Schroders share price: Q3 profit surges 14 percent despite outflows

Company notes ‘heightened’ market volatility

Schroders share price: Q3 profit surges 14 percent despite outflows

Schroders Plc (LON:SDR) today reported that pre-tax profit for the three months to October have risen 14 percent on an annual basis to £148.6 million, despite net outflows of £500 million.

The firm’s assets under management (AUM) had fallen 4.9 percent in the last quarter to £294.8 billion. The drop was primarily driven by a £14.6 billion loss in investment returns.

Still, net revenue for the third quarter was 0.4 percent higher year-on-year at £395.3 million, while adjusted pre-tax profit, which excludes irregular items, was up 3.2 percent at £147.5 million.

“These results reflect the resilience of our diversified business at a time of heightened market volatility," chief executive Michael Dobson said.

Investors welcomed Schroders’ report, with the firm’s share price gaining 0.57 percent to 3,021.00p as of 10:55 GMT, as compared with a 0.5 percent loss for the FTSE 100.

On a nine-month basis, the firm’s results were markedly better, with profit up 21 percent at £438.9 million, while net inflows were up 18 percent at £8.3 billion.

Analysts attributed the discrepancy to the downbeat quarter for the stock market in general, with the FTSE 100 losing seven percent.

Bloomberg noted, however, that Schroders’ results compare with Henderson Group which reported net inflows of £1.3 billion for the quarter. Henderson also logged a drop in AUM, however, “with market weakness outweighing new business gains”.

As of 11:14 GMT, Thursday, 05 November, Schroders plc share price is 3,020.50p.

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