As part of Old Mutual Wealth’s H1 2015 results published on Thursday, its cross-border business revealed that net client cash flow – the difference between money received from customers and money given back to customers – had reached £300m, up £200m on the first half of 2014.
Paul Feeney, chief executive of Old Mutual Wealth, said the company’s new licence in Miami has helped increase its presence in Latin America, while its new product in Hong Kong – launched in response to the banning of indemnity commission in January – has been well received by advisers in the region.
“We continue to focus on improving our product and service offering to financial advisers via our international business and it is pleasing to see this work reflected in our financial performance,” he said.
Overall, OMI’s funds under management increased by 2% to £15.9bn while adjusted operating profit grew 13% on 2014 to reach £26m.
As a Group, Old Mutual Wealth saw net sales grow by 92% in the first half of 2015 to reach £2.3bn, while its adjusted operating profit pre-tax was £151m, up 26% compared to the prior year, and its funds under management stood at £11bn as of 30 June.
Feeney said the group’s results have been driven by the pension freedoms introduced in April: “We are seeing huge demand for our flexible income drawdown product. Retirement income has been redefined beyond recognition and income drawdown has come of age following the pension freedoms.
“Annuities, for so long the default option for turning savings into an income, have fallen from grace with just 16% of those not yet retired looking to use an annuity. In contrast, around 65% of current retirees are receiving their income through an annuity.”
Pension sales via the group’s wealth platform rose by 43% compared to H1 2014, while pension transfers in progress were up 133% in June compared to January 2015.
Additionally, the group’s acquisition of wealth manager Quilter Cheviot in February 2015 generated £0.4bn NCCF for the full half year and contributed NCCF of £0.3bn to Old Mutual Wealth from the completion of the acquisition.
Old Mutual Global Investors, the group’s asset management arm, saw FuM reach £22.4bn as of 30 June 2015, up 7% on the start of the year, when it stood at £21bn. It adjusted operating profit for H1 2015 was 88% higher on H1 2014 at £30m.
Meanwhile, half of its core funds remain in the first quartile over a three-year period, and a total of 81% of funds sit above the median.