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Brooks Macdonald full year results show strong strategic progress

Brooks Macdonald Group plc today announces its audited results for the year ended 30 June 2021.

Financial highlights

  • Group FUM reached record level of £16.5 billion (up 20.3% on FY20)
  • Net flows improved each quarter and were positive in H2 at a Group level, with the core UKIM discretionary business positive for the full year, demonstrating organic growth momentum which has continued into FY22 with both months positive
  • Group revenue of £118.2 million, up 8.8% on FY20, driven by FUM growth and the successful integration of the two recently acquired businesses
  • Underlying profit margin up by 4.7 points to 25.9%, in line with the Group’s commitment to deliver top quartile margin over the medium term
  • Continued strong investment performance of 15.8% for the year, well ahead of the 12.9% for the MSCI PIMFA Private Investor Balanced Index
  • Improved performance and underlying profit margin in both the UKIM and International business segments, in part boosted by the contribution of the acquired businesses
  • Total dividend increased by 18.9% to 63.0p (FY20: 53.0p) reflecting the Board’s confidence in the Group’s prospects.

 

Strategic progress

  • Andrew Shepherd appointed as new CEO, bringing unrivalled experience and knowledge of the industry from his 27-year financial services career, including 19 years at Brooks Macdonald
  • Successfully completed integration of two high-quality acquisitions, Cornelian Asset Managers and Lloyds Banking Group’s Channel Islands funds and wealth management business, which have both delivered above the targeted earnings accretion, underlining the Group’s acquisition capabilities
  • Rapid growth of Brooks Macdonald Investment Solutions proposition, with strong pipeline for FY22
  • Near 50% increase in FUM for specialised Bespoke Portfolio Service products – Responsible Investment Service (“RIS”), Court of Protection, Decumulation, AIM Portfolio Service – underlining ongoing strong demand as the Group continued to innovate for clients and advisers
  • Private Clients proposition launched post period end to build an integrated wealth management service with specialist advice from internal IFA team, designed to ensure direct clients get the best possible service, operating alongside core outsourced investment offering to third party IFAs
  • Material progress on the Group’s digital transformation – partnered with SS&C, the global wealth management technology and operations company, to deliver best-in-class client and intermediary experience and service levels. Initial deliveries of funds business processes and digital onboarding successful. Expecting SS&C to complete the current phase, which is the transition of all client- and intermediary-facing processes on to their platform, by the end of this calendar year.

 

Outlook

  • Fundamental opportunity remains strong, driven by demographic and policy trends as well as increasing adviser demand for outsourced investment management, where the Group aims to be the partner of choice
  • Well positioned to continue to deliver on ambitious growth strategy with a strong pipeline and net flows expected to improve further over FY22, looking to the future with confidence.

 

Andrew Shepherd, CEO designate of Brooks Macdonald, commented: “I am pleased to report that, in a period dominated by the pandemic, we have not only again delivered strong financial performance, but we have also made further progress against our strategic ambitions. FUM reached record levels, we increased our profit margin and delivered record revenue and underlying profit – at the same time as successfully integrating two acquisitions to increase the Group’s scale, service offerings, and capabilities. And all in our 30th anniversary year!

“We continued to deliver a high-quality service to clients and made great progress in our ongoing ambitions to transform client and intermediary service levels through technology and innovation. None of this would have been possible without the steadfast commitment and hard work of our people who have done an exceptional job during the most unprecedented circumstances.

“I am excited to lead the firm at a time of great opportunity for Brooks Macdonald, based on our vision as the leading investment manager for intermediaries. Our strategy is working, grounded in our purpose of realising ambitions and securing futures. We are in a strong position, primed to deliver on our ambitious growth aspirations.”

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