Abrdn shares plunged the most in 14 months after clients pulled money from its equities funds last quarter, leading to outflows that underscored the challenging task the firm’s new chief executive officer is facing.
Investors pulled a net £3.1 billion ($4 billion) from abrdn’s funds in the three months to Sept. 30, the firm said in a statement on Oct. 24. The outflows were mainly due to redemptions from its equities funds, while fixed-income also saw about £800 million of outflows which were “largely driven by a single mandate redemption.”
The stock slid as much 7.6% in early London trading on Oct. 24, with RBC analysts writing in a note that the update seemed like a “step back in the flow turnaround” following two quarters of improvement.
Assets under management and administration remained largely unchanged compared to the previous quarter at £506.7 billion, helped by positive market movements and inflows into abrdn’s retail broker platform Interactive Investor.
The Edinburgh-based company last month named its former finance chief Jason Windsor as permanent CEO. A former executive at Aviva and Morgan Stanley banker, Windsor took over as interim CEO in May when Stephen Bird stepped down following a few tumultuous years at the firm.
The asset manager has faced years of outflows and consecutive rounds of job cuts. While the industry itself has been grappling with client redemptions and squeezed margins that have led to mergers and cost-cutting measures as firms try to survive, abrdn’s troubles have been more pronounced.
In January, abrdn announced plans for another round of job cuts to rein in costs and said it would eliminate roughly 500 roles, or 10% of its workforce, as part of a program to save at least an annualized £150 million.
