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RNS Number : 2360M
Charlemagne Capital Limited
19 January 2016
 

19 January 2016                                               

 

 

Charlemagne Capital Announces Unaudited Revenues and Assets under Management
("AuM") for the year ended 31 December 2015 and change to the board of directors

 

Charlemagne Capital Limited ("Charlemagne" or the "Group") today issues a trading update for the year ended 31 December 2015 in advance of the results announcement scheduled for 15 March 2016.

 

Key highlights for the 12 months ended 31 December 2015

 

·     Group AuM US$1.90 billion, an increase of 2.0% in the quarter, a decrease of 15.6% over the full year.

·     Net management fees for the year were US$20.7 million, down 19.8%.

·     Net performance fees for the year were US$4.3 million, up 79.2%.

·     Total revenue for the year was US$25.2 million, down 11.6% on the prior year.

·     Interim dividends of 0.5 US cents in respect of 2014 and 0.5 US cents in respect of 2015 have been paid during the year.

·     Strong balance sheet maintained and intention to declare a year-end dividend

 

Key Financial data for the year ended 31 December 2015

 

The key financial data for the financial year which ended on 31 December 2015 are set out below. 

 

Unaudited revenue numbers for the year and net asset position

 

 

 

Operational income

Year ended

31 December 2015 (unaudited)

Year ended

31 December 2014 (audited)

Six months ended

31 December 2015 (unaudited)

Six months ended

31 December 2014

(unaudited)


US$m

US$m

US$m

US$m

Net management fees

20.7

25.8

10.0

13.3

Net performance fees

4.3

2.4

3.6

2.1

Other income

0.2

0.3

(0.1)

(0.1)

Total revenue

25.2

28.5

13.5

15.3

 

Management fees for the year include US$8.8 million earned from OCCO (2014: US$11.2 million). Performance fees crystallised in 2015 were US$2.2 million earned from OCCO (2014: US$ 0.02 million) and US$2.1 million from other funds (2014: US$ 2.4 million).

 

As at 31 December 2015, the Group has unaudited net assets of approximately US$23 million (2014: US$24 million) which include cash balances of approximately US$17 million (2014: US$17 million) and current asset investments of approximately US$7 million (2014: US$7 million).

 

 

Group AuM as at 1 January 2016(i)

 

The table below shows the distribution of the Group's AuM across its product ranges as at 1 January 2016 and the movements experienced during the year for 2015.

 


02-Jan-15

Net Subscriptions

Net Performance

01-Jan-16

Movement In


AuM (US$m)

(US$m)

(%)

(US$m)

(%)

AuM (US$m)

Period (%)

Magna

654

(36)

(5.5)

(110)

(17.3)

508

(22.3)

OCCO

525

(49)

(9.3)

17

3.4

493

(6.1)

Institutional

966

(47)

(4.9)

(114)

(12.1)

805

(16.7)

Specialist

103

(3)

(2.9)

(9)

(8.9)

91

(11.7)

Total

2,248

(135)

(6.0)

(216)

(9.9)

1,897

(15.6)

 

(i)  Data is reported as at the first business day of the following period in order to capture all subscription and redemption orders placed during the period but not processed until the next dealing date for the funds concerned. AuM data is net of any crossholdings and is unaudited and may be subject to adjustment during the audit process.

(ii) The percentage for net performance is calculated based upon the average AuM for the year.

 

Exceptional item

As reported in the interim financial statements, during the year the Group reached an agreement with HMRC under the terms of the Employee Benefit Trust ("EBT") Settlement Opportunity.  This resulted in the resolution of all outstanding protective assessments and potential claims for tax and national insurance raised by HMRC in respect of the EBT.  The Group has received corporation tax relief in respect of contributions it had paid to the EBT in earlier years that had previously not been allowed as a deductible expense.  It is expected that the resulting net credit of US$3.2 million will be included as an exceptional revenue item within the tax charge of the Group for this financial year.

Comment

Commenting on 2015 trading Chief Executive, Jayne Sutcliffe said: "Despite the continuing headwinds in emerging markets Charlemagne's investment performance continues to be strong. All eight of our Magna mutual funds delivered top half performance with four of our funds in the top quartile over three years, while the OCCO long-short fund produced another positive year in Dollar terms.

