Jupiter Fund Management plc -
Interim Report and Accounts 2024
Results for the six months ended
30 June 2024
26 July 2024
A
solid first half with reasons for cautious
optimism
§ We have
delivered a solid set of financial results for H1 2024 that are in
line with our expectations, and we are continuing to make progress
against each of our strategic objectives
§ Underlying profit before tax increased 3% to £47.9m (H1 2023:
£46.4m) and statutory profit before tax grew 11% to £38.7m (H1
2023: £34.8m)
§ We
remain committed to careful and deliberate capital allocation and
cost management. Total operating costs decreased by 2% to £129.1m
(H1 2023: £132.2m)
§ We saw
an increase in gross flows from retail clients, with total gross
flows of £7.5bn (H2 2023: £5.5bn)
§ There
were total net outflows of £3.4bn, driven by the expected impact of
changes to the Value equity team and the management of the
Chrysalis Investment Trust. Underlying net outflows, excluding
these impacts, were £0.2bn
§ In line
with our capital allocation policy, we announce an ordinary
dividend of 3.2p per share
|
Six
months ended
30 June
2024
|
Six
months ended
30 June
2023
|
Year
ended
31
December 2023
|
AUM (£bn)
|
51.3
|
51.4
|
52.2
|
Net flows (£bn)
|
(3.4)
|
-
|
(2.2)
|
Net revenue1
(£m)
|
173.7
|
181.0
|
368.8
|
Statutory profit before
tax2 (£m)
|
38.7
|
34.8
|
9.4
|
Basic earnings per share
(EPS)2 (p)
|
5.4
|
4.6
|
(2.5)
|
Underlying profit before
tax1 (£m)
|
47.9
|
46.4
|
105.2
|
Underlying EPS1
(p)
|
6.6
|
6.7
|
14.8
|
Total dividends per
share
|
3.2
|
6.4
|
9.8
|
Cost:income
ratio1
|
74%
|
71%
|
73%
|
1 The Group's use
of alternative performance measures (APMs) is explained on pages 25
to 28.
2 IFRS measures.
Matthew Beesley, Chief
Executive Officer, commented:
"Jupiter delivered a solid financial
performance during the first half of the year consistent with our
expectations despite experiencing outflows, which were nearly all
associated with changes in the Value team and to the management of
the Chrysalis Investment Trust. Our underlying profit before tax
increased by 3%, supported by a continuous focus on cost management
which saw total operating costs continue to fall. I believe we have
a business and a structure which positions us well for success
given our work to date to right-size our business, invest in
strategic growth drivers, and bring in highly regarded investment
talent.
There are reasons to be cautiously optimistic. Our underlying
outflows were small at just £0.2bn and we saw an increase in gross
flows to £7.5bn, driven by an improvement in demand from retail
clients. These positive flows were spread across a number of our
capabilities, including Systematic equities and Asian &
Emerging Market equities.
As
we look forward, like other market participants, we are beginning
to see early signs of client sentiment shifting more favourably in
the UK where we have deep client relationships and leading
investment capabilities. Markets have responded
positively to the increased political stability in the UK that
comes with the incoming Government and if this improvement in
sentiment is sustained, Jupiter is likely to be a strong
beneficiary."
Analyst
presentation
There will be a virtual analyst
presentation at 10:00am BST on 26 July 2024.
The presentation
will be accessible via a live webcast, which will
be available at: https://secure.emincote.com/client/jupiter/jfm039.
Please note that questions can be asked via the webcast.
The results announcement and the
presentation will be available at https://www.jupiteram.com/investor-relations. Copies
may also be obtained from the registered office of the Company at
The Zig Zag Building, 70 Victoria Street, London, SW1E
6SQ.
The interim report and accounts
will be available on the Group's website at: https://www.jupiteram.com/investor-relations.
For further information please
contact:
|
|
|
Investors
|
Media
|
Jupiter
|
Alex James
+44 (0)20 3817 1636
|
Victoria Howley
+44 (0)20 3817 1657
|
|
|
|
Edelman Smithfield
|
|
Andrew Wilde
+44 (0)7786 022 022
|
|
|
|
LEI Number:
5493003DJ1G01IMQ7S28
Forward-looking
statements
This announcement contains
forward-looking statements with respect to the financial condition,
results of operations and businesses of the Group. Such statements
and forecasts involve risk and uncertainty because they relate to
events and depend upon circumstances in the future. There are a
number of factors that could cause actual results or developments
to differ materially from those expressed or implied by
forward-looking statements and forecasts. Forward-looking
statements and forecasts are based on the Directors' current view
and information known to them at the date of this announcement. The
Directors do not make any undertaking to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. Nothing in this announcement should be
construed as a profit forecast.
Management statement
We are pleased to report a solid
start to 2024, with continued progress against our strategic
objectives and financial results that are in line with or, in some
cases, ahead of our expectations.
We saw total net outflows of
£3.4bn, with £0.8bn due to the change in management of the
Chrysalis Investment Trust and £2.4bn from strategies managed by
the Value desk. There were total underlying net outflows (i.e.
excluding the impact of these two changes) of £0.2bn, broadly in
line with our expectation of flat underlying flows for the full
year.
On this underlying basis, we saw
small net positive flows in the retail, wholesale and investment
trust channel, driven by demand for Indian equities, Asian Income
and both equity and fixed income absolute return strategies.
Although underlying flows from the Institutional channsefel were
net negative in terms of AUM, they were net positive in terms of
revenue contribution on a run-rate basis, with gross inflows into
higher margin areas.
Although interest rates remain high
and valuations of UK-listed companies are low relative to both
their own history and other developed markets, there are reasons to
be cautiously optimistic and there are early signs of an
improvement in UK investor sentiment, particularly in the retail
and wholesale channel.
We remain resolutely focused on the
aspects of the business that we can control and employ a
thoughtful, strategic approach to our resource allocation. As a
result of this discipline, and not withstanding some seasonality,
total operating costs in the first half were lower than market
expectations, leading to a 3% increase in underlying profit before
tax of £47.9m (H1 2023: £46.4m).
