Aberdeen Asset Management : full-year assets hit by emerging market outflows

LONDON (Reuters) - Aberdeen Asset Management (>> Aberdeen Asset Management plc) reported a 12.5 percent fall in its full year assets under management on Monday, after nervous investors pulled money out of its emerging market equity funds, with further outflows likely in 2016.

Emerging markets have been roiled this year amid fresh concerns around global growth, particularly in China, and the likely impact of rising U.S. interest rates, hitting shares in Aberdeen and peers such as Ashmore (>> Ashmore Group plc).

Assets at the end of September were 283.7 billion pounds, down from 324.4 billion pounds a year earlier, Aberdeen said in a statement, after outflows from equity funds rose to 16.4 billion pounds from 13 billion.

"A major factor has been asset allocation changes by clients, largely on the basis of their views on macroeconomic factors," Chief Executive Martin Gilbert said.

"This was a persistent theme during the year, but was more pronounced in the final quarter, with the industry experiencing the worst quarter for outflows from this asset class since the global financial crisis."

Gilbert added the weakness "may have some way to run", but said the company's decision to broaden its product offering and expand into developed markets such as the United States had helped underpin a solid set of results.

In 2015, that strategy has included the purchase of FLAG Capital Management and Arden Asset Management, which will boost assets in Aberdeen's alternatives unit, which invests in assets such as hedge funds, to more than 20 billion pounds.

Underlying pretax profit over the period was up slightly to 491.6 million pounds from 490.3 million pounds, despite the outflows, helping fund an 8.3 percent increase in the firm's dividend to 19.5 pence a share.

"We continue to rebalance and diversify the business, to focus on managing our costs and to generate cash and this has helped to mitigate the impact of the outflows we've seen," Gilbert said.

(Reporting by Simon Jessop, editing by Sinead Cruise)

By Simon Jessop