Man Group profits fall in 'difficult' year

Man Group reported lower profits as the British hedge fund manager oversaw a small decline in assets under management in 2018 after $7.7bn in investment losses.

Assets under management edged down 0.5% to $108.5bn for the year ended 31 December, sending Man's performance fees south 81% to $34m.

The FTSE 250 resident welcomed $10.8bn in new client money in 2018, but the investment losses and currency and other losses of $3.7bn hit the group where it hurt.

Man's adjusted pre-tax profits fell to $251m from the $384m recorded a year earlier, as losses in its GLG discretionary trading and its computer-driven Numeric Alternatives saw double-digit falls in its European and emerging markets-focused funds.

Chief executive Luke Ellis said: "2018 was a more difficult year for the asset management industry, characterised by periods of higher volatility which impacted performance across asset classes and investment styles.

"Looking ahead, we have had a healthy number of new mandate wins but as clients respond to changes in the market and adjust their portfolios we have also seen a pick-up in redemptions."

Ellis said he remained confident the group was "structurally well positioned for the future", though the board proposed a final dividend of 4.06p, down from the 4.18p declared a year earlier.

Analysts at Canaccord Genuity highlighted some likely downside pressure on the group moving forward.

The Canadian broker said: "We feel the valuation is too high given the current risk to forecasts and cautious outlook."

As of 0945 GMT, Man Group shares had fallen 4.96% to 131.30p.