Ninety One has seen its assets under management surge to a record £143.9bn for its 2022 financial year after seeing an uptick in adviser demand for its global and thematic funds.
Total assets were up 10% from £130.9bn a year ago, as the fund group returned to net inflows.
Clients poured £5bn into its funds over the 12 months to 31 March 2022, a big improvement from the £200m in redemptions it suffered in its maiden set of results after decoupling from Investec.
Off the back of this, profit before tax leapt 31% to £267.1m, while adjusted operating profit rose 12% to £230.4m.
UK advisers pile into global and thematic funds
Despite the end of the reporting period overlapping with the ensuing crisis in Ukraine, Ninety One reported net inflows across all asset types and client groups.
Its fixed income funds took in the most money during the period at £2.4bn, which was driven by its emerging market, Asian, African and total return credit strategies.
However, its equity funds enjoyed the biggest bounce back, year-on-year, attracting £1.6bn after haemorrhaging £3.2bn in 2021.
Demand from UK advisers for its global and thematic strategies helped boost assets in its equity division to £68bn.
Alongside the North American institutional market, the UK intermediaries space is one where Ninety One sees “growth opportunities” and, as a result, it has been upping its investment in the region.
While institutional clients still account for the lion’s share of AUM at £95.7bn, its adviser channel has been growing at a faster rate. Last year assets hit £48.2bn, up 14% from £42.3bn the year before, and net flows for the year matched the institutional group’s £2.5bn thanks to strong demand from advisers in the UK and its home market of South Africa.
Russian invasion of Ukraine leads to deteriorating performance
Despite the upbeat set of results, CEO Hendrik du Toit (pictured) struck a cautious tone about the year ahead.
“Business and market conditions deteriorated towards the end of the reporting period and are expected to remain challenging into the next financial year. The spectre of inflation and rising interest rates in a world of supply chain disruption and increased political uncertainty speaks to volatile markets and a diminished risk appetite among end investors,” he said.
Volatile trading conditions have already started to take a toll on fund performance. Though Ninety One said its firm-wide performance “remained competitive” for most of the year, it admitted the market correction during the Russian invasion of Ukraine caused a number of its larger strategies to drop below their benchmarks. As such, firm-wide outperformance “deteriorated” to 50% over one year and 68% on a three-year view.
Du Toit said there were “nevertheless substantial long-term growth opportunities for Ninety One in the markets we serve”.