City of London sees funds under management up
FUND manager City of London Investment Group expects a 27 per cent rise in full-year pre-tax profit, helped by its natural resources and developed markets closed-end funds.
The company’s funds under management climbed 18 per cent to £3.54bn from £3.01bn last year.
City of London, which provides emerging market asset management products to institutional investors, has been diversifying into natural resources and developed market closed-end funds.
“Its core emerging markets fund of funds business has now reached capacity constraints and it is largely dependent upon the vagaries of markets to drive growth,” analysts at Peel Hunt said.
“Only the natural resources fund has established a three-year performance track record and this limits its ability to attract institutional inflows into these news funds.”
For the June-May period, City of London expects pre-tax profit to rise to about £13.2m from £10.4m last year.
The fund manager also said it expects to pay a final dividend of 16p, up nearly seven per cent from last year, taking the total dividend to 24p.