Trading statement - quarter ended 31 March 2018

RNS Number : 6475K

Man Group plc

12 April 2018

 

Press Release  

12 April 2018

TRADING STATEMENT for the quarter ended 31 March 2018

Key points

·     Funds under management (FUM) of $112.7 billion at 31 March 2018 (31 December 2017: $109.1 billion) with growth across all our core product categories

o  Net inflows in the quarter of $4.8 billion, driven by strong inflows into alternative risk premia, European long short and emerging market local currency strategies

o  Negative investment movement of $1.8 billion in the quarter

o  Positive FX movement of $1.2 billion in the quarter as the dollar weakened against Sterling, the Euro and Yen

o  Other movements of negative $0.6 billion

·     Completion of the $100 million share repurchase announced in October 2017

·     Intention to repurchase up to a further $100 million of shares; we continue to review further potential acquisition opportunities

Luke Ellis, Chief Executive Officer of Man Group, said:

"We are pleased to report an increase in funds under management in the first quarter to $112.7 billion, driven by net inflows of $4.8 billion. The ongoing interest in our range of strategies reflects our innovative offering and the strength of our client relationships. In particular, we continued to see client demand for our alternative risk premia strategies and saw flows returning to our European long short strategy, following a sustained period of improved performance.

The first quarter of 2018 was a weaker environment for equity markets and momentum strategies. While this impacted our absolute performance in some areas, outperformance across our long only and discretionary alternative strategies demonstrated the resilient and diversified nature of our business.

Looking forward we see continuing interest from clients, however, the institutional nature of our business means that flows are likely to be uneven on a quarter-to-quarter basis."

 

FIRST QUARTER FUM COMMENTARY

FUM movements by product type

$bn	FUM at 31 December 2017	Sales	Redemptions	Net inflows/ (outflows)	Investment movement	FX	Other	FUM at 31 March 2018
Alternative	61.7	5.7	(2.3)	3.4	(1.0)	0.4	(0.5)	64.0
Absolute return	29.2	2.8	(1.4)	1.4	(0.9)	0.1	(0.5)	29.3
Total return	16.5	2.8	(0.7)	2.1	(0.1)	0.2	(0.2)	18.5
Multi-manager solutions	16.0	0.1	(0.2)	(0.1)	-	0.1	0.2	16.2
Long only	47.2	5.6	(4.2)	1.4	(0.8)	0.8	(0.1)	48.5
Systematic	26.8	1.7	(1.6)	0.1	-	0.1	(0.1)	26.9
Discretionary	20.4	3.9	(2.6)	1.3	(0.8)	0.7	-	21.6
Guaranteed	0.2	-	-	-	-	-	-	0.2
Total	109.1	11.3	(6.5)	4.8	(1.8)	1.2	(0.6)	112.7

ALTERNATIVE

Absolute return

Absolute return FUM increased by $0.1 billion in the quarter. Net inflows included $1.0 billion into European equity long short and $0.3 billion into UK absolute return. Negative investment movement of $0.9 billion was due to negative performance across Man AHL's momentum strategies partially offset by positive performance across Man GLG's alternative strategies. As at 31 March 2018, 22% of Man AHL performance fee eligible FUM was at high watermark and 19% was within 5% of high watermark. As at 31 March 2018, 60% of Man GLG performance fee eligible FUM was at high watermark and 29% was within 5% of high watermark.

Total return

Total return FUM increased by 12% during the quarter. Net inflows included $1.3 billion into alternative risk premia strategies and a European CLO launch of $0.4 billion. Performance during the quarter was mixed with alternative risk premia strategies up 0.2% and emerging market debt total return strategies down 1.3% in the period. FX gains of $0.2 billion were due to the dollar weakening against the Euro and Sterling. Other movements included loan repayments at GPM and European CLO maturities.

Multi-manager solutions

Multi-manager solutions FUM increased to $16.2 billion during the quarter driven by leverage changes.

LONG ONLY

Systematic

Systematic long only FUM was slightly up in the quarter to $26.9 billion. The net inflow of $0.1 billion included inflows into Emerging Markets Core partially offset by outflows from Global Core. Investment movement was flat during the period with negative market moves offset by outperformance.

Discretionary

Discretionary long only FUM increased by $1.2 billion in the period. Net inflows of $1.3 billion included $0.8 billion into emerging markets local currency, $0.4 billion into UK undervalued assets, $0.3 billion into continental Europe and $0.2 billion into Japan CoreAlpha partially offset by outflows from convertibles strategies. The negative investment movement of $0.8 billion was driven by negative performance in Japan CoreAlpha as Japanese equity markets declined. Positive FX movements increased FUM by $0.7 billion, primarily due to the weakening of the dollar against the Yen.

