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Henderson pre-tax profit falls 8.6%

Henderson has reported an 8.6 per cent fall in pre-tax profits as volatile markets led to a fall in demand for its products.

The group’s accounts, published today, show pre-tax profits fell to £79m in the six months to 30 June, down on the £86.4m per cent recorded for the same period in 2011.

Assets under management dropped to £63.6bn at the end of June, a fall of 14.5 per cent from £74.4bn over the same period in 2011.

The group says it incurred net fund outflows of £2.1bn as clients continued to shift out of risk assets amid concerns over economic growth and the eurozone debt crisis. These were counteracted by market and FX movements during the year, which resulted in an increase of £1.4bn.

Total retail assets in the investment management arm fell by £893m in the first half of 2012, although this again was offset by an increase of £698m due to market and FX movements. Total retail assets stood at £27.2bn at 30 June, down from £27.4bn at 1 January, 2012.

Henderson’s absolute return funds have seen retail outflows of £141m in the first half of 2012.

Henderson says this is due to volatility in markets and a lower demand for European, Japan and Asian strategies. At 30 June, the group’s assets under management for absolute return retail funds stood at £1.12bn.

The group has increased its interim dividend to 2.1p a share for the first half of 2012, up from 1.95p for the first half of 2011.

Henderson chief executive Andrew Formica says: “”In a volatile time for all markets, these financial results are solid. On the positive side, profits and margins have held up and, crucially for the long term, two-thirds of our funds have matched or beaten their benchmarks over three years. Against these encouraging achievements, we have seen net outflows across our business.

“Looking ahead, we continue to invest in our fund manager and distribution talent, review the number and variety of funds and control costs across the business – measures all designed to provide high quality service for our clients and to maintain our financial strength.”

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