Ashmore, a fund manager with a focus on emerging markets, disclosed a 6% decrease in annual profits on Wednesday, alongside a noteworthy reduction in assets under management, as investors adopted a risk-averse stance amid turbulent global financial markets.
During the fiscal year that concluded on June 30, Ashmore registered net outflows amounting to $11.5 billion, consequently reducing its assets under management to $55.9 billion.
The fund manager posted a pre-tax profit of £112 million ($140.88 million), which was partly bolstered by increased interest earned on cash holdings following a series of central bank interest rate hikes.
The past few years have been marked by volatility in emerging markets, with both stocks and bonds experiencing substantial losses as a result of the COVID-19 pandemic and Russia’s incursion into Ukraine, which had a ripple effect on the global economy.
Tom Shippey, Ashmore’s group finance director, expressed optimism about the future, stating, “We’ve witnessed a cycle in emerging markets…but we are now observing promising signs of recovery.”
Reflecting the decline in performance, the firm reduced variable compensation for its employees by 24%, with adjusted net revenue seeing a corresponding decline.
Ashmore announced that it intends to maintain its final ordinary dividend at 12.1 pence per share, bringing the total dividends per share to 16.9 pence.
In response to the financial results, Ashmore shares experienced an initial decline of over 2% in early trading, bringing their total losses to more than 20% since the beginning of the year, marking the fourth consecutive year of double-digit declines.
(Note: Currency conversion used: $1 = 0.7950 pounds)
