TRADING STATEMENT for quarter ended 31 March 2016

RNS Number : 2792V

Man Group plc

15 April 2016

 

Press Release

15 April 2016

TRADING STATEMENT for the quarter ended 31 March 2016

Key points

·     Funds under management (FUM) of $78.6 billion at 31 March 2016 (31 December 2015: $78.7 billion)

·     Net inflows in the quarter of $0.5 billion, comprising sales of $5.1 billion and redemptions of $4.6 billion:

o  Net inflows across quant alternative ($1.3 billion) and for quant long only strategies ($0.4 billion), partially offset by;

o  Net outflows from discretionary alternative ($0.6 billion), discretionary long only ($0.5 billion), and guaranteed products ($0.1 billion);

o  Net flows for fund of fund alternatives flat for the quarter

·     Overall investment movement of negative $0.7 billion in the quarter:

o  Positive investment performance across AHL's range of strategies, adding $0.8 billion to FUM, more than offset by;

o  Negative investment performance for GLG, mainly across their long only strategies, reducing FUM by $1.5 billion;

o  Investment performance for Numeric and FRM broadly flat for the quarter

·     FX movements of positive $0.8 billion in the quarter, primarily driven by the weakening of the US Dollar against the Japanese Yen and Euro

·     Other negative movements of $0.7 billion in relation to negative investment exposure adjustments ($0.4 billion) and CLO and guaranteed product maturities ($0.3 billion)

Manny Roman, Chief Executive Officer of Man Group, said:

"Against the backdrop of challenging market conditions for the global investment management industry, we have delivered results for the first three months of the year that demonstrate the value and benefits of a diversified business model. Investment performance across our quantitative strategies and net inflows meant that group funds under management remained stable over a highly volatile quarter.

The ongoing uncertainty in the markets remains challenging and, accordingly, the risk appetite of our clients has the potential to impact flows. However, the ongoing diversification of our business has enhanced our resilience as a firm, and positions us well to navigate the current economic climate. As we have previously indicated, we continue to explore new options for growth, both organically and by acquisition, within our disciplined financial framework."

FIRST QUARTER FUM COMMENTARY

       FUM movements by product type

$bn	FUM at 31 Dec 2015	Sales	Redemptions	Net inflows / (outflows)	Investment movement	FX	Other	FUM at 31 March 2016
Alternative	44.6	3.1	(2.4)	0.7	0.5	0.7	(0.6)	45.9
Quant (AHL / Numeric)	16.4	1.9	(0.6)	1.3	0.8	0.3	(0.1)	18.7
Discretionary (GLG)	16.3	0.4	(1.0)	(0.6)	(0.3)	0.2	(0.2)	15.4
Fund of funds (FRM)	11.9	0.8	(0.8)	-	-	0.2	(0.3)	11.8
Long only	32.8	2.0	(2.1)	(0.1)	(1.2)	-	-	31.5
Quant (Numeric / AHL)	18.6	0.8	(0.4)	0.4	-	-	-	19.0
Discretionary (GLG)	14.2	1.2	(1.7)	(0.5)	(1.2)	-	-	12.5
Guaranteed	1.3	-	(0.1)	(0.1)	-	0.1	(0.1)	1.2
Total	78.7	5.1	(4.6)	0.5	(0.7)	0.8	(0.7)	78.6

ALTERNATIVES

Quant

Quant alternative (AHL / Numeric) FUM increased by $2.3 billion during the quarter driven by net inflows, positive investment performance and positive FX movements. The net inflows of $1.3 billion included $0.3 billion into Dimension, $0.3 billion into Alpha, $0.2 billion into Diversified and $0.5 billion into other AHL styles, which included $0.4 billion into our US onshore 40-Act strategy. Positive investment performance across the majority of AHL strategies drove the $0.8 billion of investment movement, with Evolution up 7.6%, Diversified up 5.4%, Dimension up 4.2%, and Alpha up 3.9% in the quarter. Positive FX movements of $0.3 billion were a result of the US Dollar weakening against the Euro, Japanese Yen and Australian Dollar. As at 31 March 2016, 71% of AHL open ended funds were at high watermark and 10% were within 5% of high watermark.