Our capital base remains very
strong and we have today announced an ordinary dividend of 3.2p per
share, in line with our capital allocation policy of returning 50%
of pre-performance fee earnings per share.
Progress against our strategic
objectives
We continue to manage our business
with focus on our four key objectives of increasing scale,
decreasing undue complexity, broadening our appeal to clients and
deepening relationships with all stakeholders.
Although there were short-term
specific challenges, we continue to see strong momentum as we look
to increase scale in the Institutional channel. The majority of the
£1.6bn of net outflows in this channel were from strategies managed
by the Value team. Although there were £0.3bn of underlying
outflows from institutional clients, these movements resulted in
net positive revenue contribution on a run-rate basis. Our
international business remains strong and well-diversified, with
inflows from clients based in Asia and Latin America almost
offsetting outflows from unconstrained fixed income strategies from
clients based in continental Europe.
We have continued to remove undue
complexity from the business, through both careful and disciplined
management of our cost base and direct management actions. Although
the discrete programme of fund rationalisation is largely complete,
ongoing curation of the product range will see a net reduction in
the total number of funds by the year end. Our focus remains on
ensuring we have differentiated investment capabilities and
considering whether evolving client needs present us with an
opportunity to allow them to access these capabilities through
different structures or constructs. We have also continued to
invest in data and technology, most notably around enhancing our
scalable platform, with the aim of delivering on that operational
leverage opportunity.
This focus will allow us to remove
undue complexity, automating formerly manual processes and
delivering increasingly bespoke, personalised levels of client
service and reporting. In turn, along with strengthening our
ability to provide customised solutions, this approach will enable
us to broaden our appeal to clients.
Finally, we continue to deepen
relationships with all our stakeholders, including our clients,
with whom we will continue to actively engage to ensure that we
understand their evolving needs. Our people are another key
stakeholder and I am pleased to report that our latest opinion
survey showed an engagement score of 76%, higher, once more, than
the financial services benchmark1. With regards to our
shareholders, our ordinary dividend announced today is in line with
our capital allocation policy and we will continue to build a
business that delivers consistent shareholder value.
1.
Engagement score of 76% is based upon our most recent employee
'pulse' opinion survey, conducted in May 2024. The benchmark of 74%
is provided by People Insight and comprises engagement scores of
all financial services who provide data to them.
Improving gross flows and
underlying net flows
Following market weakness in the
second half of last year, gross flows saw an improvement in the
first half of 2024 to £7.5bn (H2 2023: £5.5bn), driven by an
increase in demand from retail clients.
We saw total net outflows of £3.4bn
in the first half of 2024. This was driven by £2.4bn of net
outflows from strategies managed by the Value team and £0.8bn
following the change in arrangements of the management of the
Chrysalis Investment Trust. Excluding the impact of these two
factors, we saw total underlying net outflows of £0.2bn.
The net redemptions from strategies
managed by the Value team included £1.3bn from institutional
clients and £1.1bn from retail and wholesale clients. The team now
manage £6.3bn of externally managed assets, £1.7bn of which is on
behalf of institutional clients and £4.6bn for retail clients.
£3.4bn of the managed assets are held in segregated
mandates.
Encouragingly, we generated
slightly net positive underlying flows in the retail, wholesale and
investment trust channel. This was driven by strong demand for our
Asian and Emerging Market equities capability, most notably our
Indian equity and wider Asian Income strategies. Our Systematic
equities capability also saw inflows, driven by strong investment
performance and ongoing client demand for the Global Equity
Absolute Return Fund.
Institutional flows, which are
always more lumpy in nature, were more muted in the first half and
saw small net outflows, which was almost all due to the expected
redemption of a lower margin mandate. On an underlying basis,
although Institutional flows were net negative in terms of AUM,
they were net positive in terms of revenue contribution on a
run-rate basis.
Although these net outflows were
partially offset by positive market and other movements of £2.5bn,
total closing AUM decreased by 2% to £51.3bn (31 December 2023:
£52.2bn).
|
31
December 2023
£bn
|
Q1 net
flows
£bn
|
Q2 net
flows
£bn
|
H1 net
flows
£bn
|
Market
and other movements
£bn
|
30 June
2024
£bn
|
Retail, wholesale & investment
trusts
|
42.2
|
(0.8)
|
(1.0)
|
(1.8)
|
2.0
|
42.4
|
Institutional
|
10.0
|
(0.8)
|
(0.8)
|
(1.6)
|
0.5
|
8.9
|
Total
|
52.2
|
(1.6)
|
(1.8)
|
(3.4)
|
2.5
|
51.3
|
of which is invested in mutual funds
|
38.1
|
(0.3)
|
(0.6)
|
(0.9)
|
1.7
|
38.9
|
Solid financial
performance
Despite the well-known headwinds
and an ongoing uncertain market backdrop, we delivered solid
financial performance in the first half of 2024.
Underlying profit before tax and
exceptional items increased by 3% to £47.9m (H1 2023: £46.4m), with
statutory profit before tax up 11% to £38.7m (H1 2023: £34.8m).
Excluding the impact of net performance fees, underlying profit
before tax and exceptional items was £46.6m (H1 2023:
£49.5m).
Including net performance fees,
underlying EPS was 6.6p (H1 2023: 6.7p) and basic statutory EPS was
5.4p (H1 2023: 4.6p). Underlying EPS, excluding the impact of net
performance fees, was 6.4p (H1 2023: 7.1p).
Driven by market gains, average AUM
increased to £52.1bn (H1 2023: £50.9bn). However, with the
strategic introduction of tiered pricing on our UK-domiciled fund
ranges and the evolution of the business towards institutional
clients, the average fee margin in the first half was 65bps (FY
2023: 70bps). This is slightly lower than guidance for the full
year, but is a result of the timing of flows, which we expect to
drive up net revenue margins in the second half. The guidance of
66bps for the full-year 2024 net revenue margin remains
unchanged.
As a result of these changes, net
revenue was 4% lower at £173.7m (H1 2023: £181.0m), including £3.9m of performance
fees (H1 2023: £0.4m).
