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Henderson expects profits to be slashed in half

Henderson Group has warned that it expects profits to halve for the first half of 2009.

The group says it expects profits of between £25m and £28m in the period, including one quarter’s contribution from New Star, with the figure down from the £50.8m taken in for the first half of 2008.

Henderson says the contribution of New Star will increase Group earnings in the second half of the year with a full period of ownership. The firm says asset retention levels are 77 per cent better than expected.

Henderson says it has reduced the expense ratio of the acquired New Star business to 38 per cent from July 1, 2009, six months ahead of expectations.

Henderson Group chief executive Andrew Formica says: “Although we saw some welcome stability return to markets in the second quarter of 2009, they remain significantly below the average level of last year.”

“As expected, and as flagged earlier this year, lower markets, combined with fragile investor confidence and demand, have had an adverse impact on our revenues. The prompt action we took to reduce our costs and the benefits of the New Star acquisition for nearly three months have helped to offset some of this impact, but profits will be lower in the first half of 2009.”

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