ABERDEEN ASSET MANAGEMENT PLC

RESULTS FOR THE YEAR TO 30 SEPTEMBER 2016 (AUDITED)

Highlights

·    Net revenue is down 14% to £1,007.1 million (2015: £1,169.0 million)

·    Underlying profit before tax decreased to £352.7 million (2015: £491.6 million)

·    Strong year-end net cash position of £548.8 million (2015: £567.7 million)

·    Final dividend of 12.0p per share (2015: 12.0p), making 19.5p for the full year (2015: 19.5p)

·    AuM £312.1 billion (2015: £283.7 billion)

·    Product diversification and cost discipline progress in line with strategy

Martin Gilbert, Chief Executive of Aberdeen Asset Management commented:

"These financial results reflect, in part, our diversified business model and strict cost management. Economic and political newsflow has weighed on investor sentiment and as expected has led to further outflows from our business.

"Structural themes including fee pressure, technological innovation and greater regulatory requirements are a focus for all asset managers. Aberdeen's broad range of investment capabilities and global distribution platform means we are well placed to address these challenges and also benefit from the opportunities they create. By continuing to invest in the business and by being a good steward of our customers money we are committed to helping our investors - from individuals through to institutions - achieve their financial goals."

Management will host a presentation for analysts and institutions today at 09:30 (UK) to be held at the offices of Aberdeen Asset Management, Bow Bells House, 1 Bread Street, London EC4M 9HH. The event will also be available to view via a live webconference. To register please use the following weblink: http://edge.media-server.com/m/p/9atacmxa

For more information:

Aberdeen Asset Management

Martin Gilbert, Chief Executive   + 44 (0) 207 463 6000

Bill Rattray, Finance Director      + 44 (0) 207 463 6000

Maitland

Neil Bennett     + 44 (0) 207 379 5151

Chairman's statement

I am pleased to present my first statement as Chairman, following Roger Cornick's retirement on 30 September.

The early part of 2016 saw the continuation of the volatile and challenging market conditions experienced in 2015. In part, our exposure to developed market equities, fixed income and property assets cushioned us from some of this volatility. By mid-year, sentiment rallied strongly. The benefits of improved markets, especially for our emerging market and Asian focused asset classes, and the depreciation of sterling supported assets under management ("AuM") and profit for the year.

Recognising that markets and investor sentiment may continue to fluctuate, we have remained resolute on the objectives that we outlined last year: diversification of our business, cost management and cash management, and these will remain in focus in 2017.

We ended the year with AuM of £312.1 billion, an increase of 10% over September 2015. The acquisitions of FLAG Capital Management ("FLAG"), Arden Asset Management ("Arden"), Advance Emerging Capital Ltd ("Advance") and Parmenion Capital Partners LLP ("Parmenion") have brought wider capabilities and resource to our alternatives business, as well as the opportunity to develop our digital distribution capacity to meet the future needs of our clients. Alongside alternatives, we have continued to promote our multi asset capability with the launch of several new funds.

Our investment teams have remained dedicated to following our fundamental investment processes in pursuit of consistent long term performance and we have seen a recovery in equity performance. However, the US election is another in a series of political events which continue to impact markets.

Net outflows were £32.8 billion, which included £8 billion of multi asset and quantitative investment outflows from lower margin insurance books, some of which are in long-term run-off. The level of equities outflows declined steadily throughout the year, although we do still expect some fluctuation from quarter to quarter. We will have outflows in the first quarter of 2017 from two lower margin, but large blocks of AuM. It has been pleasing to see more positive investor sentiment towards emerging markets as the year progressed and, while industry flows have initially favoured passive and Exchange Traded Funds ("ETF") strategies, we saw healthy net inflows to our emerging markets equities in the final quarter.

We have maintained tight control of costs throughout the year and are well advanced in our programme to achieve longer term efficiencies. We had implemented £50 million of annualised savings by the year end and remain on track to achieve the full £70 million target by March 2017. The balance sheet remains strong with healthy levels of cash generation which has enabled the Board to propose an unchanged dividend for the year.

The management team has been strengthened with a number of highly regarded external appointments, including Campbell Fleming who joined the Group as Global Head of Distribution just before the year-end. Hugh Young has taken on the role of Head of Investment, with responsibility for the oversight of the entire investment division across all asset classes.

Financial highlights

Net revenue for the year of £1,007.1 million was 14% lower than in 2015; recurring management fee income was also 14% lower, while performance fees increased slightly to £15.8 million (2015: £13.5 million). The blended average management fee rate was 33.6 basis points.