Thoughtful and strategic allocation
of costs remains a key focus at Jupiter. Although there is some
seasonality in our cost base, with a greater weighting towards the
second half, costs are largely as we expected for the
period.
Fixed staff costs of £38.8m (H1
2023: £37.0m) were in line with guidance. Variable staff costs of
£41.0m (H1 2023: £41.4m) reflect a 45% total compensation ratio
(excluding the net impact of performance fees), which is two
percentage points lower than our guidance for the full year.
Although there is some seasonality in these costs, it is possible
that we will now be able to deliver a full-year compensation ratio
in the region of 46%.
Non-compensation costs also
continue to be carefully managed at £49.3m (H1 2023: £53.8m).
Again, there is some seasonality here and we would expect
non-compensation costs to be higher in the second half.
Nonetheless, through direct management actions we now reasonably
expect full-year non-compensation costs to be £109m, £2m lower than
previous guidance.
Our disciplined approach towards
our cost base remains unchanged. Our investments are focused on
areas which will either realise growth opportunities which will add
scale to the revenue base, build further efficiencies in our
scalable platform that will deliver operational leverage or drive
value for money from existing mandatory spend.
Total expenses before exceptional
items were 2% lower than the first half of 2023 at £129.1m (H1
2023: £132.2m). Excluding the impact of performance fee-related pay
and exceptional items, the Group's total administrative expenses
were £126.5m (H1 2023: £128.7m).
There were exceptional items of
£9.2m (H1 2023: £11.6m), which solely comprised amortisation of
intangible assets relating to the 2020 Merian acquisition. No
further exceptional items are expected in the second half of the
year.
|
|
Six
months ended 30 June 2024
|
Six
months ended 30 June 2023
|
|
£m
|
|
Before
net
performance
fees
|
Net
performance fees
|
Total
|
Before net
performance
fees
|
Net performance
fees
|
Total
|
|
Net revenue
|
|
169.8
|
3.9
|
173.7
|
180.6
|
0.4
|
181.0
|
Compensation costs
|
|
(77.2)
|
(2.6)
|
(79.8)
|
(74.9)
|
(3.5)
|
(78.4)
|
Non-compensation costs
|
|
(49.3)
|
-
|
(49.3)
|
(53.8)
|
-
|
(53.8)
|
Administrative expenses1
|
|
(126.5)
|
(2.6)
|
(129.1)
|
(128.7)
|
(3.5)
|
(132.2)
|
Other gains
|
|
3.5
|
-
|
3.5
|
0.4
|
-
|
0.4
|
Amortisation of intangible
assets2
|
|
(1.2)
|
-
|
(1.2)
|
(1.0)
|
-
|
(1.0)
|
Operating profit before exceptional items
|
|
45.6
|
1.3
|
46.9
|
51.3
|
(3.1)
|
48.2
|
Net finance
income/(costs)
|
|
1.0
|
-
|
1.0
|
(1.8)
|
-
|
(1.8)
|
Profit before taxation and exceptional
items
|
|
46.6
|
1.3
|
47.9
|
49.5
|
(3.1)
|
46.4
|
Exceptional items
|
|
(9.2)
|
-
|
(9.2)
|
(11.6)
|
-
|
(11.6)
|
Statutory profit before tax
|
|
37.4
|
1.3
|
38.7
|
37.9
|
(3.1)
|
34.8
|
|
|
|
|
|
|
|
|
|
|
| |
1 Administrative expenses in H1
2023 excluded £2.2m of variable staff costs classified as
exceptional.
2 Amortisation of intangible assets
excludes £9.2m classified as exceptional (2023 H1:
£9.4m).
Active, high-conviction
investment
Market dynamics have continued to
create a challenging backdrop for our range of investment
capabilities and, as a result, our aggregate investment performance
measures are lower than we would typically expect.
At 30 June 2024, 55% of our mutual
fund AUM had delivered above-median performance against their peer
group over three years (31 December 2023: 59% of mutual fund AUM),
of which 43% of mutual fund AUM had delivered first quartile
performance (31 December 2023: 41% of mutual fund AUM).
Measured over five years, 57% of
mutual fund AUM (31 December 2023: 66% of mutual fund AUM)
delivered above-median performance, whereas over one year, this was
43% of mutual fund AUM (31 December 2023: 65% of mutual fund
AUM).
The decline over our key three-year
metric was driven by a small number of larger funds moving below
their median, including the European Growth fund, Japanese equity
and some of our Merlin fund of fund strategies.
However, of our 13 funds that have
over £1bn of AUM, nine are above their median over three and five
years. We have also seen some exceptionally strong performance in
smaller funds that are in areas of strong client demand. Of the 21
funds which are in the top quartile over three years, over half of
these are also top decile, including Strategic Absolute Return Bond
fund, Indian equity strategies, Global High Yield and Asian
Income.
Segregated mandates and investment
trusts now make up £12.4bn, or 24% of our AUM (31 December 2023:
£10.9bn, or 21% of our AUM). At the period end, 64% of AUM in this
category were above their benchmarks over three years (31 December
2023: 59%).
A strong capital
base
The Group continues to maintain a
strong capital base.
Our expected capital surplus has
increased to £198.5m at end June 2024, which is around 3.75 times
coverage of our regulatory surplus requirement of £72m.
Our capital allocation policy is to
pay out 50% of underlying EPS before performance fees. In line with
this, the Board have proposed an interim ordinary dividend of 3.2p
per share. The dividend will be paid on 4 September 2024 to
shareholders on the register at the close of business on 9 August
2024.
Our policy, as part of our overall
capital allocation framework, allows us to return capital to
shareholders on a clear, sustainable basis and, if there are no
capital needs, we expect to make further returns of additional
capital to shareholders at the appropriate time.
Looking forward through
2024
Whilst the backdrop remains
uncertain and there are well-publicised challenges to the industry,
our underlying business is performing well and we have delivered a
solid set of financial results.
Our approach to human and capital
resource allocation remains considered and we are focused on
building scale and top-line revenue growth, while driving
efficiencies and removing any undue complexity.
