Neptune profits drop 40% for second year running

Neptune Investment Management saw its assets under management, revenue and profits slide by as much as 42 per cent in 2013.

The firm’s accounts for 2013 on Companies House released at the end of April this year reveal that profit before tax at Neptune dropped to 42 per cent to hit £7.4m at the end of last year, down from £12.8m in 2012.

Assets under management also took a hit in 2013 falling to £5.4bn from £5.8m for the same period a year previous while revenue at the firm slid 14 per cent from £85m at the end of 2012 to reach £72.9m in 2013.

The figures mark the second year running of falling revenues and profits for Neptune. Pre-tax profit at the end of 2012 had also dropped 39 per cent from the year previous while revenues dropped 16 per cent and AUM shrunk from £6.3bn to £5.8bn.

Neptune chairman Jonathan Punter believes the backdrop of loose monetary policy coupled with the shift towards developed market equities created a “short-term negative impact” in what is otherwise a “robustly healthy and profitable business”.

“The last two years have seen significant headwinds. First the abnormally loose monetary policy of central banks, in the response to the financial crisis, has seen flows of risk capital into bonds and largely out of equities. Secondly this trend is running parallel with flows out of emerging markets and into developed markets,” he said.

“Neptune is much more internationally positioned than most of its UK-centric competitors and this strategic strength has had a short-term negative impact, exacerbated by the current overvaluation of sterling.”