Quilter quick out of the block with special divi after maiden results

Quilter celebrated a strong first set of results since spinning out of Old Mutual by paying shareholders a 12p special interim dividend.

The FTSE 250 group, which was known as Old Mutual Wealth Management until it was de-merged from its Anglo-South African parent in June, said it would no be making a normal interim dividend payment but would pay out £221m surplus proceeds from the £576m sale of the Single Strategy asset management business, which completed at the end of June followed by the repayment of a £300m loan.

Quilter's core business grew assets under management and administration 1.8% to £116.5bn from the end of December to the end of June, as a result of inflows of £2.2bn and slightly weaker overall market performance, down £0.1bn.

The second quarter of the year saw a slower net flows of just £0.6bn, across each area of the business. Furthermore, the company revealed that since the listing 12 investment managers had resigned, which "may lead to higher than trend outflows in 12 to 18 months’ time".

Total revenue was £385m, of which net management fees were £319m, feeding down to adjusted profits before tax that increased 16% to £110m compared to a year ago, and beat the consensus forecast of £107m. The reported PBT from continuing operations of £17m was up 240% on last year.

Diluted adjusted earnings per share at 5.5p, up 25%, while statutory diluted EPS came out at 18.7p, up from 5.1p a year ago.

Chief executive Paul Feeney said these first reported results since listing separately on the London and Johannesburg stock exchanges "demonstrate the strength of the Quilter business model".

He added: "We are focused on delivering what our customers want, an integrated wealth management offering that delivers good outcomes through the cycle. Our market offers significant growth opportunities and, while we have built a leading wealth management business, we are someway from demonstrating its full potential. Our priority now is to optimise the way we work to maximise the value of our integrated business for all our stakeholders over the coming years."

Shares in Quilter rose 1.5% to 151.86p in the first hour and a half of trading on Wednesday.

Broker Numis said that on the positive side, the company is going to pay a special dividend larger thank its 7.9p estimate and slightly earlier than expected.

However, AuMA at £116.5bn was a little weaker than the £118.2bn analysts had expected, mostly reflecting a slowdown in net flows in the second quarter across all areas.

UBS said the 12 IM resignations "surprised us" and with the possibility that this may dent flow of investors' money left analysts "concerned about the flow outlook".