Market sentiment is still far from
buoyant, but there are early signs of cautious optimism for an
improvement in clients' views towards risk assets. With a period of
forthcoming political stability and falling interest rates, and the
possibility of more bold action from the new government, it is not
unreasonable to be hopeful around a potential turnaround in
sentiment in both the UK and in companies who are listed in the
UK. Should this take place, Jupiter remains well-positioned
to capitalise over the medium term.
Matthew Beesley
Chief Executive Officer
25 July 2024
Consolidated income
statement
for the six months ended 30 June
2024
|
|
|
Notes
|
Six
months ended
30 June
2024
|
|
Six months ended
30 June
2023
|
|
Year ended
31
December 2023
|
|
|
£m
|
|
£m
|
|
£m
|
Revenue
|
1
|
192.6
|
|
200.2
|
|
405.6
|
Fee and commission
expenses
|
1
|
(18.9)
|
|
(19.2)
|
|
(36.8)
|
Net revenue
|
1
|
173.7
|
|
181.0
|
|
368.8
|
|
|
|
|
|
|
|
Administrative expenses
|
3
|
(129.1)
|
|
(134.4)
|
|
(265.4)
|
Other gains
|
4
|
3.5
|
|
0.4
|
|
3.2
|
Amortisation of intangible
assets
|
9
|
(10.4)
|
|
(10.4)
|
|
(20.6)
|
Operating profit
|
|
37.7
|
|
36.6
|
|
86.0
|
|
|
|
|
|
|
|
Impairment of goodwill
|
8
|
-
|
|
-
|
|
(76.2)
|
Finance
income1
|
5
|
4.1
|
|
1.3
|
|
5.8
|
Finance
costs1
|
5
|
(3.1)
|
|
(3.1)
|
|
(6.2)
|
Profit before taxation
|
|
38.7
|
|
34.8
|
|
9.4
|
|
|
|
|
|
|
|
Income tax expense
|
6
|
(10.5)
|
|
(10.6)
|
|
(22.3)
|
Profit/(loss) for the period1
|
|
28.2
|
|
24.2
|
|
(12.9)
|
|
|
|
|
|
|
|
Earnings per share
|
|
|
|
|
|
|
Basic
|
7
|
5.4p
|
|
4.6p
|
|
(2.5)p
|
Diluted
|
7
|
5.3p
|
|
4.6p
|
|
(2.5)p
|
1In the Group's 2023 Interim Report and Accounts, these lines
were aggregated as 'Net finance costs'.
Consolidated statement of
comprehensive income
for the six months ended 30 June
2024
|
|
Six
months ended
30 June
2024
|
|
Six months ended
30 June
2023
|
|
Year
ended
31
December 2023
|
|
|
|
£m
|
|
£m
|
|
£m
|
|
|
|
|
|
|
|
|
|
Profit/(loss) for the
period
|
|
28.2
|
|
24.2
|
|
(12.9)
|
|
|
|
|
|
|
|
|
|
Items that may be reclassified subsequently to profit or
loss
|
|
|
|
|
|
|
|
Exchange movements on translation
of subsidiary undertakings
|
|
(0.8)
|
|
(2.1)
|
|
(1.7)
|
|
Other comprehensive loss for the year net of
tax
|
|
(0.8)
|
|
(2.1)
|
|
(1.7)
|
|
|
|
|
|
|
|
|
|
Total comprehensive income/(loss) for the period net of
tax
|
|
27.4
|
|
22.1
|
|
(14.6)
|
|
Consolidated balance
sheet
at 30 June 2024
|
|
|
|
Notes
|
30 June
2024
|
|
30 June
2023
|
|
31
December 2023
|
|
|
|
|
£m
|
|
£m
|
|
£m
|
|
Non-current assets
|
|
|
|
|
|
|
|
|
Goodwill
|
|
8
|
494.4
|
|
570.6
|
|
494.4
|
|
Intangible assets
|
|
9
|
10.2
|
|
26.7
|
|
17.5
|
|
Property, plant and
equipment
|
|
10
|
35.8
|
|
38.9
|
|
37.5
|
|
Investment in
associates
|
|
|
1.8
|
|
-
|
|
1.8
|
|
Deferred tax assets
|
|
|
16.9
|
|
19.4
|
|
16.1
|
|
Trade and other
receivables
|
|
|
0.4
|
|
0.3
|
|
0.4
|
|
|
|
|
559.5
|
|
655.9
|
|
567.7
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
Financial assets
|
|
11
|
469.9
|
|
166.8
|
|
232.8
|
|
Trade and other
receivables
|
|
|
166.7
|
|
205.7
|
|
137.6
|
|
Cash and cash
equivalents
|
|
12
|
206.9
|
|
284.0
|
|
268.2
|
|
Current tax asset
|
|
|
3.7
|
|
3.1
|
|
1.3
|
|
|
|
|
847.2
|
|
659.6
|
|
639.9
|
|
Total assets
|
|
|
1,406.7
|
|
1,315.5
|
|
1,207.6
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to shareholders
|
|
|
|
|
|
|
|
|
Share capital
|
|
14
|
10.9
|
|
10.9
|
|
10.9
|
|
Own share reserve
|
|
15
|
(0.6)
|
|
(0.8)
|
|
(0.7)
|
|
Other reserves
|
|
15
|
250.3
|
|
250.3
|
|
250.3
|
|
Foreign currency translation
reserve
|
|
15
|
1.2
|
|
1.6
|
|
2.0
|
|
Retained earnings
|
|
15
|
543.8
|
|
586.7
|
|
527.0
|
|
Capital and reserves attributable to owners of Jupiter Fund
Management plc
|
|
|
805.6
|
|
848.7
|
|
789.5
|
|
Non-controlling
interests
|
|
|
-
|
|
0.5
|
|
-
|
|
Total equity
|
|
|
805.6
|
|
849.2
|
|
789.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
Loans and borrowings
|
|
13
|
49.8
|
|
49.6
|
|
49.7
|
|
Trade and other
payables
|
|
|
52.3
|
|
81.8
|
|
59.7
|
|
Deferred tax
liabilities
|
|
|
-
|
|
4.5
|
|
2.3
|
|
|
|
|
102.1
|
|
135.9
|
|
111.7
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
Financial liabilities at fair
value through profit or loss
(FVTPL)
|
|
11
|
250.9
|
|
48.5
|
|
80.3
|
|
Trade and other
payables1
|
|
|
243.9
|
|
280.2
|
|
221.4
|
|
Provisions1
|
|
|
3.4
|
|
1.7
|
|
4.7
|
|
Current tax liability
|
|
|
0.8
|
|
-
|
|
-
|
|
|
|
|
499.0
|
|
330.4
|
|
306.4
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
601.1
|
|
466.3
|
|
418.1
|
|
|
|
|
|
|
|
|
|
|
Total equity and liabilities
|
|
|
1,406.7
|
|
1,315.5
|
|
1,207.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
1In the Group's 2023 Interim Report and Accounts, these lines
were aggregated as 'Trade and other payables'.
