Old Mutual Wealth profits fall 31%

Old Mutual Wealth

Old Mutual Wealth’s profits have fallen 31 per cent in the first half this year to £104m compared to £151m in H1 2015.

Despite the disappointing adjusted operating profits, Old Mutual Wealth saw inflows up 39 per cent to 3.2bn.

Funds under management reached £112.2bn up 7 per cent from the year end.

The half yearly results reported that it had experienced positive inflows since the EU referendum result, but did not expect that to continue in the year’s second half.

Group chief executive Bruce Hemphill says: “The first six months of the year were characterised by volatile currencies and lower average equity markets but our underlying performance demonstrated the strength of our franchises and the positive momentum within each of our businesses.”

Hemphill says the company is “making good progress” with its managed separation, which it expects to be complete by the end of 2018.

The report says the group will be removing 60 jobs from its London head office as part of the managed separation, ultimately resulting in a 50 per cent drop in headcount and saving £10m. It said there was likely to be further job losses in the separation of businesses.

Old Mutual confirmed its current plans for its managed separation would result in two entities – the wealth division, listed in London, and an emerging markets business listed in Johannesburg.

However, the report emphasised these were Old Mutual’s current plans and that a lack of shareholder consent, the possibility of approaches from other companies and the readiness of the underlying businesses.