We have implemented the first £50 million of our cost efficiency programme during the year and, on a constant currency basis, the phasing of these savings has reduced 2016 costs by £28 million, thus negating the additional costs introduced by the FLAG, Arden, Advance and Parmenion acquisitions. However, the effect of sterling weakness has increased our overseas costs, such that, overall, costs have increased by 1%.

Conversion of underlying operating profit to cash has remained robust with core operating cash flow of £362.9 million (2015: £531.7 million), representing a conversion rate of 111% (2015: 107%). The balance sheet remains strong with a year-end net cash position of £548.8 million (2015: £567.7 million) and, despite an increase in the requirement during the year, we retain healthy headroom above our regulatory capital requirement.

The blended fee rate has reduced from 36.1bps to 33.6bps. This is principally due to product mix, given outflows from higher margin equities, emerging market debt and high yield products and inflows into money market funds. Fee margins within individual investment capabilities remain constant year-on-year.

As a consequence of lower revenues, underlying earnings per share were 20.7p, compared to 30.0p in 2015.

Dividend

The Board is recommending a final dividend of 12.0p per share, making a total payment for the year of 19.5p per share, which is unchanged from 2015. The final dividend will be paid on 9 February 2017 to qualifying shareholders on the register at 9 December 2016.

Acquisitions

During the year we completed the acquisitions of Arden, Advance and Parmenion adding £9.5 billion of assets under management. Arden and Advance, together with FLAG which was completed in August 2015, have been integrated with Aberdeen's wider alternatives business.

Parmenion will continue to operate as a distinct business under our ownership, as part of our strategy to capitalise on advancements in financial technology systems and to become a leader in using technology to provide investors with portfolios appropriate to their needs.

Investment review

Whilst this has been another tough year for flows overall, the mix effect of these outflows has varied within strategies and asset classes from 2015 when we saw significant outflows from equities mainly due to macroeconomic factors towards Asia and emerging markets.

Equity net outflows have reduced to £13.6 billion this year from £16.4 billion in 2015, with much of the improvement being in the second half year. Emerging market equities recorded a small net inflow of £0.6 billion for the final quarter, albeit negative for the year overall with net outflows for the year of £0.8 billion (2015: £4.0 billion). We have also been encouraged by new business wins with growing traction from broader based asset classes into diversified growth strategies within multi asset and in equities from North American and Australian small cap and Japanese equities.

Gross new business of £39.0 billion was added during the year, sourced from investors in EMEA ex UK 35%, the Americas 13%, the UK 46% and Asia Pacific 6%. Net outflows for the year were £32.8 billion.

Equity performance has improved during the year as a consequence of some of our long-term holdings recovering. Whilst we set our objectives around longer term performance, it is pleasing that Global Equities has performed well in 2016, which is gradually feeding into the longer term performance numbers. Our consistent priority is to adhere to our investment process and we believe that our longer term investment approach of investing in higher quality companies, together with a strong focus on engagement with the companies we own is fundamental. Although some strategies remain slightly behind benchmark over some shorter time periods, longer term track records remain healthy. Assets under management increased to £89.1 billion (2015: £80.1 billion).

Fixed income performance continues to be solid, albeit the continuing low yield environment is a difficult one in which to excel with more traditional products. The fixed income teams now manage AuM of £70.0 billion and we provide clients with dedicated fixed income portfolios and a range of pooled funds, as well as incorporating these investments into bespoke/tailored multi asset solutions. Our strongest areas of performance are credit and emerging market debt, but the latter suffered outflows as a result of sentiment.

Negative net flows of £0.8 billion from property were the result of a reduction in appetite for UK assets, especially after the Brexit vote and the successful realisation for our clients of some of the fixed-life Nordic funds. Following the UK referendum, the Aberdeen UK Property Fund was one of only a few open end funds that did not close for an extended period. Our focus was to treat all customers fairly by providing liquidity to those who requested to redeem, whilst protecting the interests of long-term investors and we suspended dealing for a few days, solely to enable investors to consider and understand our proposals. More generally, we successfully increased our capabilities in the residential sector across UK and Europe, generating a strong pipeline of committed investments of over £1 billion and continue to see strong demand for European assets.

We made our multi asset capability a separate asset class, reflecting the £89.9 billion managed for insurance, pension and wealth clients. We are developing our fund offerings where we have a good performance track record in our diversified growth strategy which has helped to receive a number of buy recommendations from consultants during the year. This has not yet turned into significant inflows, albeit we have won a significant pensions mandate funding after the year-end, and we are optimistic about future growth. Whilst the structural outflow from SWIP amounted to £8 billion, flows into this fund will be at considerably higher fee rates than the average.