Discretionary

Discretionary alternatives (GLG) FUM decreased by $0.9 billion during the period, primarily driven by net outflows and negative investment performance. The net outflows of $0.6 billion were mainly from our North American equity and convertibles strategies. The negative investment movement of $0.3 billion in the quarter was due to negative performance across the range of strategies. FX movements were positive, increasing FUM by $0.2 billion in the quarter.  Other movements related to CLO maturities of $0.2 billion in the period. As at 31 March 2016, 9% of GLG performance fee eligible FUM was at high watermark and 55% was within 5% of high watermark.

Fund of funds

Alternative fund of funds (FRM) FUM reduced by $0.1 billion during the quarter as a result of negative other movements, partially offset by positive FX movements. Net flows were flat for the quarter.  Sales included $0.7 billion from recently awarded managed account mandates, and redemptions included $0.4 billion from FRM Diversified strategies. Investment movement was flat for the quarter. Positive FX movements increased FUM by $0.2 billion due to the weakening of the US Dollar in the period against the Japanese Yen and Euro. The negative other movements of $0.3 billion related to investment exposure adjustments. 

LONG ONLY

Quant

Quant long only (Numeric / AHL) FUM increased by $0.4 billion during the quarter as a result of net inflows, mainly into Numeric Emerging Markets. Investment movement was broadly flat across Numeric's range of strategies.  The asset weighted performance relative to a blend of applicable benchmarks (net of fees) across Numeric's product range was approximately -0.7%¹ for the quarter.

Discretionary

Discretionary long only (GLG) FUM decreased by $1.7 billion due to negative investment movement and net outflows in the period. Net outflows of $0.5 billion were mainly in relation to Japan CoreAlpha. The negative investment movement of $1.2 billion was mainly driven by Japan CoreAlpha, which was down 16.3% for the period (compared to the Topix which was down 12.0%).

GUARANTEED PRODUCTS

Guaranteed product FUM decreased by $0.1 billion in the quarter to $1.2 billion. There were no guaranteed product launches and redemptions were $0.1 billion. Positive FX movements increased FUM by $0.1 billion due to the weakening of the US Dollar against the Australian Dollar and Euro. Negative other movements of $0.1 billion related to maturities during the quarter.

¹ Numeric's asset weighted alpha YTD to 31 March 2016 is calculated using the asset weighted average of the performance relative to the benchmark for all non-restricted strategy composites available net of the highest management fees and, as applicable, performance fees that can be charged.  

FUM by manager

$bn	31 Mar 2016	31 Dec 2015	30 Sep 2015	30 Jun 2015	31 Mar 2015
AHL	19.2	16.9	17.9	15.8	16.5
AHL Diversified (inc. Guaranteed)	4.6	4.1	4.4	4.3	5.1
AHL Alpha	4.5	3.9	4.0	3.0	3.7
AHL Evolution	2.9	2.7	3.0	2.9	3.0
AHL Dimension	4.6	4.1	4.2	3.6	2.4
Europe and Asia Plus	0.9	1.2	1.1	1.2	1.7
Other specialist styles	1.7	0.9	1.2	0.8	0.6
Numeric	19.4	19.0	17.2	18.4	17.8
Global	10.6	10.8	9.3	9.7	9.6
Emerging markets	2.6	2.1	1.9	2.5	2.4
US	4.9	4.8	4.6	4.7	4.3
Alternatives	1.3	1.3	1.4	1.5	1.5
GLG	27.9	30.5	31.0	33.3	33.3
Alternatives	15.4	16.3	17.4	18.0	17.2
Europe equity	4.0	3.9	4.0	3.9	4.0
North America equity	1.1	1.3	2.2	2.5	2.2
Other equity	0.6	0.5	0.6	0.6	0.5
Convertibles	3.6	4.0	4.0	4.0	3.8
Market Neutral	0.5	0.6	0.6	0.7	0.7
CLO	5.0	5.1	5.2	5.5	5.3
Multi-strategy	0.6	0.9	0.8	0.8	0.7
Long only	12.5	14.2	13.6	15.3	16.1
Japan equity	7.0	8.6	7.7	8.7	10.3
Europe equity	2.2	2.0	1.7	1.6	1.2
UK equity	0.7	0.8	0.6	0.6	0.5
Other equity	1.0	1.1	1.4	1.7	1.3
Fixed income	1.6	1.7	2.2	2.7	2.8
FRM	12.1	12.3	10.7	11.3	10.5
Infrastructure and direct access	3.9	3.2	1.5	2.1	2.3
Segregated	2.8	2.6	3.1	3.0	3.0
Diversified FoHF	4.2	4.6	4.2	4.6	3.2
Thematic FoHF	0.9	1.5	1.5	1.1	1.4
Guaranteed	0.3	0.4	0.4	0.5	0.6
Total	78.6	78.7	76.8	78.8	78.1

