LONDON — Man Group Plc, the worlds largest publicly traded hedge-fund manager, said assets increased 7 percent in the first half of the year, in line with analysts estimates, after clients added money to its GLG Partners funds.
Sales of Man Groups investment funds totaled $12.4 billion in the six months through June, offsetting $9.6 billion of redemptions, the London-based firm said in a statement today. Assets under management rose to $57.7 billion from $54.1 billion on Dec. 31. Peter Lenardos, an analyst at RBC Capital Markets who rates Man Group perform, estimated the company would increase assets to $57.4 billion.
Man Group has benefited from cost-cutting by Chief Executive Officer Emmanuel Roman and gains for its largest fund, AHL Diversified, which rose 12.5 percent in 2014 after three years of losses. Investors have also added money to funds managed by the firms GLG Partners unit over the past year, as they became less concerned that slow economic growth in Europe will hurt returns.
Whilst it has been a positive first half for the firm and we recorded another quarter of net inflows in the second quarter, we remain cautious as we look to the second half of the year, Roman, 50, said in the statement. Investment performance in the first half was mixed amid a continued volatile market environment.
Adjusted pretax profit rose 10 percent to $148 million in the first half from a year earlier, the company said.
The stock dropped 5.6 percent to 119 pence in London trading yesterday, paring gains this year to 40 percent and valuing the company at 2.1 billion pounds ($3.5 billion).
U.S. Acquisitions
Man Group has been expanding in the U.S. as it seeks to diversify its range of funds. The company said in June it would buy Boston-based Numeric Holdings LLC for as much as $494 million, and Pine Grove Asset Management LLC, a New Jersey-based investment firm that manages about $1 billion. The firm said after the Numeric deal it would have about $200 million in surplus regulatory capital remaining.
AHL Diversified, which relies on computer models to capture profitable moves in bonds, commodities and currencies, advanced 8.7 percent in the first half, according to data compiled by Bloomberg. Hedge funds rose 3.2 percent on average in the period, according to Chicago-based Hedge Fund Research Inc.
Investors began pulling money from AHL in 2011 after actions by politicians and central banks broke up trends in asset prices, contributing to losses for the hedge fund. Its gains in 2014 mark the best start to a year since it surged 16 percent over the first half of 2008.
Roman replaced former CEO Peter Clarke in February last year. He joined the company in 2010 as part of its acquisition of London-based GLG Partners.