GUARANTEED PRODUCTS

Guaranteed product FUM was $0.2 billion at the end of Q1. 
 

FUM by product category

$bn	31-Mar-17	30-Jun-17	30-Sep-17	31-Dec-17	31-Mar-18
Absolute return	26.4	26.6	27.2	29.2	29.3
AHL Dimension	5.2	5.1	5.7	5.9	5.3
AHL Alpha	4.2	4.2	4.0	4.4	4.1
AHL Evolution	3.0	3.3	3.4	3.7	3.4
AHL Diversified	3.0	3.0	2.9	2.9	2.9
AHL Institutional Solutions*	1.2	1.4	2.2	2.6	2.7
AHL other	1.8	2.0	1.8	1.8	1.6
Numeric absolute return	1.9	1.9	1.8	1.9	1.9
GLG Equity absolute return	3.6	3.6	3.4	3.8	5.5
GLG Credit absolute return	1.8	1.5	1.4	1.6	1.3
Multi-strategy	0.7	0.6	0.6	0.6	0.6
Total return	9.7	11.3	14.4	16.5	18.5
Diversified risk premia	1.4	1.6	4.1	5.7	7.5
EM total return	2.0	3.4	3.9	4.4	4.5
CLO	4.4	4.3	4.2	4.2	4.4
GPM	1.9	2.0	2.2	2.2	2.1
Multi-manager solutions	13.2	14.9	15.5	16.0	16.2
Infrastructure & Direct Access	5.5	7.4	7.1	7.7	7.7
Segregated	4.5	4.7	5.8	6.0	6.3
Diversified and thematic FoHF	3.2	2.8	2.6	2.3	2.2
Systematic long only	22.8	25.1	26.8	26.8	26.9
Global	13.0	14.9	15.9	16.0	15.4
Emerging markets	5.3	5.7	6.5	6.7	7.6
US	4.5	4.5	4.4	4.1	3.9
Discretionary Long only	16.3	17.8	19.4	20.4	21.6
Japan equity	7.3	7.9	8.5	9.7	9.5
Europe equity	1.0	1.3	1.9	2.0	2.4
US equity	1.3	1.1	1.2	1.2	1.2
Convertibles	2.3	2.5	2.5	2.2	2.0
UK equity	0.8	1.0	1.2	1.5	1.8
Other equity	0.9	1.0	1.0	1.0	1.0
Multi Asset	1.2	1.1	1.1	1.0	1.1
Fixed income	1.5	1.9	2.0	1.8	2.6
Guaranteed	0.3	0.2	0.2	0.2	0.2
Total	88.7	95.9	103.5	109.1	112.7

*AHL Institutional Solutions invests into a range of AHL strategies including AHL Dimension, AHL Alpha and AHL Evolution

FUM by investment engine

$bn	31-Mar-17	30-Jun-17	30-Sep-17	31-Dec-17	31-Mar-18
AHL	19.4	19.8	22.0	24.0	23.8
AHL Dimension	5.2	5.1	5.7	5.9	5.3
AHL Alpha	4.2	4.2	4.0	4.4	4.1
AHL Evolution	3.0	3.3	3.4	3.7	3.4
AHL Diversified (inc. Guaranteed)	3.3	3.2	3.1	3.1	3.1
AHL Institutional Solutions*	1.2	1.4	2.2	2.6	2.7
AHL other	1.8	2.0	1.8	1.8	1.6
Diversified risk premia	0.7	0.6	1.8	2.5	3.6
Numeric	25.4	28.0	30.9	31.9	32.7
Global	13.0	14.9	15.9	16.0	15.4
Emerging markets	5.3	5.7	6.5	6.7	7.6
US	4.5	4.5	4.4	4.1	3.9
Numeric absolute return	1.9	1.9	1.8	1.9	1.9
Diversified risk premia	0.7	1.0	2.3	3.2	3.9
GLG	28.8	31.2	32.9	35.0	37.9
Alternatives	12.5	13.4	13.5	14.6	16.3
GLG Equity absolute return	3.6	3.6	3.4	3.8	5.5
EM total return	2.0	3.4	3.9	4.4	4.5
GLG Credit absolute return	1.8	1.5	1.4	1.6	1.3
CLO	4.4	4.3	4.2	4.2	4.4
Multi-strategy	0.7	0.6	0.6	0.6	0.6
Long only	16.3	17.8	19.4	20.4	21.6
Japan equity	7.3	7.9	8.5	9.7	9.5
Europe equity	1.0	1.3	1.9	2.0	2.4
US equity	1.3	1.1	1.2	1.2	1.2
Convertibles	2.3	2.5	2.5	2.2	2.0
UK equity	0.8	1.0	1.2	1.5	1.8
Other equity	0.9	1.0	1.0	1.0	1.0
Multi Asset	1.2	1.1	1.1	1.0	1.1
Fixed income	1.5	1.9	2.0	1.8	2.6
FRM	13.2	14.9	15.5	16.0	16.2
Infrastructure & Direct Access	5.5	7.4	7.1	7.7	7.7
Segregated	4.5	4.7	5.8	6.0	6.3
Diversified and thematic FoHF	3.2	2.8	2.6	2.3	2.2
GPM	1.9	2.0	2.2	2.2	2.1
Total	88.7	95.9	103.5	109.1	112.7