	Investment performance
		Total Return			Annualised Return
		3 months to 31 Mar 16		12 months to 31 Mar 16	3 years to 31 Mar 16	5 years to 31 Mar 16
	AHL
	AHL Diversified1	5.4%		-5.3%	8.6%	5.4%
	AHL Alpha2	3.9%		-0.7%	7.4%	5.3%
	AHL Evolution3	7.6%		1.5%	15.0%	16.7%
	AHL Dimension4	4.2%		8.6%	7.9%	5.9%
	GLG ALTERNATIVES
	Equity
	Europe
	GLG European Long Short5	-2.4%*		-0.1%*	1.4%*	3.1%*
	Man GLG European Equity Alternative UCITS6	-2.6%		-0.6%	0.7%	n/a
	Man GLG European Alpha Alternative UCITS7	-0.8%		-1.6%	0.5%	1.1%
	UK
	Man GLG Alpha Select UCITS8	-0.5%		1.6%	5.6%	1.3%
	Global
	Man GLG Cred-Eq Alternative Class9	-5.5%		-11.1%	n/a	n/a
	Man GLG Value Opportunity 10	-4.8%*		-11.3%*	n/a	n/a
	Convertibles
	GLG Global Convertible11	-3.0%		-4.4%	0.8%	1.1%
	Man GLG Global Convertible UCITS12	-2.8%		-3.7%	2.7%	2.4%
	Market neutral
	GLG Market Neutral13	-2.6%*		-2.1%*	-1.3%*	1.8%*
	Man GLG European Distressed14	-1.9%*		4.1%*	1.0%*	2.6%*
	Multi-strategy
	Man Multi-Strategy15	-2.0%*		0.0%*	1.7%*	1.3%*
	GLG LONG ONLY
	Man GLG Europe Plus ETF16	-6.1%		-12.3%	6.4%	6.6%
	Man GLG Japan Core Alpha Equity17	-16.3%		-15.8%	10.5%	9.9%
	Man GLG Global Equity UCITS18	-4.7%		-9.2%	6.5%	5.4%
	Man GLG Strategic Bond19	2.4%		-4.2%	2.6%	n/a
	Man GLG Undervalued Assets20	-4.4%		-1.2%	n/a	n/a
	Man GLG European Equity21	-5.8%		-9.1%	10.6%	7.5%
	Man GLG UK Select22	-2.4%		-4.8%	8.0%	6.8%
	Man GLG Continental European Growth23	1.5%		19.0%	18.1%	12.4%

		Total Return		Annualised Return
		3 months to 31 Mar 16	12 months to 31 Mar 16	3 years to 31 Mar 16	5 years to 31 Mar 16
	FRM
	FRM Diversified II24	-3.4%	-5.9%	1.0%	1.1%
	Indices
	World stocks25	-1.8%	-4.4%	8.8%	8.4%
	World bonds26	3.8%	3.1%	4.2%	4.9%
	Corporate bonds27	7.4%	3.0%	5.9%	8.9%
	Hedge fund indices
	HFRI Fund of Funds Composite Index28	-2.5%	-5.1%	2.0%	1.4%
	HFRI Fund Weighted Composite Index28	-0.8%	-4.1%	2.1%	1.8%
	HFRX Global Hedge Fund Index28	-1.9%	-7.4%	-0.9%	-1.2%
	HFRI Fund of Funds Conservative Index28	-2.2%	-3.7%	2.0%	1.6%
	Style indices
	Barclay BTOP 50 Index29	1.8%	-3.8%	3.9%	1.8%
	HFRI Equity Hedge (Total) Index28	-1.7%	-4.5%	2.6%	1.8%
	HFRI EH: Equity Market Neutral Index28	0.6%	3.3%	4.1%	2.7%
	HFRI Macro (Total) Index28	1.2%	-3.3%	1.2%	0.2%
	HFRI Relative Value (Total) Index28	0.0%	-2.0%	2.5%	3.7%

