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Gartmore integration hits Henderson profits

Henderson Asset Management made a small pre-tax loss of £3m for the first half of 2011, due to costs related to the Gartmore acquisition.

This compared to pre-tax profits of £41.6m for the first half of 2010 and took into account the £51.7m spent on Gartmore integration costs. The group recorded a 78 per cent increase in underlying profits for the first half of 2011 at £86.4m, compared to £48.5m for the first half of 2010.

Assets under management grew from £61.6 billion at the end of 2010 to £74.4 billion over the same period.

Henderson completed the acquisition of Gartmore in April for £365.4m.

Higher management, performance and transaction fees lead to total fee income rising to £254.5m. Management fees accounted for 51 per cent of this increase.

Performance fees derived from Henderson amounted to £41.1m while those from Gartmore came to £13.2m.

Inflows of £600m into Henderson’s retail funds were offset by £300m in outflows from Gartmore retail funds. The group remains positive about Gartmore’s performance, saying it “exceeds expectations.”

Andrew Formica, chief executive of Henderson, remains wary about the future outlook. He says:  “Looking at the recent turmoil in markets we are managing the business on the assumption that conditions remain challenging in the short- to medium-term.”

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