Liontrust reports further decline in assets as investors shun UK stocks
Liontrust, the specialist fund management group, has reported yet another drop in assets under management.
The company, which reported a 11.5 per cent decline in assets under management for the year to 31 March, said today assets had fallen further over the three months to 30 June.
The company reported outflows of £0.9bn for the period, which, although slightly better than the same period last year (£1.6bn), was still a disappointing result for the business.
Since March 2022, investors have withdrawn a total of £13bn from the group’s funds and products.
The group ended June with assets under management and advice of £27bn, a decline of 2.8 per cent from year-end.
The group finished 2023 with £27.8bn of assets under management, down from £31.4bn at the end of 2022.
John Ions, chief executive officer of Liontrust said: “Labour’s large majority in last week’s General Election should herald a period of stability that will be positive for financial markets.
He added: “Given the ever-increasing need for individuals to save more for their retirement as well, this will significantly improve the outlook for asset managers.”
“Liontrust is well placed for this improving environment as we have a strong brand, distribution, robust investment processes and a leading reputation for managing UK equities,” the boss continued.
Liontrust has struggled to retain client funds over the past decade despite snapping up several peers in an attempt to turn its fortunes around.
Last year, the group reported a full-year loss of £600,000, down from the £43.9m profit reported in the prior year, due to costs associated with its failed acquisition of Swiss rival GAM. The deal ultimately cost Liontrust £9.5m.
The company has also been dragged down by its heavy exposure to UK equities, which have struggled to attract investor attention since Brexit. UK equity funds have recorded record outflows since 2016, with the exodus accelerating in the past three years.
“While short-term flows are challenging to predict and we expect the business to remain in net outflows in Q2, we believe that it will be well positioned when investor sentiment returns to the UK equity market, with the potential of declining base rates acting as a tailwind,” Alexander Bowers, an analyst at Berenberg, said in a note.
Updated with analyst commentary