		Total Return				Annualised Return
NUMERIC LONG ONLY		3 months to 31 Mar 16		12 months to 31 Mar 16		3 years to 31 Mar 16		5 years to 31 Mar 16
U.S. Large Cap Equity
Numeric Core		0.1%		-1.4%		13.5%		13.4%
Russell 1000®#		1.2%		0.5%		11.5%		11.4%
Relative Return		-1.1%		-1.9%		2.0%		2.0%
Numeric All Cap Core		-0.1%		-4.2%		11.5%		12.5%
Russell 3000®#		1.0%		-0.3%		11.1%		11.0%
Relative Return		-1.1%		-3.9%		0.4%		1.5%
Numeric Large Cap Core		-0.4%		-1.4%		13.9%		13.6%
S&P 500®#		1.3%		1.8%		11.8%		11.6%
Relative Return		-1.8%		-3.2%		2.1%		2.1%
Numeric Value		-0.2%		-2.2%		11.9%		12.5%
Russell 1000 Value®#		1.6%		-1.5%		9.4%		10.2%
Relative Return		-1.9%		-0.7%		2.5%		2.2%
Numeric Amplified Core (130/30)		-1.0%		1.5%		17.3%		16.9%
S&P 500®#		1.3%		1.8%		11.8%		11.6%
Relative Return		-2.3%		-0.2%		5.5%		5.3%
U.S. Small Cap Equity
Numeric Small Cap Core		-2.1%		-9.5%		8.7%		9.8%
Russell 2000®#		-1.5%		-9.8%		6.8%		7.2%
Relative Return		-0.5%		0.2%		1.8%		2.6%
Numeric Small Cap Growth		-4.5%		-12.4%		9.0%		9.9%
Russell 2000 Growth®#		-4.7%		-11.8%		7.9%		7.7%
Relative Return		0.1%		-0.6%		1.1%		2.2%
Numeric Small Cap Value		0.3%		-7.6%		8.7%		9.7%
Russell 2000 Value®#		1.7%		-7.7%		5.7%		6.7%
Relative Return		-1.4%		0.1%		2.9%		3.1%
Numeric SMID Growth		-2.6%		-10.6%		10.8%		10.3%
Russell 2500 Growth®#		-2.7%		-9.6%		9.2%		8.8%
Relative Return		0.0%		-1.0%		1.6%		1.6%
Global / Non-U.S. Equity
Numeric Global Core		-1.5%		-2.0%		10.7%		n/a
MSCI World®#		-0.3%		-3.5%		6.8%		n/a
Relative Return		-1.2%		1.4%		3.9%		n/a
Numeric Global Small Cap		-0.2%		-2.6%		n/a		n/a
MSCI World Small Cap®#		0.7%		-3.9%		n/a		n/a
Relative Return		-0.9%		1.3%		n/a		n/a
Numeric EAFE Core		-1.3%		-0.8%		n/a		n/a
MSCI EAFE®#		-3.0%		-8.3%		n/a		n/a
Relative Return		1.7%		7.5%		n/a		n/a
Numeric International Small Cap		-0.4%		6.0%		9.2%		9.5%
MSCI World ex U.S. Small Cap®#		0.6%		2.0%		5.9%		4.7%
Relative Return		-1.0%		4.0%		3.3%		4.8%
Numeric Europe Core (EUR)		-6.3%		-10.1%		11.4%		10.8%
MSCI Europe®# (EUR)		-7.1%		-13.7%		6.9%		6.6%
Relative Return		0.7%		3.6%		4.5%		4.1%
Numeric Japan Core (YEN)		-12.9%		-9.6%		12.0%		13.2%
MSCI Japan®# (YEN)		-12.7%		-12.9%		10.2%		10.6%
Relative Return		-0.3%		3.3%		1.8%		2.6%
Numeric Asia Pacific ex Japan		0.8%		-8.6%		n/a		n/a
Russell Asia Pacific ex Japan®#		1.4%		-10.4%		n/a		n/a
Relative Return		-0.6%		1.8%		n/a		n/a
Emerging Markets
Numeric Emerging Markets Alpha		5.1%		-11.5%		1.5%		2.1%
MSCI Emerging Markets®#		5.7%		-12.0%		-4.5%		-4.1%
Relative Return		-0.7%		0.5%		6.0%		6.3%
Numeric Emerging Markets Core		4.5%		-11.3%		n/a		n/a
MSCI Emerging Markets®#		5.7%		-12.0%		n/a		n/a
Relative Return		-1.2%		0.7%		n/a		n/a
NUMERIC LONG/SHORT
Numeric US Market Neutral		-0.9%		3.2%		2.8%		4.5%
Numeric World Market Neutral		-3.4%		0.7%		3.2%		4.3%
Numeric Alternative Market Neutral		-0.2%		2.2%		5.2%		5.6%
Numeric Absolute Return		2.0%		2.5%		4.7%		4.5%
ML 91-Day T-Bill®		0.1%		0.1%		0.1%		0.1%
	Source: Man database, Bloomberg, MSCI and Source. There is no guarantee of trading performance and past or projected performance is not a reliable indicator of future performance. Returns may increase or decrease as a result of currency fluctuations.
	1) Represented by Man AHL Diversified plc from 26 March 1996 to 29 October 2012, and by Man AHL Diversified (Guernsey) USD Shares - Class A from 30 October 2012 to date. The representative product was changed at the end of October 2012 due to legal and/or regulatory restrictions on Man AHL Diversified plc preventing the product from accessing the Programme's revised target allocations. Both funds are valued weekly; however, for comparative purposes, statistics have been calculated using the best quality price that is available at each calendar month end, using estimates where a final price is unavailable. Where a price, either estimate or final is unavailable on a calendar month end, the price on the closest date prior to the calendar month end has been used.
