Their Total Funds under Management (“FUM”) reached a record level of £15.5 billion on 31 December 2020 (30 June 2020: £13.7 billion, 31 December 2019: £13.1 billion), representing an increase of 13.3% in the period. They say it was driven by a robust investment performance of 9.5% despite volatile markets, compared to an increase of 6.5% in the MSCI PIMFA Private Investor Balanced Index. Net flows of £367 million (H1 FY20: £506 million), with Q2 stronger than Q1, evidence early signs of an improving trend.
The Group say they entered the next phase of its strategy during the period, based on its vision for Brooks Macdonald as the leading investment managers for intermediaries. The strategy was focused on accelerating growth and value creation, grounded in the Group’s purpose of realising ambitions and securing futures.
They did so by building momentum in organic growth. This meant focusing on delivering for advisers and clients throughout the pandemic to generate growth momentum. They did so by increasing traction, with a strong pipeline, for the BM Investment Solutions offering in which they provided a white-labelled bespoke proposition to advisers and their clients.
Strong growth in the Group’s other specialist services – Court of Protection, Decumulation, and the AIM Portfolio Service reflect the benefit of service innovation to meet clients’ changing needs. They brought together the private client teams across UKIM and Financial Planning to deliver the same high level of service to those clients (representing c.£2.5bn FUM) as to their intermediated clients.
Caroline Connellan, CEO, commented: “We continued to make good progress in the first half of the year, delivering strong financial performance as we moved into the next phase of our strategy, focused on accelerating growth and value creation. Our ongoing robust investment performance, coupled with high-quality acquisitions, brought FUM to record levels and, alongside strong cost discipline, resulted in record underlying profit margin. This shows that the investment we have made and the actions we have taken are delivering financial and strategic benefits for the business now and positioning us well for the future”.
The Group also commenced a strategic partnership with SS&C Technologies (“SS&C”), a global provider of software and technology services, to deliver a best-in-class digital experience for advisers and clients. They expect to complete the transition to the SS&C platform by the end of this calendar year.
The completion of the acquisition of Lloyds Banking Group’s Channel Islands funds and wealth management business is one example of how they integrated high-quality, accretive acquisitions. They also successfully integrated Cornelian Asset Managers Limited (acquisition completed February 2020), delivering the planned synergies despite the pandemic. They state both are on track to deliver planned earnings accretion.
They say that developing and supporting their staff, whilst attracting new talent was a key focus. The safeguarding of employees whilst continuing to deliver for advisers and clients, including being flexible for staff with homeschooling commitments was important. The latest survey showed a 14 point improvement in employee engagement score relative to the first survey in 2019, two points up on the most recent survey in May 2020.
Brooks Macdonald Group plc, through its various subsidiaries, provides leading investment management services in the UK and internationally. The Group, which was founded in 1991 and began trading on AIM in 2005, had discretionary Funds under Management of £15.5 billion as at 31 December 2020.
“I am particularly proud of how our people have delivered for advisers and clients through the pandemic and I am grateful to them for their efforts”, continued Connellan. “The blend of experience and expertise that our people have, from those already deeply embedded in the Brooks Macdonald client-centred culture to those bringing new external insights, is a great strength.
Looking ahead, client sentiment has held up well and, although the timescale for easing of lockdown restrictions remains uncertain, we continue to have a positive outlook. Momentum is building in the business and we are on track to meet full year profit expectations”.
You can find more information about Brooks Macdonald Group plc on its website.