Consolidated statement of changes
in equity
for the six months ended 30 June
2024
|
|
|
|
Share
capital
|
Own
share
reserve
|
Other
reserves
|
Foreign
currency
translation
reserve
|
Retained
earnings
|
Total
|
Non-controlling interests
|
Total
equity
|
|
|
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
£m
|
|
At 1 January 2023
|
|
10.9
|
(0.5)
|
250.3
|
3.7
|
578.9
|
843.3
|
0.6
|
843.9
|
|
Profit/(loss) for the
period
|
|
-
|
-
|
-
|
-
|
24.3
|
24.3
|
(0.1)
|
24.2
|
|
Exchange movements on translation
of subsidiary undertakings
|
|
-
|
-
|
-
|
(2.1)
|
-
|
(2.1)
|
-
|
(2.1)
|
|
Other comprehensive loss
|
|
-
|
-
|
-
|
(2.1)
|
-
|
(2.1)
|
-
|
(2.1)
|
|
Total comprehensive (loss)/income
|
|
-
|
-
|
-
|
(2.1)
|
24.3
|
22.2
|
(0.1)
|
22.1
|
|
Vesting of ordinary shares and
options
|
|
-
|
0.1
|
-
|
-
|
(0.1)
|
-
|
-
|
-
|
|
Dividends paid
|
|
-
|
-
|
-
|
-
|
(2.6)
|
(2.6)
|
-
|
(2.6)
|
|
Purchase of shares by
EBT
|
|
-
|
(0.4)
|
-
|
-
|
(24.0)
|
(24.4)
|
-
|
(24.4)
|
|
Share-based payments
|
|
-
|
-
|
-
|
-
|
10.2
|
10.2
|
-
|
10.2
|
|
Total transactions with owners
|
|
-
|
(0.3)
|
-
|
-
|
(16.5)
|
(16.8)
|
-
|
(16.8)
|
|
At 30 June 2023
|
|
10.9
|
(0.8)
|
250.3
|
1.6
|
586.7
|
848.7
|
0.5
|
849.2
|
|
(Loss)/profit for the
period
|
|
-
|
-
|
-
|
-
|
(37.2)
|
(37.2)
|
0.1
|
(37.1)
|
|
Exchange movements on translation
of subsidiary undertakings
|
|
-
|
-
|
-
|
0.4
|
-
|
0.4
|
-
|
0.4
|
|
Other comprehensive income
|
|
-
|
-
|
-
|
0.4
|
-
|
0.4
|
-
|
0.4
|
|
Total comprehensive income/(loss)
|
|
-
|
-
|
-
|
0.4
|
(37.2)
|
(36.8)
|
0.1
|
(36.7)
|
|
Vesting of ordinary shares and
options
|
|
-
|
0.1
|
-
|
-
|
(0.1)
|
-
|
-
|
-
|
|
Dividends paid
|
|
-
|
-
|
-
|
-
|
(32.6)
|
(32.6)
|
-
|
(32.6)
|
|
Purchase of shares by
EBT
|
|
-
|
-
|
-
|
-
|
(0.1)
|
(0.1)
|
-
|
(0.1)
|
|
Share-based payments
|
|
-
|
-
|
-
|
-
|
8.3
|
8.3
|
-
|
8.3
|
|
Other movements
|
|
-
|
-
|
-
|
-
|
2.0
|
2.0
|
-
|
2.0
|
|
Disposal of non-controlling
interests
|
|
-
|
-
|
-
|
-
|
-
|
-
|
(0.6)
|
(0.6)
|
|
Total transactions with owners
|
|
-
|
0.1
|
-
|
-
|
(22.5)
|
(22.4)
|
(0.6)
|
(23.0)
|
|
At 31 December 2023
|
|
10.9
|
(0.7)
|
250.3
|
2.0
|
527.0
|
789.5
|
-
|
789.5
|
|
Profit for the period
|
|
-
|
-
|
-
|
-
|
28.2
|
28.2
|
-
|
28.2
|
|
Exchange movements on translation
of subsidiary undertakings
|
|
-
|
-
|
-
|
(0.8)
|
-
|
(0.8)
|
-
|
(0.8)
|
|
Other comprehensive loss
|
|
-
|
-
|
-
|
(0.8)
|
-
|
(0.8)
|
-
|
(0.8)
|
|
Total comprehensive (loss)/income
|
|
-
|
-
|
-
|
(0.8)
|
28.2
|
27.4
|
-
|
27.4
|
|
Vesting of ordinary shares and
options
|
|
-
|
0.1
|
-
|
-
|
(0.1)
|
-
|
-
|
-
|
|
Dividends paid
|
|
-
|
-
|
-
|
-
|
(17.6)
|
(17.6)
|
-
|
(17.6)
|
|
Purchase of shares by
EBT
|
|
-
|
-
|
-
|
-
|
(0.9)
|
(0.9)
|
-
|
(0.9)
|
|
Share-based payments
|
|
-
|
-
|
-
|
-
|
7.2
|
7.2
|
-
|
7.2
|
|
Total transactions with owners
|
|
-
|
0.1
|
-
|
-
|
(11.4)
|
(11.3)
|
-
|
(11.3)
|
|
At 30 June 2024
|
|
10.9
|
(0.6)
|
250.3
|
1.2
|
543.8
|
805.6
|
-
|
805.6
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes
|
|
14
|
15
|
15
|
15
|
15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Consolidated statement of cash
flows
for the six months ended 30 June
2024
|
|
|
|
Notes
|
Six
months ended
30 June
2024
£m
|
|
Six
months ended
30 June
2023
£m
|
|
Year
ended
31
December 2023
£m
|
Cash flows from operating activities
|
|
|
|
|
|
|
Cash generated from
operations
|
17
|
53.1
|
|
55.8
|
|
109.1
|
Income tax paid
|
|
(15.2)
|
|
(12.6)
|
|
(21.1)
|
Net cash inflows from operating activities
|
|
37.9
|
|
43.2
|
|
88.0
|
|
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
|
|
Purchase of intangible
assets
|
9
|
(3.1)
|
|
(1.9)
|
|
(2.9)
|
Purchase of property, plant and
equipment
|
10
|
(1.1)
|
|
(0.3)
|
|
(0.6)
|
Purchase of financial assets at
FVTPL1
|
|
(329.2)
|
|
(61.3)
|
|
(187.0)
|
Proceeds from disposal of
financial assets at FVTPL2
|
|
154.1
|
|
62.1
|
|
131.1
|
Cash movement from funds no longer
consolidated3
|
|
(0.1)
|
|
(1.5)
|
|
(3.1)
|
Dividend income
received
|
|
0.5
|
|
0.3
|
|
0.5
|
Interest income
received4
|
|
3.6
|
|
1.3
|
|
5.4
|
Net cash outflows from investing activities
|
|
(175.3)
|
|
(1.3)
|
|
(56.6)
|
|
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
|
|
Dividends paid
|
16
|
(17.6)
|
|
(2.6)
