17 April 2024

BROOKS MACDONALD GROUP PLC

Third Quarter FUM Announcement

"FUM up 2.0% in the quarter to £17.9 billion"

Brooks Macdonald Group plc ("Brooks Macdonald" or "the Group") today publishes an update on its Funds under Management ("FUM") for the third quarter of its financial year, the three months ended 31 March 2024.

Andrew Shepherd, CEO of Brooks Macdonald commented:

"Today we report that FUM increased to £17.9 billion over the course of the quarter as markets responded to the improving macroeconomic outlook. We have also seen encouraging flows in our Platform MPS and specialist BPS propositions demonstrating continued demand for our broad product range.

"However, interest rates are still high, placing continuing pressure on our clients, and we remain focused on meeting their needs through our innovative solutions and excellent client service.

"I remain confident in our future opportunity, and I want to extend my appreciation to all our stakeholders for their ongoing support, and to everyone at BM in particular for their unwavering commitment to our clients."

Quarterly FUM update

During the quarter ended 31 March 2024, the Group's closing FUM increased by 2.0% to £17.9 billion (31 December 2023: £17.6 billion).

Gross inflows were robust at £0.5 billion, whilst gross outflows continued to be elevated given the prevailing macroeconomic backdrop of high interest rates and inflation, reaching £0.8 billion in Q3.  This resulted in overall net outflows for the quarter of £0.3 billion or 1.7%. Positive investment performance in the quarter of £0.6 billion or 3.7%, more than offset net outflows and contributed to the increased FUM.

Highlights for the quarter included:

·    Platform MPS, including the Group's B2B offering for financial advisers, BM Investment Solutions ("BMIS"), grew to £4.2 billion with net new business of 1.7% of opening FUM.

·    BPS experienced net outflows in the quarter of £0.2 billion or 2.3%, as clients continue to withdraw funds to repay debt or hold higher cash balances in the current interest rate environment;

·    Within UK BPS, our Decumulation specialised product grew by 9.0% in the quarter, offering a solution to meet clients' income requirements by shielding their portfolio from downturn in the early years of withdrawal;

·    Investment performance for the quarter was positive at 3.7%, slightly below the benchmark¹ which increased by 4.4% in the period, the difference driven by the predominance of clients of a lower risk profile in our book than the benchmark and therefore a higher allocation to bonds which underperformed equities in the quarter;

Outlook

The outlook for underlying profit for the year remains in line with market expectations. In the second half, we will continue to realise the cost benefits of the organisational changes announced in October 2023 while retaining a focus on operational excellence.

Demand for our products and services remains positive, particularly in our specialised BPS products and Platform MPS, which is reflected in our gross inflows. However, given the persistence of current trends in the market and client behaviour, in line with previous guidance, the Group expects net outflows for the full year. 

The strategic review of the Group's International operations is progressing and we will communicate the outcome later this year.

¹ MSCI PIMFA Private Investor Balanced Index

Analysis of FUM net flows by service over the quarter

¹Capital-only index.

Analysis of FUM net flows by service over the nine months

¹Capital-only index.

Analysis of FUM gross flows by service over the nine months

Enquiries to:

Notes to editors

Brooks Macdonald Group plc, through its various subsidiaries, provides leading wealth management services in the UK and internationally. The Group, which was founded in 1991 and began trading on AIM in 2005, had discretionary Funds under Management of £17.9 billion as at 31 March 2024.

Brooks Macdonald offers outsourced discretionary investment management for intermediaries and advice-led integrated wealth management for private clients. The Group also acts as fund manager to a range of onshore and international funds.

The Group has fourteen offices across the UK and Crown Dependencies including London, Birmingham, East Anglia, Exeter, Leeds, Manchester, Nuneaton, Southampton, Tunbridge Wells, Scotland, Wales, Jersey, Guernsey and Isle of Man.

LEI: 213800WRDF8LB8MIEX37

www.brooksmacdonald.com / @BrooksMacdonald