F&C reports £7.2bn net outflows in 2011

London-based F&C Asset Management has reported £7.2bn of net outflows for 2011, during a tough year for the group as activist investor Edward Bramson seeks to turnaround the firm’s fortunes.

The outflows weighed on the group’s assets under management, which declined 5.4% over the year to £100.1bn.

F&C attributed the fall in outflows and AUM to withdrawals from its strategic partners business.

This also played its part in the firm reporting a decline in underlying operating profit, from £67.2m to £65.2m.

However, net revenues increased from £243.2m in 2010 to £267m last year, predominantly due to the inclusion of Thames River for the full year.

The group added gross new third-party business from institutional clients has risen to £7.8bn from £5.7bn.

Edward Bramson, executive chairman, last October announced the group would embark on a programme to reduce its soaring debt levels.

Bramson laid out plans in the first part of his strategic review to decrease costs by £33.2m, including 70 job cuts across the business.

In the annual results, Bramson said his strategy has been well received by clients and has resulted in the group’s net debt falling from £95.9m to £77.8m.

“2011 was a significant year for F&C, with the development of a new strategy which has been well received by clients, consultants and shareholders,” said Bramson.

“Against a tough market backdrop, F&C had reassuring net inflows from third-party institutional clients during the year and investment performance remained competitive.

“Encouragingly, consultant buy ratings are now at record levels as we gained further recognition for our core institutional expertise.”

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