|
|
(35.2)
|
Purchase of shares by
EBT
|
15
|
(0.9)
|
|
(24.4)
|
|
(24.5)
|
Purchase of shares for
cancellation
|
14
|
-
|
|
(2.0)
|
|
(2.0)
|
Finance costs
paid4
|
|
(4.5)
|
|
(4.5)
|
|
(4.6)
|
Cash paid in respect of lease
arrangements
|
|
(4.1)
|
|
(3.0)
|
|
(4.9)
|
Third-party subscriptions into
consolidated funds
|
|
116.9
|
|
29.9
|
|
63.0
|
Third-party redemptions from
consolidated funds
|
|
(15.3)
|
|
(30.0)
|
|
(34.1)
|
Distributions paid by consolidated
funds
|
|
-
|
|
(0.5)
|
|
(0.1)
|
Net cash inflows/(outflows) from financing
activities
|
|
74.5
|
|
(37.1)
|
|
(42.4)
|
|
|
|
|
[]
|
|
|
Net (decrease)/increase in cash and cash
equivalents
|
|
(62.9)
|
|
4.8
|
|
(11.0)
|
|
|
|
|
[]
|
|
|
Cash and cash equivalents at
beginning of period
|
|
268.2
|
|
280.3
|
|
280.3
|
Effects of exchange rates on cash
and cash equivalents
|
|
1.6
|
|
(1.1)
|
|
(1.1)
|
Cash and cash equivalents at end of period
|
12
|
206.9
|
|
284.0
|
|
268.2
|
1 Includes purchases of seed investments and fund units used as
a hedge against compensation awards linked to the value of those
funds and, where the Group's investment in seed is judged to give
it control of a fund, purchases of financial assets by that
fund.
2 Includes proceeds from disposals of seed investments and,
where the Group's investment in seed is judged to give it control
of a fund, disposals of financial assets by that fund.
3 Comprises cash and cash equivalents held by a fund at the
point that the Group ceases to control the fund and it is no longer
consolidated.
4 In the Group's 2023 Interim Report and Accounts, these lines
were aggregated as 'Net finance costs paid'.
Notes to the Group financial
statements
|
|
Introduction
Jupiter Fund Management plc (the
Company) and its subsidiaries (together, the Group) offer a range
of asset management products. Through its subsidiaries, the Group
acts as an investment manager to authorised unit trusts, SICAVs,
ICVCs, OEICs, investment trust companies, pension funds and other
specialist funds. At 30 June 2024, the Group had offices in the
United Kingdom, Ireland, Germany, Hong Kong, Italy, Luxembourg,
Singapore, Spain, Sweden and Switzerland.
Basis of preparation and other
accounting policies
Within this Interim Report and
Accounts, all current and comparative data covering periods to (or
as at) 30 June are unaudited. Data given in respect of the year
ended 31 December 2023 is audited. Information which is the
required content of the Interim Management Report can be found on
pages 1 to 6, 23, and 25 to 28.
These condensed financial
statements for the six months ended 30 June 2024 have been prepared
in accordance with the Disclosure Guidance and Transparency Rules
sourcebook of the Financial Conduct Authority and with UK-adopted
International Accounting Standard IAS 34 Interim Financial Reporting. The
condensed financial statements should be read in conjunction with
the Group's annual financial statements for the year ended 31
December 2023, which were prepared in accordance with UK-adopted
International Accounting Standards and with the requirements of the
Companies Act 2006 as applicable to companies reporting under those
standards.
The condensed financial statements
do not comprise statutory accounts within the meaning of section
434 of the Companies Act 2006. Statutory accounts for the year
ended 31 December 2023 were approved by the Board on 22 February
2024 and delivered to the Registrar of Companies. The report of the
auditors on those accounts was unqualified, did not contain an
emphasis of matter paragraph and did not contain any statement
under section 498 of the Companies Act 2006. The condensed
financial statements have been reviewed, not audited.
The Group is able to operate within
its available resources even in a stressed scenario. The Directors
have not identified any material uncertainties to the Group's
ability to continue to adopt the going concern basis. As a
consequence, the Directors have a reasonable expectation that the
Group has adequate resources to continue operating for a period of
at least 12 months from the date of approval of the condensed
financial statements. Accordingly, they continue to adopt the going
concern basis of accounting in preparing these financial
statements.