	2) Represented by AHL Alpha plc from 17 October 1995 to 30 September 2012, and by AHL Strategies PCC Limited: Class Y AHL Alpha USD Shares from 1 October 2012 to 30 September 2013. The representative product was changed at the end of September 2012 due to the provisioning of fund liquidation costs in October 2012 for AHL Alpha plc, which resulted in tracking error compared with other Alpha Programme funds. Both funds are valued weekly; however, for comparative purposes, statistics have been calculated using the best quality price that is available at each calendar month end, using estimates where a final price is unavailable. Where a price, either estimate or final is unavailable on a calendar month end, the price on the closest date prior to the calendar month end has been used. Both of the track records have been adjusted to reflect the fee structure of AHL Alpha (Cayman) Limited - USD Shares. From 30 September 2013, the actual performance of AHL Alpha (Cayman) Limited - USD Shares is displayed.
	3) Represented by AHL Strategies PCC: Class G AHL Evolution USD from 1 November 2006 to 30 November 2011; and by the performance track record of AHL Investment Strategies SPC: Class E AHL Evolution USD Notes from 1 December 2011 to 30 November 2012. From 1 December 2012, the track record of AHL (Cayman) SPC: Class A1 Evolution USD Shares has been shown. All returns shown are net of fees.
	4) Represented by AHL Strategies PCC Limited: Class B AHL Dimension USD Shares from 3 July 2006 to 31 May 2014, and by AHL Dimension (Cayman) Ltd - F USD Shares Class from 1 June 2014 until 28 February 2015 when AHL Dimension (Cayman) Ltd - A USD Shares Class is used. Representative fees of 1.5% Management Fee and 20% Performance Fee have been applied.
	5) Represented by GLG European Long Short Fund - Class D Unrestricted - EUR.
	6) Represented by Man GLG European Equity Alternative IN EUR.
	7) Represented by Man GLG European Alpha Alternative IN EUR.
	8) Represented by Man GLG Alpha Select Alternative IN H EUR.
	9) Represented by Man GLG Cred-Eq Alternative Class IN EUR
	10) Represented by Man GLG Value Opportunity Class B USD Unrestricted
	11) Represented by GLG Global Convertible Fund - Class A - USD.
	12) Represented by Man GLG Global Convertible UCITS Fund - Class IM USD.
	13) Represented by GLG Market Neutral Fund - Class Z Unrestricted - USD.
	14) Represented by Man GLG European Distressed Fund - Class A - USD.
	15) Represented by the gross return of Man GLG Multi-Strategy Fund - Class A - USD Shares until 31 December 2012. From 1 January 2013 the performance of Man Multi-Strategy Fund - Class G - USD Shares is displayed.
	16) Represented by the official performance of Man GLG Europe Plus Source ETF net of a 0.75% p.a. management fee and no performance fee. Provided by Source.
	17) Represented by Man GLG Japan CoreAlpha Equity Fund - Class I JPY.
	18) Represented by Man GLG Global Equity Fund - Class I T USD to Class I USD (13/05/2011).
	19) Represented by Man GLG Strategic Bond Fund Class A.
	20) Represented by Man GLG Undervalued Assets Fund - C Accumulation Shares.
	21) Represented by Man GLG European Equity Class I EUR
	22) Represented by Man GLG UK Select Fund Class A
	23) Represented by Man GLG Continental European Growth Fund Class A Accumulation Shares
	24) Represented by FRM Diversified II USD A
	25) Represented by MSCI World Net Total Return Index hedged to USD.
	26) Represented by Citigroup World Government Bond Index hedged to USD (total return).
	27) Represented by Citigroup High Grade Corp Bond TR.
	28) HFRI and HFRX index performance over the past 4 months is subject to change.
	29) The historic Barclay BTOP 50 Index data is subject to change.
	Please note that the dates in brackets represent the date of the join in the linked track records.
	*Estimated.

