Tatton Asset Management has seen its assets under management bounce back since being hit by the Covid sell-off, rising 17.4% over the last six months, but net inflows have slowed on the previous year.
The on-platform DFM and IFA support business reported AUM grew by £1.2bn in the six months to 30 September from £6.7bn to £7.8bn, putting total assets back on track after taking a hit from the coronavirus.
Total assets at the firm had peaked at £7.6bn on 21 February but by 31 March the Covid sell-off had wiped £900m from AUM.
Net inflows remain sluggish
CEO and founder Paul Hogarth (pictured) said Tatton’s recovery was driven by a combination of positive organic net inflows and strong investment performance.
But inflows into the business this year have been more sluggish amid the ongoing Covid crisis.
Net inflows were £328.1m for the six months to the end of September, an increase of 4.9% of AUM. In its annual results for the period ended 31 March, Tatton’s average monthly net inflows were £94.1m with total net inflows during the financial year of £1.1bn.
IFA support business ‘largely unaffected’ by Covid
Hogarth said the last six months have been “testing times for many businesses” but said Tatton’s business model has remained resilient.
“We adapted seamlessly to the new trading environment and have maintained face-to-face engagement with our IFAs, where possible,” he said.
“We have also redeployed resources to direct online engagement, running multiple interactive virtual events and frequent video investment updates, which have been well received and have proved to be very successful.”
Group revenue increased to £11.0m, a 12.6% increase on a year ago, while adjusted operating profit rose 21.9% to £5.0m.
Hogarth said Tatton’s IFA support business Paradigm Consulting had been “largely unaffected by the pandemic” and had increased its members by 2.5%.
Its mortgage distribution and support arm, Paradigm Mortgage Services faced a challenging environment in Q1, he said, but has been “performing well” in the current market.
Shares in the firm were up 4% at 295p on the back of the trading update.
