News Column

Jupiter Fund Management Eyes Increased Dividends As Assets Rise

July 30, 2014

Samuel Agini

LONDON (Alliance News) - Jupiter Fund Management PLC Wednesday reported a 4.4% increase in assets under management in the first half of 2014, boosted by GBP1.3 billion of net inflows largely driven by GBP875.0 million of mutual fund inflows.

In a statement, the FTSE 250 fund manager said assets under management increased to GBP33.1 billion from GBP31.7 billion during the six months ended June 30.

However, first-half pretax profit decreased to GBP48.4 million from GBP59.1 million in the corresponding period last year, as a result of GBP5.3 million of costs incurred on the sale of its private client and charity operations to Rathbone Investment Management. The operations were sold with the aim of simplifying Jupiter's operating model, reducing risk and increasing focus on the mutual fund franchise.

Also eating into pretax profit was a GBP2.6 million write down to nil of iO Adria Ltd, compared with the GBP6.7 million gain in the year-earlier period, made from the sale of its holding in Cofunds Holdings Ltd to co-investor Legal & General Group PLC.

"We believe our chosen savings markets offer the prospect of significant long-term growth. As we extend our relationships with key distributors on a global basis, we are confident we can continue to deliver profitable growth at attractive margins and, within our sustainable balance sheet structure, share the rewards of this growth with our investors," Chief Executive Maarten Slendebroek said in a statement.

Jupiter increased its interim dividend to 3.7 pence from 3.5p.

Slendebroek said that the completion of Jupiter's deleveraging process in early 2014 means Jupiter has a sustainable balance sheet from both a cash and capital perspective, creating the potential for increased returns to shareholders.

"While no final decision has been taken, it is the board's current intention to deliver these returns through progressive ordinary dividends, targeting a 50% payout ratio across the cycle, topped up by special dividends dependent on the size of residual earnings," Slendebroek said.

"In 2014, such returns will be considered after funding the remaining debt pay down earlier this year, retaining sufficient capital to invest for future growth and will include any one-off income, such as net proceeds from the private client transaction. The increase in our interim dividend to 3.7p has been taken in line with this policy," the CEO added.

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Source: Alliance News

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