LONDON (ShareCast) - F&C Asset Management swung into profit for the year and said it remains committed to its three-year plan but warned of the challenging market conditions

Pre-tax profit for the year came in at £25.9m compared with the loss of £30.5m last year on net revenues that increased 7% to £264.5m. The swing to reported profit reflects the absence of prior year distortions such as impairment charges.

Assets under management at the year-end fell to £103.6bn from £104.1bn last year

The group said it remains committed to its three-year plan and said the overall progress is encouraging after the first year.
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“As set out further in the Chief Executive's Report, the market and corporate situation creates uncertainty over the timetable for delivery but not to our commitment to the strategic direction,” it said.

The group said there are challenges ahead from the deteriorating economic environment and volatile markets but feels it is well placed to deal with the situation.

“We have no direct exposure to US sub-prime mortgages and limited exposure to structured credit instruments. However, volatile markets undoubtedly present significant challenges for active investors and hamper net sales,” it said.

The group added that it has been affected by the uncertainty surrounding Friends Provident and its announcement of divesting its shareholding in F&C.

“The combination of these factors is impacting some client and consultant decisions on new business and has resulted in there being an increased level of uncertainty around the timing of the growth anticipated in the plan,” said the group.

Total dividends for the year have been reduced to 6p from 11p previously.

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