St James’s Place PLC on Thursday said it swung back to profit in the first half of 2023, but both gross and net inflows declined from a year before.

Shares were down 12% to 1,039.32 pence early Thursday in London. The stock is down 9.7% over the past 12 months.

The Cirencester, Gloucestershire-based wealth manager reported an IFRS pretax profit of £385.0 million in the six months that ended June 30, swung from a £295.5 million loss a year before. IFRS stands for international financial reporting standards.

Fee and commission income more than doubled to £1.35 billion from £687.6 million a year before. Investment return was positive £6.65 billion, swung from negative £16.99 billion, but this was almost exactly balanced by movement of investment contract benefits swinging to negative £6.60 billion from positive £16.97 billion.

Fund under management totalled £157.5 billion on June 30, a new record high and up 6.1% from £148.4 billion on December 31.

However, gross inflows during the half-year slowed to £8.0 billion from £9.1 billion a year before, and net inflows slowed to £3.4 billion from £5.5 billion.

St James’s Place noted it had a 95.6% annualised retention rate in the first half.

‘This has been a challenging period for many UK savers and investors who have had to contend with high and persistent inflation, rising borrowing costs, a mini banking crisis in the US and attendant stock market volatility, and continued macro-economic and geo-political uncertainty,’ commented Chief Executive Officer Andrew Croft.

He added: ‘Given the scale of inflationary pressures facing consumers in the UK it is, however, little surprise that we have seen a return to more normal investment withdrawal rates across our pensions and bonds business, together with an increase in surrender rates across smaller unit trusts and ISA portfolios.’

St James’s Place declared an interim dividend of 15.83 pence per share, up 1.5% from 15.59p a year before. It noted the interim dividend was based on 30% of the 2022 full-year payout.

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