Much of the £22.8 billion managed by the quantitative investments team is for the benefit of larger multi asset mandates, where the team is able to offer lower volatility and lower cost investment options. The recently launched low volatility equity and equity income strategies aim to outperform global equities indices over the longer term, whilst only capturing 75% to 85% of the volatility.

The acquisitions that we have made in alternatives serve to round our offerings by both investment capability and geographic coverage. The integrations have gone very well and we are pleased to report good stability across the investment teams, and importantly retention of the focus and expertise that we have acquired in areas such as venture capital, real assets, lower mid-market private equity, liquid alternatives and managed account solutions.

A strategic priority for the Group has been to broaden out our solutions role within the wider business such that it now works across all of our investment departments to provide bespoke solutions and portfolios to clients and strategic partners. This central solutions team has leading skills in research and the design and build of client solutions across multiple asset classes for large and complex clients.

We are focused on our distribution capabilities where our strengths match market demand and develop new channels in order to attract new clients. We recognise that not only do we need to have best in class products but that we need to build strong relationships across multiple channels. This approach has led us to build out specialist distribution teams covering investment and client solutions across insurance, closed-end and wealth channels as well as consultant driven opportunities together with more proactive client engagement.

Brexit

Until the negotiation begins formally, expected by the end of March 2017, the terms of the withdrawal and any impact will be largely unknown. We do not expect either our non-UK or UK businesses to be affected in a substantive way by the result of the referendum, although there may be regulatory and/or legal changes in the longer term.

Our principal cross-border fund range for European investors outside the UK has been domiciled in Luxembourg for many years. Beyond the fund range, the core issue is how we will be able to provide our investment management skills from the UK into the EU market - whether through the benefit of passporting, acceptance that the UK forms
an 'equivalent' regime or through co-operation agreements with member states.

The Board

I would like to thank my colleagues on the Board who have, once again, made valuable contributions to its effective operation during the year. We have added further strength during the year with the appointment of Gerhard Fusenig as an independent non- executive director.

As had been reported previously, Roger Cornick retired following close of business on 30 September 2016, having served on the Board for 12 years, the last seven years of which as Chairman. On behalf of myself and my fellow directors, I would like to thank and pay tribute to Roger for his leadership of the Board throughout his tenure and the invaluable advice and support he always provided. I would also like to thank Anne Richards and Jim Pettigrew, who both stepped down from the Board this year, for their contribution to Aberdeen over many years.

On behalf of the Board I would like to welcome all new colleagues who have joined Aberdeen over the past year and to thank all of our staff for their dedication and commitment to the Group's continuing success.

Outlook

Our primary objective remains unchanged - to ensure that our clients achieve the long term outcomes that they
expect - and we remain fully focused on this goal. We enter the new financial year with a healthy balance sheet and as a full-service asset manager with a strong distribution focus, and a broad range of capabilities which can adapt to changing investor appetites to enable us to remain competitive in a rapidly adapting market.

The asset management sector is facing three head winds: fee pressure, increased investment in technology and regulatory capital requirements. We will continue to seek further cost efficiencies, whilst also being prepared to make appropriate investment in innovation and otherwise supporting the future growth of the business and motivating our diverse workforce.

We welcome the FCA's interim report on its review of the competitiveness of the UK investment sector as it focuses attention on some key industry issues impacting customers. Asset managers play a vital role in helping investors achieve their financial goals and the FCA's proposals will help deliver this for the UK industry, making it more attractive on the global stage by leading the way in best practice. There is a need for increased transparency in relation to the services provided, the costs of such services and also for ensuring value for money.

Future political and economic events, including the UK's negotiations to exit the EU, the start of President-elect Trump's term in office and European elections, will contribute to ongoing volatility in global markets in the short term. However, until there is greater clarity, it is difficult to predict the impact on markets over the medium and longer term. We will not allow any such volatility to distract us from our long term approach to investing, and we remain well positioned to identify and grasp the opportunities that may arise to deliver further profitable growth.

Simon Troughton

Chairman

¹Restated to reflect gross position for cash pooling arrangements (see note 1).

Notes to the Financial Statements

ASSETS UNDER MANAGEMENT AT 30 SEPTEMBER 2016

OVERALL NEW BUSINESS FLOWS FOR 12 MONTHS TO 30 SEPTEMBER 2016 - EQUITIES

OVERALL NEW BUSINESS FLOWS FOR 12 MONTHS TO 30 SEPTEMBER 2016 - FIXED INCOME