Charles Stanley shed £4bn in client assets during the year ending 31 March as Covid-19 took its toll on the final quarter, but profit, revenue and earnings per share all increased.
The wealth manager’s latest annual results showed funds under management and administration (FUMA) fell from £24.1bn to £20.2bn over the period. Discretionary funds dropped from £13.1bn to £12bn while advisory managed funds fell from £1.5bn to £1.2bn.
Its advisory dealing funds fell to £1bn from £1.3bn while execution-only funds dropped to £6bn from £8.2bn the year before.
Covid-19 hits last financial quarter
Charles Stanley said overall FUMA was affected by the impact on global markets of the Covid-19 virus in the last financial quarter, but noted the 16.2% year-on-year drop in assets was better than the FTSE All Share index’s 21.9% loss.
The wealth firm said its mix of assets continues to shift toward the higher-value managed services, with these accounting for 65.3% of assets.
Its reported profit before tax jumped 57.3% to £17.3m while earnings per share rose by 58% to 28.03p and group revenues increased by 11.5% to £173m.
Investment management services reported a profit of £23.4m compared with £15m the year before, while Charles Stanley Direct, the firm’s online execution-only platform, booked £1.6m profit, up from £1m in 2019. Its financial planning arm reported a loss of £5.1m compared with a £3.4m loss in 2019.
It said fee income, which now accounts for 71.2% of group revenues, grew by 11.7% over the year to £123.1m. Commission income rose by 8.4% to £39.8m and interest income increased by 21.7% to £10.1m.
The firm also noted progress in achieving enhanced diversity at senior level with 36.6% of female representation at senior management level, up from 30% last year.
Charles Stanley chief executive Paul Abberley (pictured) said: “Covid-19 is now the major challenge for everyone globally. I am pleased to report that the group responded swiftly to safeguard the well-being of all our staff through remote-working while also maintaining a very high level of service to clients.
“Trading results for the new financial year are expected to be significantly impacted by the crisis, with lower stock market valuations and reduced interest rates. However, Charles Stanley is well positioned to navigate through the challenges and to emerge strongly.”
