Abrdn profits fall after ‘one of the toughest investing years’

Profits at Abrdn dropped by almost a fifth last year as the end of the more than decade-long bull market deepened the challenges facing the UK asset manager.

Led by former Citigroup executive Stephen Bird, Abrdn suffered net outflows of £10.3bn last year, largely from its equities businesses. Assets under management fell by 8 per cent to £500bn.

Bird said 2022 was “one of the toughest investing years in living memory”, noting that the “business is continuing to simplify and reduce costs”.

As a result, operating profit at the company fell to £263mn last year, down 19 per cent from 2021. The fall was driven by a decline in investment revenues, although the squeeze on profits was smaller than analysts expected.

Abrdn last year acquired Interactive Investor for £1.5bn, which Bird said had boosted its presence in the UK savings and wealth market. Interactive Investor reported net revenue of £176mn, up nearly 40 per cent, and doubled operating profit to £94mn.

Bird restructured the business, merging or closing 58 funds and appointing Peter Branner as chief investment officer.

The company also said that it was looking to sell its discretionary fund management arm and that it was considering further small acquisitions.