The trading update gave a solid set of figures for the full year despite difficult market conditionsin Q4. Profit after tax came in at £6.5m and, as expected, an unchanged full year dividend of 24p is once again covered by earnings.
Emerging equity markets have been weak since the last update in April, but a combination of new business and good performance has kept funds under management at $4.2bn. Over the financial year as a whole FUM have grown 8% in US Dollars against a fall of 5% in the MSCI Emerging Markets Index supported to new business and outperformance.
There is mixed news on new business. The full year inflows of $477m to emerging markets and $255m to new strategies are pretty much in line with targets. Unfortunately emerging market outflows of $437m mean net inflows of only $40m in that area.
A key issue for investors is the return to dividend cover for the full year. Profit after tax was £6.49m, slightly behind our estimates due to weak markets and a slight strengthening of sterling since April. The dividend was kept unchanged for the full year and is covered 1.1 times by earnings.