Unless otherwise stated, returns are based on the performance of unrestricted accounts or share classes within each strategy, as applicable. Performance is net-of-fees unless otherwise stated. Returns of accounts with client restrictions may differ.

#The reference index listed by Numeric is intended to best represent the strategy's universe. Investors may choose to compare returns for their accounts to different reference indices, resulting in differences in relative return information. Comparison to an index is for informational purposes only, as the holdings of an account managed by Numeric will differ from the securities which comprise the index and may have greater volatility than the holdings of an index.

Past or projected performance is no indication of future results. Returns may increase or decrease as a result of currency fluctuations. The information herein is being provided solely in connection with this press release and is not intended to be, nor should it be construed or used as, investment, tax or legal advice, any recommendation or opinion regarding the appropriateness or suitability of any investment or strategy, or an offer to sell, or a solicitation of an offer to buy, an interest in any security, including an interest in any fund or pool described herein.

 

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Michael Turner

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About Man Group

Man Group is one of the world's largest independent alternative investment managers, and a leader in  liquid investment strategies. Across its four investment managers (Man AHL, Man FRM, Man GLG and Man Numeric), Man Group has diverse hedge funds strategies and long only products across equity, credit, managed futures, convertibles, emerging markets and multi-manager solutions. At 31 March 2016, Man Group's funds under management were $78.6 billion.

The original business was founded in 1783. Today, Man Group plc is listed on the London Stock Exchange under the ticker EMG.L and is a constituent of the FTSE 250 Index.

Man Group also supports many awards, charities and initiatives around the world, including sponsorship of the Man Booker literary prizes. Further information can be found at www.man.com.

Forward looking statements and other important information

This document contains forward-looking statements with respect to the financial condition, results and business of Man Group plc. By their nature, forward-looking statements involve risk and uncertainty and there may be subsequent variations to estimates. Man Group plc's actual future results may differ materially from the results expressed or implied in these forward-looking statements.

The content of the websites referred to in this announcement is not incorporated into and does not form part of this announcement. Nothing in this announcement should be construed as or is intended to be a solicitation for or an offer to provide investment advisory services.

 

END

 

 

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