*AHL Institutional Solutions invests into a range of AHL strategies including AHL Dimension, AHL Alpha and AHL Evolution

		Total Return		Annualised Return
Investment Performance		Last 3 months	Last 12 months	3 years	5 years	Since Inception
Absolute return
AHL Dimension	1	-4.2%	-0.3%	0.7%	3.4%	4.9%
AHL Alpha	2	-3.0%	3.0%	-1.8%	3.4%	11.1%
AHL Evolution	3	-4.0%	10.1%	4.2%	11.1%	13.6%
AHL Diversified	4	-5.9%	0.6%	-6.4%	2.1%	11.3%
Numeric Alternative Market Neutral	5	-1.0%	-3.3%	1.3%	3.5%	3.8%
GLG European Long Short Fund	6	3.8%*	10.5%*	3.7%*	3.0%*	7.8%*
Man GLG European Mid-Cap Equity Alternative	7	2.9%	7.5%	7.0%	n/a	7.0%
Man GLG Global Credit Multi Strategy	8	2.5%*	10.2%*	10.1%*	5.5%*	12.8%*
Man Multi-Strategy Fund	9	1.4%*	9.1%*	4.3%*	3.6%*	4.6%*
Total return
Man Alternative Risk Premia SP	10	0.2%	10.7%	n/a	n/a	7.8%
Man GLG Global EM Debt Total Return	11	-1.3%	-2.0%	n/a	n/a	3.5%
Multi-manager solutions
FRM Diversified II	12	0.3%*	3.9%*	-0.1%*	1.8%*	4.2%*
Systematic long only
Numeric Global Core		-2.0%	15.4%	9.8%	12.9%	12.9%
Relative Return	13	-0.7%	1.8%	1.8%	3.2%	3.2%
Numeric Europe Core (EUR)		-2.0%	4.1%	4.3%	11.8%	9.3%
Relative Return	14	2.3%	4.6%	4.2%	4.5%	3.1%
Numeric Emerging Markets Core		3.4%	29.6%	14.1%	n/a	9.9%
Relative Return	15	1.9%	4.7%	5.3%	n/a	4.3%
Discretionary long only
Man GLG Japan Core Alpha Equity Fund	16	-6.9%	9.3%	4.9%	13.1%	4.5%
Man GLG Continental European Growth Fund	17	1.2%	14.5%	18.1%	18.2%	9.6%
Man GLG Global Convertible	18	0.6%	3.5%	2.6%	4.0%	5.7%
Man GLG Undervalued Assets Fund	19	-4.0%	15.4%	10.8%	n/a	11.0%
Indices
HFRX Global Hedge Fund Index	20	-1.0%	3.2%	0.5%	1.3%
HFRI Fund of Funds Conservative Index	20	0.7%	3.6%	1.7%	3.0%
Barclay BTOP 50 Index	21	-2.6%	-1.7%	-4.5%	0.3%
HFRI Equity Hedge (Total) Index	20	0.7%	9.8%	5.3%	5.7%
HFRX EH: Equity Market Neutral Index	20	0.7%	1.0%	0.3%	1.5%

 

