In its annual results, OMW said adjusted operating profit for 2017 was £363m ($507m, €409m) for 2017, a figure 40% higher than the prior year of £260m.
The figure includes £152m from Old Mutual Global Investor’s single strategy business, which was sold in December 2017.
Net performance fees for 2017 were reported at £101m, this was substantially ahead of the 2016 figure of $26m and described in the report as “unusually high” due to “exceptional performance from a narrow range of funds in favourable market conditions”.
Revenues also grew by 21% to £1bn due to the higher average of assets under management and administration, which increased to £138.5bn in 2017 from £123.5bn in 2016 .
Net client cash flow (NCCF) for 2017 hit £10.9bn and were up 110% on the prior year’s figure of £5.2bn.
International operations
International net flows more than doubled to £1.4bn, up from £500m in 2016, driven by strong net flows from Latin America, the Middle East, UK and Europe.
Peter Kenny, managing direct of Old Mutual International, said the figures show the business has had a “fantastic year”.
“We have focused on developing our core growth markets, expanding our distribution footprint in these markets, and building our high net worth business.
“Our proposition was refreshed in 2017 with the launch of several new offshore bond solutions, which have been well received, especially in the UK where offshore bonds are attracting a new client base following the tightening of a number of pension allowances,” Kenny said.
OMW to Quilter
In November last year, OMW announced it was be rebranding as Quilter following the managed separation from its parent company Old Mutual Plc.
It’s business will be segmented into “advice and wealth management” and “wealth platforms”.
Following the release of the results, OMW chief executive Paul Feeney said the business is now ready to move forward with its new name.
“We have a strong balance sheet, a strong capital and liquidity position and we are financially independent from Old Mutual plc. We have completed our separation activities and we are ready to list as Quilter plc,” Feeney said.
It is understood the managed separation will be completer by the end of 2018.
Advice and wealth management
For the advice and wealth management business (AWM), pre-tax profit increased from £82m, up 39% from prior year of £59m.
AWM contributed £4.4bn to the total NCCF for the business. The multi-asset NCCF attributed £3.3bn to this total net flow, which was driven in particular by strong performance of the Cirilium and Wealth Select fund ranges.
Platforms
Wealth platforms posted a pre-tax profit of £158m, down 5% from prior year of £166m. OMW attributes the decrease to an adjustment in the 2016 figures, which excluded the business restructuring its institutional life company, Heritage.
NCCF for the firm’s UK platform was up 61% to £4.5bn, from the 2016 figure of £2.8bn.
The business says this growth comes off the back of strong flows into pension propositions as customers continue to consolidate existing pensions.
“Sales into the pension propositions accounted for 61% of total UK platform sales,” the report said.
“Transfers by customers from their defined benefit pensions into defined contribution schemes accounted for gross sales of £1.8 billion in 2017, representing 20% of gross platform sales and 6% of total gross sales.”
