4

23/07/2014

Liontrust SF European Growth Fund

2

2

1

4

19/02/2001

Liontrust SF Global Growth Fund

3

1

1

3

19/02/2001

Liontrust SF Managed Fund

1

1

1

4

19/02/2001

Liontrust UK Ethical Fund

2

1

1

4

01/12/2000

Liontrust SF UK Growth Fund

2

1

2

4

19/02/2001

Global Equity funds5

Liontrust Balanced Fund

1

1

1

1

31/12/1998

Liontrust China Fund

4

3

3

3

31/12/2004

Liontrust Emerging Market Fund

2

4

4

3

30/09/2008

Liontrust Global Smaller Companies Fund

1

1

3

4

01/07/2016

Liontrust Global Alpha Fund

1

1

1

1

31/12/2001

Liontrust Global Dividend Fund

2

1

1

4

20/12/2012

Liontrust Global Innovation Fund

1

1

2

4

31/12/2001

Liontrust Global Technology Fund

3

2

2

1

15/12/2015

Liontrust Income Fund

1

1

2

1

31/12/2002

Liontrust India Fund

4

4

2

1

29/12/2006

Liontrust Japan Equity Fund

2

3

1

3

22/06/2015

Liontrust Latin America Fund

1

2

3

3

03/12/2007

Liontrust US Opportunities Fund

1

1

2

3

31/12/2002

Cashflow Solution funds



Liontrust European Growth Fund

1

1

1

1

15/11/2006

Global Fixed Income funds






Liontrust Strategic Bond Fund

3

3

4

08/05/2018

 

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

 

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

 

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

 


Quartile ranking - Since Launch/Manager Appointed

Quartile ranking - 5 year

Quartile ranking - 3 year

Quartile ranking - 1 year

Launch Date/ Manager Appointed

Global Fundamental team UK Funds6

LF Liontrust UK Equity Fund

1

4

4

3

27/03/2003

LF Liontrust UK Focus Fund

1

4

4

4

29/09/2003

LF Liontrust UK Equity Income Fund

2

3

4

3

19/12/2011

LF Liontrust Global Equity Fund

2

2

2

4

30/06/2014

LF Liontrust Global Focus Fund

2

2

3

4

30/06/2014

Global Fundamental team Irish Funds6





Liontrust GF US Equity Fund

3

2

2

4

26/06/2014

Liontrust GF UK Equity Fund

4

4

4

3

03/03/2014

Liontrust GF International Equity Fund

2

-

-

4

17/12/2019

 

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

 

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

 

Alternative Performance Measures

 

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

 

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

 

Full year results

 

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

 

For further information please contact:

 

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

John Ions: Chief Executive

Vinay Abrol: Chief Financial Officer & Chief Operating Officer

Simon Hildrey: Chief Marketing Officer

David Boyle: Head of Corporate Development

 

Singer Capital Markets (Tel: 020 7496 3000)

Corporate Broking: Tom Salvesen

Corporate Finance: Justin McKeegan

 

Panmure Gordon (Tel: 020 7886 2500)

Corporate Broking: Charles Leigh-Pemberton

Corporate Finance: Dominic Morley

 

Forward Looking Statements

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

 

Other information

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

 

ENDS

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