Coronation hampered by volatile markets


Coronation hampered by volatile markets

Published Date: 2019-05-22 | Source: Stephen Gunnion | Author: Stephen Gunnion

Coronation hampered by volatile markets

The fund manager has reported lower earnings and trimmed its interim dividend after weak markets and the subdued economy affected asset levels.

Coronation Fund Managers says it's more positive on prospects for the second half of its financial year after posting a sharp fall in first-half earnings.

Releasing interim results, the fund manager said volatile markets towards the end of last year were only partly offset by a recovery in the first quarter of this year, with the JSE's All Share index rising just 2.7% in the six months to end-March.

At the end of its reporting period, total assets under management were virtually unchanged from September's levels at R586 billion, but were 8% lower than a year earlier. That contributed to a 22% decline in revenue for the period. Although operating expenses declined by 10%, due to an 18% fall in variable costs, Coronation still reported a 26% drop in headline earnings per share to 165.1c for the period. It's paying an interim dividend of 165c per share, down 26% from last year.

Assets under management for institutional clients were also steady between September and March at R346 billion, while retail assets fell marginally to R240 billion from R241 billion. It said net inflows at an industry level were subdued as the weak economy impacted savings levels. Funds managed for global clients rose 11.5% to R68 billion in rand terms.

Coronation said if current market levels held, it expected an improvement in the second half of the year.

Its shares fell 2.7% yesterday to R50.21.

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