Interim Management Statement

RNS Number : 5070A

Liontrust Asset Management PLC

02 February 2011

 



Embargoed until 7am on 2 February 2011

Stock Exchange Announcement

LIONTRUST ASSET MANAGEMENT PLC

Interim Management Statement and Directorate Changes

Liontrust Asset Management PLC ("Liontrust", the "Company", or the "Group"), the specialist independent fund management group, is today issuing its Interim Management Statement for the period from 1 October 2010 to 31 December 2010 (the "Interim Period") as required by the FSA's Disclosure and Transparency Rules.

Funds under Management

Liontrust recorded positive net sales of £76 million in the Interim Period, the second successive quarter in which the Company has had positive net sales. This brought total positive net sales from 1 July to 31 December 2010 to £86 million. Positive net sales have continued into the final quarter of the financial year, reaching £32 million for the period from 1 January to 1 February 2011. Positive net sales for the financial year to date were £73 million.

On 31 December 2010, our assets under management stood at £1,292 million and were broken down by type and process as follows:-

Process	Total (£m)	Institutional (£m)	Retail (£m)	Offshore Funds (£m)
Cashflow Solution	865	382	462	21
Economic Advantage	299	0	299	0
Fixed Income	70	0	0	70
Indexed	58	0	58	0
Total	1,292	382	819	91

This represented an increase of 14.6% over the Interim Period. Assets under management as at 1 February 2011 were £1,307 million.

Funds Flows

A reconciliation of fund flows and assets under management over the Interim Period is as follows:-

	Total	Institutional	UK Retail	Offshore Funds
	(£m)	(£m)	(£m)	(£m)
Opening AuM - 1 Oct 2010	1,128	326	735	67
Inflows	130	40	60	30
Outflows	(54)	(15)	(31)	(8)
Net flows	76	25	29	22
Market movement	88	31	55	2
Closing AuM - 31 Dec 2010	1,292	382	819	91

Performance fees

Performance fees of £816,000 were earned in the Interim Period. Accordingly, in the financial year to 31 December 2010, £1.013 million were earned (1 April 2009 to 31 December 2009: £3.332 million).

Fund Performance (Quartile ranking)

Retail Funds	3 months	1 year	Manager tenure	Manager appointed
Liontrust Income Fund	3	2	1	25/03/2009
Liontrust UK Growth Fund	4	1	2	25/03/2009
Liontrust Special Situations Fund	1	1	1	11/11/2005
Liontrust UK Smaller Companies Fund	3	3	1	08/01/1998
Liontrust European Absolute Return Fund	1	2	4	09/07/2009
Liontrust European Growth Fund	1	1	1	15/11/2006
Liontrust Pan-European Fund	1	1	1	01/06/2007

Source: Financial Express, total return, to 31 December 2010, past performance is not a guide to the future.

Note: The above funds are all authorised unit trusts, other than Liontrust Pan-European Fund, which is a sub-fund of the Group's  Luxembourg domiciled SICAV.

Sales & Marketing

As highlighted in previous announcements, Liontrust implemented a more proactive and targeted sales and marketing strategy in the second half of 2010 that has been designed to raise the profile of the Company and our fund performance, to engage more actively with clients and to broaden the client base. The initial success of this strategy has been reflected in the net inflows the Company has generated for the past two quarters and for the first month of the final quarter of the financial year.

As part of this strategy, Liontrust held its first investment conference on 20 January 2010. This enabled our three fund management teams to present to around 100 institutional and intermediary clients and potential clients. The high quality of the attendees reflected the increased interest in Liontrust since the Company implemented the new sales and marketing strategy. The conference was filmed, which will be used to market our funds to the wider investment market.

Liontrust has also been making progress in getting its funds back on to the buy and recommended lists of wealth managers and leading intermediary firms. For example, the Liontrust Special Situations Fund has joined the Liontrust European Absolute Return Fund on Hargreaves Lansdown's influential Wealth 150 list.

The print and online advertising campaign has continued into 2011. The campaign is initially focusing on the Liontrust UK equity fund range. The range has excellent long-term performance and we believe UK equities will prove to be a more attractive asset class for investors in 2011.

We are also confident about the marketability of our other funds. The Liontrust European Growth fund, for example, has very strong performance over a range of time periods and it is likely that allocations to Continental European equities will also rise this year. At a time of uncertainty for the corporate bond market, partly because of rising inflation and the potential for interest rates to be increased, we believe there will be greater interest in our long/short credit funds as a way of trying to hedge against such risks.

Financial Services Compensation Scheme ("FSCS")

In the past year, the FSCS has seen a significant increase in the volume and value of investment claims, relating to Keydata Investment Services Limited, Wills & Co and other failed investment intermediary firms.

In November 2010, the FSA advised that there was a real possibility that it may need to raise significant funds to pay compensation, which could trigger a cross subsidy. The FSA has now confirmed that this is the case and that it will require a further £233m from firms in investment fund management. The amount of the FSCS 2010/11 Interim Levy invoiced by the FSA to Liontrust is £415,000, which is payable before the end of the current financial year and will be treated as an exceptional item in the Group's financial statements. This compares to the levy for the previous financial year of £20,000.