New accounting standards
The International Accounting
Standards Board (IASB) and IFRS Interpretations Committee (IC) have
issued a number of new accounting standards and interpretations and
amendments to existing standards and interpretations. Other than
IFRS 18, there are no IFRSs or IFRS IC interpretations that are not
yet effective that would be expected to have a material impact on
the Group.
The IASB issued IFRS 18
Presentation and Disclosure in
Financial Statements on 9 April 2024. The standard, which is
effective for periods beginning on or after 1 January 2027, aims to
improve comparability and transparency of communication in
financial statements, and replaces IAS 1 Presentation of Financial Statements.
The Group has not applied IFRS 18 in these financial
statements.
IFRS 18 introduces new
presentational requirements within the income statement, including
specified totals and sub-totals. It also requires disclosure of
management-defined performance measures and requirements for
aggregation and disaggregation of financial information based on
the identified roles of the primary financial statements and notes
to the accounts. The new requirements are expected to impact the
presentation, but not the recognition or measurement, of items in
the income statement, the cash flow statement and relevant notes to
the accounts, including what the Group currently reports as its
'Operating profit'.
Accounting policies
The accounting policies applied are
consistent with those applied in the Group's annual financial
statements for the year ended 31 December 2023.
1.
Revenue
The Group's primary source of
recurring revenue is management fees. Management fees are charged
for investment management or administrative services and are
normally based on an agreed percentage of AUM. Initial charges and
commissions are for additional administrative services at the
beginning of a client relationship, as well as ongoing
administrative costs. Performance fees may be earned from some
funds or clients when agreed performance conditions are met. Net
revenue is stated after fee and commission expenses to
intermediaries for ongoing services under distribution
agreements.
|
Six
months ended
30 June 2024
£m
|
|
Six
months ended
30 June 2023
£m
|
|
Year
ended
31
December 2023
£m
|
Management fees
|
187.5
|
|
198.5
|
|
389.9
|
Initial charges and
commissions
|
1.2
|
|
1.3
|
|
2.5
|
Performance fees
|
3.9
|
|
0.4
|
|
13.2
|
Revenue
|
192.6
|
|
200.2
|
|
405.6
|
Fee and commission expenses
relating to management fees
|
(18.5)
|
|
(18.7)
|
|
(35.9)
|
Fees and commission expenses
relating to initial charges and commissions
|
(0.4)
|
|
(0.5)
|
|
(0.9)
|
Net revenue
|
173.7
|
|
181.0
|
|
368.8
|
2. Segmental
reporting
The Group offers a range of
products and services through different distribution channels. All
financial, business and strategic decisions are made centrally by
the Board of Directors (the Board), which determines the key
performance indicators of the Group. Information is reported to the
chief operating decision maker, the Board, on a single segment
basis. While the Group has the ability to analyse its underlying
information in different ways, for example by product type, this
information is only used to allocate resources and assess
performance for the Group as a whole. On this basis, the Group
considers itself to be a single-segment investment management
business.
3.
Administrative expenses
|
Six
months ended
30 June 2024
£m
|
|
Six
months ended
30 June 2023
£m
|
|
Year
ended
31
December 2023
£m
|
Staff costs
|
81.2
|
|
79.3
|
|
159.6
|
Depreciation of property, plant and
equipment
|
2.8
|
|
2.6
|
|
5.2
|
Other administrative
expenses
|
46.5
|
|
51.2
|
|
102.1
|
Administrative expenses before net (gains)/losses arising
from economic hedging of fund awards
|
130.5
|
|
133.1
|
|
266.9
|
Net (gains)/losses on instruments
held to provide an economic hedge for fund awards
|
(1.4)
|
|
1.3
|
|
(1.5)
|
Total administrative expenses
|
129.1
|
|
134.4
|
|
265.4
|
4. Other
gains
Other gains relate principally to
net gains made on the Group's seed investment portfolio and
derivative instruments held to provide economic hedges against that
portfolio. The portfolio and derivatives are held at FVTPL (see
Note 11). Gains and losses on these investments comprise both
realised and unrealised amounts.
|
Six
months ended
30 June 2024
£m
|
|
Six
months ended
30 June 2023
£m
|
|
Year
ended
31
December 2023
£m
|
Dividend income
|
0.5
|
|
0.3
|
|
0.6
|
Net gains on financial instruments designated at FVTPL upon initial
recognition
|
9.6
|
|
2.5
|
|
8.2
|
Net losses on financial instruments
at FVTPL
|
(6.6)
|
|
(2.4)
|
|
(5.6)
|
Other gains
|
3.5
|
|
0.4
|
|
3.2
|
5. Finance
income and finance costs
Finance income comprises income
earned on the Group's cash and cash equivalents, being bank
deposits and investments in short-term money market funds. Interest
on cash and cash equivalents is recognised on an accrual basis
using the effective interest method.
|
Six
months ended
30 June 2024
£m
|
|
Six
months ended
30 June 2023
£m
|
|
Year
ended
31
December 2023
£m
|
Interest on bank
deposits
|
1.9
|
|
1.3
|
|
3.5
|
Interest on short-term money market
fund investments
|
2.2
|
|
-
|
|
2.3
|
|
4.1
|
|
1.3
|
|
5.8
|
Finance costs principally relate to
interest payable on Tier 2 subordinated debt notes (see Note 13)
and the unwinding of the discount applied to lease liabilities.
Finance costs also include ancillary charges for commitment fees
and arrangement fees associated with the revolving credit facility.