 

"As the asset class overall continues to see net outflows, we are encouraged by the net inflows that we experienced in the second half of the year and remain optimistic for the longer term prospects of our business."

 

Summary

 

Emerging markets ended 2015 with a loss for the year as a whole with the MSCI Emerging Markets Index down 14.92% on a net basis in US$ following a volatile third quarter which saw the index fall by over 15%.     

 

Once again there have been substantial net outflows from the industry asset class over the year with total outflows at roughly double the level experienced in each of the two preceding years.

 

By comparison, the Group has seen net inflows over the second half of the year and as previously reported, net outflows over the first half were predominantly due to the rebalancing of an existing institutional mandate which also had a large cross holding in Magna.  In total this mandate accounted for an outflow of US$182 million. 

 

In a difficult environment for our asset class, Charlemagne's investment performance has been consistently strong.  Over the last three years, all eight of the Magna mutual funds have been in the top half of their Morningstar ratings, with four in the top quartile.  Last year, we had four in the first quartile, two in the second and only one in the fourth.  The OCCO long-short fund produced another positive year in Dollar terms, despite weakness in the underlying markets and the continued strength in the greenback.  In our view this is largely due to the quality of our investment team and process. 

 

The already challenging trading environment for the Group became increasingly difficult during the second half of the year with lower average AuM and management fee income than in the first six months.   However, the contribution from performance fees in the period will have helped substantially to mitigate the increase in retained losses resulting from the fall in recurring income. 

 

Dividend

 

In the absence of unforeseen circumstances, the Group intends to declare a second interim dividend in respect of the year ended 31 December 2015 at the same level as the first interim dividend already paid in respect of this financial year.  The directors have taken the view that, given the unprecedented conditions encountered during the year and the strength of the Group's balance sheet, it would be appropriate to support the amount declared from reserves.

 

Change to board of directors

 

Adrian Jones, Executive Director, Operations will be stepping down from the Board on 31 January 2016.  Mr Jones, who is reducing his commitment to the Group for family reasons, will retain a part-time role within the Group and will remain a non-executive director of its Isle of Man operating subsidiary and of certain Charlemagne-managed funds.   His day to day responsibilities as Director, Operations have been reallocated internally among the remaining Executive Directors and other senior members of staff in the Isle of Man. 

 

Chief Executive, Jayne Sutcliffe, said: "I would like to thank Adrian for his huge contribution to the operational efficiency and effectiveness of the Group over many years and am very pleased that he will remain associated with the Group and its funds in a non-executive capacity."

 

Enquiries:

 

Charlemagne Capital


Jayne Sutcliffe, Chief Executive

Tel. 020 7518 2100

Lloyd Jones, Chief Financial Officer

Tel. 01624 640200

 

Smithfield Consultants

Tel. 020 7360 4900

John Kiely


Ged Brumby




N+1 Singer

Tel. 020 7496 3000

Nic Hellyer


Gillian Martin


 

 

 

This announcement is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States of America, Australia, Canada, Japan or South Africa or any other jurisdiction into which the release, publication or distribution would be unlawful. Any failure to comply with this restriction may constitute a violation of United States, Australian, Canadian, Japanese, South African or other securities law. The distribution of this announcement in jurisdictions other than the United Kingdom may be restricted by law and persons into whose possession this announcement comes should inform themselves about and observe any such restrictions.

 

This announcement contains (or may contain) certain forward-looking statements with respect to the financial condition, results of operations and businesses of the Group. These statements and forecasts are based on Charlemagne's beliefs, assumptions and expectations of the Group's future performance. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to Charlemagne at the date of this announcement or are within its control, that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements. Data or statements contained in this announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Nothing in this announcement should be construed as a profit forecast or to imply that the earnings of the Company for the current or future financial years will necessarily match or exceed the historical or published earnings of the Group.

 

This announcement is for information purposes only and shall not constitute an offer to buy, sell, issue or subscribe for, or the solicitation of an offer to buy, sell, issue, or subscribe for, any securities in Charlemagne or any other entity. This announcement is aimed at providing information regarding the Assets under Management on which revenue is derived by Charlemagne. The unaudited data contained in this announcement are currently provisional and all such data are subject to change without notice and, except as required by applicable law, neither Charlemagne nor N+1 Singer assumes any responsibility or obligation to update publicly or review any of the data or statements contained herein.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
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