AUM was up 22% year-on-year, rising from £5bn to £6.1bn, with average AUM standing at £5.5bn for the year, some £1bn higher than 2016’s average. By 28 November 2017, AUM had ratcheted up an additional £200m to £6.3bn.
However after factoring in redemptions of £1.4bn, net sales for the year ended 30 September 2017 were weaker than in recent years. Whereas the group took in net sales of £965m and £778m in 2015 and 2016, it only generated £747m in 2017.
Despite this the group ended the year firmly in the black, reporting profit before tax of £11.5m, a 360% uptick. Underlying profit before tax also rose 39% from £10.9m to £14.7m.
In its final results, the group also confirmed it would be absorbing the cost of external research for some of its funds under Mifid II.
From 3 January 2018, the research costs of its multi-asset, fixed income and absolute return funds, which represent 74% of Premier’s AUM, will be covered by the group. Investors in Premier’s equity funds will continue to be charged for the cost of external research on the basis that this “remains a significant part of the active management process for these funds,” the firm explained.
Premier said it does not expect the additional research costs to have a “material impact” on the group’s cost base.
Looking to 2018 and beyond, chief executive officer Mike O’Shea (pictured) said the firm was bracing itself for “quite possibly volatile” markets.
“Although we expect investment and political conditions to remain uncertain, and quite possibly volatile, over the coming year, we continue to see good opportunities for investment firms such as Premier and for our investors,” he said.
“We believe that the ongoing low interest rate environment will continue to make well diversified, income paying investment strategies attractive and we feel strongly that good active management will continue to offer investors the opportunity to achieve their long-term investment goals.”
The firm will stick with its quarterly dividend policy, paying out a final dividend of 8p, made up of three interim dividends of 1.25p per share.
