There are reasons to be bearish just now.

Ashmore– H1 Results

Share Price 553p

Mkt Cap £3.94bn

Conflict Disclosure: No Holding

  • Results Revenue was up 20% to £177.3m from AUM up 28% year on year to $98.4bn.. EBITDA up 24% to £122.5m and a contribution from seed capital items of £8.4m meant that PBT was up 48% to £132.8m. Cash was £427m from net assets of £810m. 12 month performance has tailed off with only 24$ outperforming benchmarks. Outlook is well positioned to grow in keeping with the trend of higher investor allocations.
  • Estimates Full year to June estimates anticipate £251m PBT. The company has delivered 52% of this in H1 when AUM grew 7%. Stripping out seed capital returns 49% of the full year estimate was delivered in H1, suggesting estimates may be perhaps 5% too low.
  • Valuation PE 19.5X Yield 3.3%
  • Culture The CEO owns 37% of the equity so it is no surprise to see no LTIP in existence, merely a bonus deferral scheme. However the CEO total comp last year of £3.6m may merit a 32 page remuneration report.
  • Conclusion With 87% of AUM being from institutions there may be reason to have concern over the sustainability of the fees although this is a highly specialist asset class. Hard to fault and cheaper that Gresham House, Impax, and Liontrust. The flows show it is one of the winning specialists

jeremy@charltonillingworth.co.uk