February 2, 2017 / 7:15 AM / 4 years ago

Aberdeen hit by first quarter quarterly outflows, says more to come

LONDON (Reuters) - Aberdeen Asset Management said total assets fell 3 percent to 302.7 billion pounds in the first quarter, as fresh outflows after the U.S. election overshadowed market gains.

The firm has been hit by persistent outflows from its funds on concerns about growth in emerging markets, and a fledgling recovery in sentiment in the early part of the quarter was snuffed out by the impact of the U.S. election, it said.

“People are waiting to see what [U.S. President Donald] Trump does... but if the economy in the U.S. improves, the rest of the world will do well,” Chief Executive Martin Gilbert said on a conference call with journalists.

Net outflows across all its products totalled 10.5 billion pounds, it said in a statement, versus market gains of 3.3 billion pounds.

Aberdeen said the bulk of the outflows were from lower margin products, and had been largely anticipated. It added that a further 2.4 billion pounds was scheduled to be withdrawn from lower-margin portfolios this quarter.

“Each of the company’s main divisions experienced outflows during the quarter, making it difficult to see where there could potentially be organic growth in the near term,” KBW analyst Jonathan Richards said in a note to clients.

“Q1’s outflows were greater than what was seen in any quarter in 2016,” he said.

It marked the 15th consecutive quarter of outflows, for a cumulative figure of 104.6 billion pounds, Shore Capital analyst Paul McGinnis said in a note to clients.

Aberdeen shares were down 4.5 percent at 0816 GMT, among the top fallers in a flat FTSE midcap index.

The firm’s fixed income products saw the steepest drop in assets - 4.2 billion pounds - although part of this was the result of a decision to withdraw from managing several mandates, it said.

Despite the outflows, Aberdeen saw positive market gains across its equities, multi-asset, alternatives, quantitative and property products.

“We continue to make encouraging progress across all asset classes, with a healthy level of client interest and demand,” Gilbert said in a statement.

“While growing interest in a number of our strategies is likely to continue to be masked, in the short term, by significant withdrawals by a small number of clients, I am encouraged by the progress being made.”

Reporting by Simon Jessop; editing by Rachel Armstrong and Jason Neely

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