Investment performance (Cont'd) 1.         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. 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 Evolution Limited adjusted for the fee structure (2% p.a. management fee and 20% performance fee) from September 2005 to 31 October 2006; and 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 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. 5.         Numeric market neutral 6.         Represented by GLG European Long Short Fund - Class D Restricted - EUR until 29 June 2007. From 1 July 2007 the performance of GLG European Long Short Fund - Class D Unrestricted is displayed. 7.         Represented by Man GLG European Mid-Cap Equity Alternative IN H USD. 8.         The inception date of the fund, Man GLG Global Credit Multi Strategy, was 16 January 1998. Performance data is shown using Restricted IL XX USD (previously Z) share class up until inception of Unrestricted IL XX USD (previously Z) share class on 31 August 2007, from which point performance is shown using this share class.                      9.         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. 10.       Represented by Man Alternative Risk Premia Class A USD. 11.       Represented by Man GLG Global Emerging Markets Debt Total Return Class I USD. 12.       Represented by FRM Diversified II Fund SPC - Class A USD ('the fund') but prior to Jan 2004, FRM has created the FRM Diversified II pro forma using the following methodology: i) for the period Jan 1998 to Dec 2003, by using the returns of Absolute Alpha Fund PCC Limited - Diversified Series Share Cell ('AA Diversified - USD') adjusted for fees and/or currency, where applicable. For the period Jan 2004 to Feb 2004, the returns of the fund's master portfolio have been used, adjusted for fees and/or currency, where applicable. Post Feb 2004, the fund's actual performance has been used, which may differ from the calculated performance of the track record. There have been occasions where the 12-months' performance to date of FRM Diversified II has differed materially from that of AA Diversified. Strategy and holdings data relates to the composition of the master portfolio. 13.       Performance relative to the MSCI World. This reference index 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. 14.       Performance relative to the MSCI Europe (EUR). This reference index 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. 15.       Performance relative to MSCI Emerging Markets. This reference index 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. 16.       Represented by Man GLG Japan CoreAlpha Fund - Class C converted to JPY until 28 January 2010. From 1 February 2010 Man GLG Japan CoreAlpha Equity Fund - Class I JPY is displayed. 17.       Represented by Man GLG Continental European Growth Fund Class C Accumulation Shares. 18.       Represented by Man GLG Global Convertible - Class IL T USD until 7 June 2009. From 8 June 2009 the performance of Man GLG Global Convertible - Class IM USD is displayed. 19.       Represented by Man GLG Undervalued Assets Fund - C Accumulation Shares. 20.       HFRI and HFRX index performance over the past 4 months is subject to change. 21.       The historic Barclay BTOP 50 Index data is subject to change.         Past or projected performance is no indication of future results. Financial indices are used for illustrative purposes only and are provided for the purpose of making a comparison to general market data as a point of reference and should not be construed as a true comparison to the strategy. 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. *Estimate

 

Enquiries

Fiona Smart

Head of Investor Relations

[phone]

[e-mail] 

Rosanna Konarzewski

Global Head of Communications & Marketing

[phone]

[e-mail] 

Michael Turner

Finsbury

[phone]

[e-mail]

About Man Group

Man Group is a global active investment management firm, which runs $112.7 billion* of client capital in liquid and private markets, managed by investment specialists based around the world. Headquartered in London, the firm has 15 international offices and operates across 25 jurisdictions. Our business has five specialist investment engines, which represent the range of our capabilities: Man AHL, Man Numeric, Man GLG, Man FRM and Man GPM.

These engines house numerous investment teams, working collaboratively within the framework of Man Group, with a high degree of investment autonomy. Each team benefits from the strength and resources of the firm's single operating platform, enabling their primary focus to be seeking to generate alpha for clients. The teams invest across a diverse range of strategies and asset classes with highly specialised approaches, with long only and alternative strategies run on a discretionary and quantitative basis in single and multi-manager formats. Our clients are at the heart of everything we do and we engage in close dialogue with our investors as strategic partners, to understand their particular needs and constraints. Man Group's investment teams are empowered and supported by our institutional infrastructure and technology, which aims to facilitate the most efficient exposure to markets and effective collaboration across the organisation.

Through the Man Charitable Trust and sponsorship of the Man Booker Prizes, Man Group is committed to promoting literacy and numeracy on a global scale, and to supporting charitable causes more broadly.

Man Group plc is listed on the London Stock Exchange under the ticker EMG.LN and is a constituent of the FTSE 250 Index. Further information can be found at www.man.com.

*As at 31 March 2018. All investment management and advisory services are offered through the investment "engines" of Man AHL, Man Numeric, Man GLG, Man FRM and Man Global Private Markets (GPM).

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 or to invest in any investment products mentioned herein.

This announcement contains inside information.

 

END

 

 

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