Directorate changes

Subject to FSA approval, Alastair Barbour will join the board on 1 April 2011 as an independent non-executive director and Chairman of the Audit Committee. Mr Barbour is a chartered accountant with 25 years' experience spent auditing and advising boards and management of public companies in the UK and internationally, principally in the financial services industry.  He trained with Peat, Marwick, Mitchell & Co in London before being admitted as a partner with KPMG in Bermuda in 1985. Alastair returned to the UK as a partner of KPMG in 1991 and has specialised in financial services with extensive experience in advising on accounting, financial reporting and corporate governance.

Current directorships - None.

Other directorships in the previous five years - None.

The Company confirms that there are no further matters to be disclosed pursuant to the requirements of paragraph LR 9.6.13 R of the Listing Rules of the UK Listing Authority.

Chris Edmeades has notified the Board of his intention to resign as Chief Risk Officer of the Company to pursue a career overseas. Chris steps down from the Board with immediate effect although he will remain with Liontrust until 31 March 2011 to assist in an orderly transfer of his responsibilities. Vinay Abrol, Chief Operating Officer and Chief Financial Officer, will assume responsibilities for risk and compliance. Following his departure from Liontrust, Chris will continue as a director, in a non-executive capacity, of the Group's offshore subsidiary company, Liontrust International (Guernsey) Limited, and its offshore fund companies: Liontrust Guernsey Fund Limited, Liontrust Alternative Funds PCC Limited, Liontrust Credit Master Fund Limited, Liontrust Credit Fund Limited and Liontrust International Funds (Luxembourg) SICAV.

Adrian Collins, Chairman of Liontrust, said: "Chris joined the Company in 2002 and has made a valuable contribution to its development as Head of Risk and, latterly, as our Chief Risk Officer. On behalf of the Board, I would like to thank Chris for his hard work and commitment to the Company and wish him all the best for the future and we look forward to continuing to work with Chris, in a non-executive capacity, with our offshore entities."

Liontrust Senior Incentive Plan

Liontrust announces that, under the Liontrust Senior Incentive Plan as approved by the shareholders of the Company in general meeting on 13 January 2011, it granted on 1 February 2011 options over ordinary shares in the Company to the following executive directors:

Adrian Collins - options over 1,000,000 ordinary shares of the Company with an exercise price of 1p per share and an exercise period between 1 February 2014 and 31 January 2021. The total number of ordinary shares over which options are held by Adrian following this notification is 1,000,000.

John Ions - options over 1,800,000 ordinary shares of the Company with an exercise price of 1p per share and an exercise period between 1 February 2014 and 31 January 2021. The total number of ordinary shares over which options are held by John following this notification is 2,000,000.

Vinay Abrol - options over 200,000 ordinary shares of the Company with an exercise price of 1p per share and an exercise period between 1 February 2014 and 31 January 2021. The total number of ordinary shares over which options are held by Vinay following this notification is 200,000.

Full Year trading update

A trading update for the financial year ending 31 March 2011 will be released on 30 March 2011.

Outlook

The restructuring of the business last year to produce a streamlined and better focused Liontrust has already begun to produce results. Liontrust has had net positive sales in the past two quarters and since the start of 2011. We are confident this upturn will continue because of the excellent long-term performance of our funds (five of Liontrust's seven Retail Funds are in the first quartile of their respective sectors since launch or the current fund managers started running the funds) and the more proactive, targeted and engaging sales and marketing strategy we have implemented. We also believe we will benefit from greater investor interest in UK and European equities and managing long/short credit strategies in the current economic and market environment.

For further information please contact:

Liontrust Asset Management PLC                            020 7412 1700

John Ions                                                                             www.liontrust.co.uk

Vinay Abrol

Simon Hildrey - Head of Marketing & Communications

Altium                                                                                  020 7484 4040

Sam Fuller

Paul Chamberlain

Forward Looking Statements

This announcement contains certain forward-looking statements with respect to the financial condition, results of operations and businesses and plans of the Group. These statements and forecasts involve risk and uncertainty because they relate to events and depend upon circumstances that have not yet occurred. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements and forecasts. As a result, the Group's actual future financial condition, results of operations and business and plans may differ materially from the plans, goals and expectations expressed or implied by these forward-looking statements.  Liontrust undertakes no obligation publicly to update or revise forward-looking statements, except as may be required by applicable law and regulation (including the Listing Rules of the Financial Services Authority).  Nothing in this announcement should be construed as a profit forecast or be relied upon as a guide to future performance.

Other information

The release, publication, transmission or distribution of this announcement in, into or from jurisdictions other than the United Kingdom may be restricted by law and therefore persons in such jurisdictions into which this announcement is released, published, transmitted or distributed should inform themselves about and observe such restrictions. Any failure to comply with the restrictions may constitute a violation of the securities laws of any such jurisdiction.

ENDS

 

END

 

 

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