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Henderson profits surge but it faces £7.6m FSCS levy

Andrew Formica
Formica: ’Reinforce position’

Henderson has received a £7.6m interim levy from the Financial Services Compensation Scheme as it announced a 37 per cent increase in profits for 2010.

Underlying profit was £100.7m compared with £73.7m in 2009 and assets under management rose by 11 per cent to £58.7bn.

The company has seen higher margin inflows of £2bn in 2010 compared with £700m while operating margin increased by 9 per cent to 30 per cent.

Henderson says this is due to higher market levels, positive higher margin inflows as well as the benefits of the New Star acquisition in April 2009 and continued cost control.

The board has proposed a final dividend for the full year of 4.65p, up from 4.25p.

The FSCS last month announced a £93m interim levy on advisers. The levy includes FSCS compensation costs of £86m, mainly to compensate Lifemark investors, and management expenses of £7m. In addition, investment fund managers are to be billed £233m, meaning the total FSCS interim levy is £326m.

Earlier this year, Henderson announced plans to acquire Gartmore for an estimated £335m. The acquisition is set to conclude in April.

Henderson chief executive Andrew Formica says: “This acquisition will reinforce our position as a diversified asset manager bringing with a credible, traditional and absolute return franchise as well as additional investment strengths and it will significantly streng- then our presence among UK retail investors.”

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