TOP NEWS: St James's Place At Funds Record, To Pay Withheld Dividend

(Alliance News) - St James's Place PLC on Thursday reported record closing funds under management ...

Alliance News 25 February, 2021 | 9:54AM
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(Alliance News) - St James's Place PLC on Thursday reported record closing funds under management and set an ambitious target to hit GBP200 billion in funds by 2025.

The blue-chip wealth manager also proposed a final dividend for 2020 of 38.49 pence, which is behind market consensus of a 42.0p payout. The final dividend is the total payout for 2020, as no interim was declared.

St James's Place had intended to pay 49.71p to shareholders for 2019, but then withheld 11.22p of the final dividend as Covid-19 took hold. On Thursday, the company said it now plans to pay that skipped 11.22p as an interim dividend in the first quarter of 2021.

"I am pleased to report that we have not needed to utilise those funds and, whilst the pandemic is still on-going, we now have the confidence to pay this withheld amount as a further interim dividend during the first quarter," Chief Executive Andrew Croft said.

St James's Place closed 2020 with GBP129.34 billion funds under management, up from GBP116.99 billion at the start of the year.

The growth was driven by GBP8.25 billion in net inflows and a positive investment return of GBP4.10 billion.

By asset class, St James's Place North American Equities fund - which makes up 24% of total funds - increased 25% to GBP31.3 billion from GBP25.1 billion at the end of 2019.

The wealth manager's Fixed Income Securities fund - which makes up 18% of total funds - increased by 8.6% over the course of 2020 to GBP22.7 billion from GBP20.9 billion. Asia Pacific Securities - 15% of total funds - gained 46% during 2020 to GBP19.9 billion from GBP13.6 billion. UK Equities - 14% of total funds - fell 7.4% to GBP18.7 billion from GBP20.2 billion.

Croft continued: "Our operations and performance during 2020 were inevitably disrupted by the lockdowns and social distancing. However I am very pleased to report that our business has demonstrated real resilience and made further progress with net inflows of GBP8.2 billion for the year and funds under management closing at a record GBP129.3 billion.

"This outcome was possible because of high client engagement levels, our recent major investment in technology platforms, and the agility of our advisers and employees. Overall, I am very pleased with both our new business and financial results for 2020."

The wealth manager recorded a European embedded value operating profit - the company's preferred metric - of GBP919.0 million, down from 3.5% year-on-year from GBP952.0 billion and slightly behind market consensus of GBP924.5 million.

EEV new business contribution totalled GBP766.3 million in 2020 versus GBP793.0 million in 2019, a 3.4% drop.

The wealth manager's pretax profit plunged year on year to GBP426.4 million from GBP708.9 million.

Underlying cash result in 2020 dipped to GBP264.7 million from GBP273.1 million, but was ahead of market consensus of GBP260.2 million.

Croft said: "Given the attractive market outlook for our face to face advisory business model, the scale of the business today, and the progress we have made in developing our technology infrastructure, we look to the future with confidence and in our results announcement have set out some of our key new planning assumptions for the next five years."

St James's Place is targeting FuM over GBP200 billion by the end of 2025.

"Growth on this scale will require continued investment but given the success of our technology initiatives in recent years, we believe overall expense growth can be held to around 5% per annum thereby delivering additional value for shareholders through operational leverage in the cash result. In turn, we are intending to pay-out around 70% of the underlying cash result in dividends annually over the period," Croft added.

Shares in St James's Place were 0.4% higher in London on Thursday morning at 1,227.00 pence each.

By Paul McGowan; paulmcgowan@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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Securities Mentioned in Article

Security Name Price Change (%) Morningstar
Rating
St James's Place PLC 1,358.50 GBX 0.41 -

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