Interest payable is charged on an accrual basis using the effective
interest method.
|
Six
months ended
30 June 2024
£m
|
|
Six
months ended
30 June 2023
£m
|
|
Year
ended
31
December 2023
£m
|
Interest on subordinated
debt
|
2.3
|
|
2.3
|
|
4.5
|
Interest on lease
liabilities
|
0.7
|
|
0.7
|
|
1.5
|
Finance cost on the revolving
credit facility
|
0.1
|
|
0.1
|
|
0.2
|
|
3.1
|
|
3.1
|
|
6.2
|
6. Income tax
expense
Analysis of charge in the
period:
|
Six
months ended
30 June 2024
£m
|
|
Six
months ended
30 June 2023
£m
|
|
Year
ended
31
December 2023
£m
|
Current tax
|
|
|
|
|
|
Tax on profits for the
period
|
13.7
|
|
12.7
|
|
24.1
|
Adjustments in respect of prior
periods
|
(0.1)
|
|
-
|
|
(0.7)
|
Total current tax
|
13.6
|
|
12.7
|
|
23.4
|
Deferred tax
|
|
|
|
|
|
Origination and reversal of
temporary differences
|
(3.1)
|
|
(2.1)
|
|
0.1
|
Adjustments in respect of prior
periods
|
-
|
|
-
|
|
(1.2)
|
Total deferred tax
|
(3.1)
|
|
(2.1)
|
|
(1.1)
|
|
|
|
|
|
22.3
|
Income tax expense
|
10.5
|
|
10.6
|
|
22.3
|
The weighted average UK corporate
tax rate for 2024 FY is 25% (2023 FY: 23.5%). The UK
corporation tax rate increased from 19% to 25% on 1 April 2023. The
effective tax rate used for the period to 30 June 2024 is 27.1%,
compared to 30.5% for the six months ended 30 June 2023.
The decrease in the effective tax
rate is primarily due to an increase in fund unit share prices in
2024 compared to 2023. This benefit is slightly offset by a smaller
adverse movement in the share price of share-based payments in 2024
compared to 2023. In addition, there was a greater level of
disallowable expenditure in 2024 compared to 2023. Combined, these
factors give rise to an effective tax rate of 27.1% which is
slightly higher than the UK statutory rate of 25%.
7. Earnings
per share (EPS)
Basic EPS is calculated by dividing
the profit for the period attributable to equity holders of Jupiter
Fund Management plc (the parent company of the Group) by the
weighted average number of ordinary shares outstanding and
contingently issuable during the period, less the weighted average
number of own shares held. Own shares are shares held in an EBT for
the benefit of employees under the vesting, lock-in and other
incentive arrangements in place.
Diluted EPS is calculated by
dividing the profit for the period (as used in the calculation of
basic EPS) by the weighted average number of ordinary shares
outstanding during the period for the purpose of basic EPS, plus
the weighted average number of ordinary shares that would be issued
on the conversion of all the dilutive potential ordinary shares
into ordinary shares.
The weighted average number of
ordinary shares used in the calculation of EPS is as
follows:
Weighted average number of
shares
|
Six
months ended
30 June 2024
Number
million
|
|
Six
months ended
30 June 2023
Number
million
|
|
Year
ended
31
December 2023
Number
million
|
Issued share
capital1
|
545.0
|
|
545.1
|
|
545.0
|
Add: Contingently issuable
shares2
|
8.2
|
|
5.9
|
|
6.2
|
Less: Time-apportioned own shares
held
|
(31.8)
|
|
(28.1)
|
|
(31.9)
|
Weighted average number of ordinary shares for the purpose of
basic EPS
|
521.4
|
|
522.9
|
|
519.3
|
Add: Weighted average number of
dilutive potential shares
|
7.2
|
|
8.8
|
|
-3
|
Weighted average number of ordinary shares for the purpose of
diluted EPS
|
528.6
|
|
531.7
|
|
519.3
|
1The Group purchased and cancelled 1.4m ordinary shares during
the first half of 2023 (see Note 14).
2Contingently issuable shares relate to vested but unexercised
share-based payment awards at the balance sheet date.
3Potential shares can only be treated as dilutive if their
conversion to ordinary shares increases the loss per share. As the
impact of including potential shares in the calculation of 2023 EPS
would be to decrease the loss per share, they have been excluded
from the calculation.
EPS
|
Six
months ended
30 June 2024
Pence
|
|
Six
months ended
30 June 2023
Pence
|
|
Year
ended
31
December 2023
Pence
|
Basic
|
5.4
|
|
4.6
|
|
(2.5)
|
Diluted
|
5.3
|
|
4.6
|
|
(2.5)
|
8.
Goodwill
Goodwill arising on acquisitions,
being the excess of the cost of a business combination over the
fair value of the identifiable assets, liabilities and contingent
liabilities acquired, is capitalised in the consolidated balance
sheet. Goodwill is carried at cost less provision for impairment.
The carrying value of goodwill is not amortised but is tested
annually for impairment or more frequently if any indicators of
impairment arise. Goodwill is allocated to cash-generating units
(CGUs) for the purpose of impairment testing, with the allocation
to those CGUs or groups of CGUs that are expected to benefit from
the business combination in which the goodwill arose. Impairment
losses on goodwill are not reversed.
Goodwill relates to the 2007
acquisition of Knightsbridge Asset Management Limited (KAML) and
the 2020 acquisition of Merian Global Investors Limited
(Merian).
|
30 June 2024
£m
|
|
30 June 2023
£m
|
|
31 December 2023
£m
|
Goodwill
|
494.4
|
5
|
570.6
|
|
494.4
|
|
494.4
|
|
570.6
|
|
494.4
|
|
|
|
|
|
|
The Group operates as a single
asset management business segment and does not allocate costs
between investment strategies or individual funds. The businesses
acquired to which the goodwill relates are fully integrated and are
not separately measured or monitored. It is not possible to assign
any reduction in the Group's profitability between the acquired
businesses, and therefore we adopt a single CGU and consider our
impairment test based on Group-wide cash generation to calculate
the recoverable amount of the goodwill, using the higher of the
value in use (VIU) and fair value less costs of disposal of the
CGU, and comparing this to the carrying value of the
CGU.
For the impairment test, the
recoverable amount for the goodwill asset is calculated using a
value in use approach, based on the net present value of the
Group's future earnings. The net present value is calculated using
a discounted cash flow model, with the following key
assumptions:
§ The
Group's projected base case forecast cash flows over a period of
four and a half years to the end of 2028, which includes an
assumption of annual revenue growth based on our expectations of
AUM growth, client fee rates and performance fees. The data has
been taken from the five-year plan, which was approved by the Board
in February 2024, updated for actual results to 30 June
2024;
§ Long-term
growth rates of 2% (2023 FY: 2%) were used to calculate terminal
value; and
§ A
post-tax discount rate of 14.8% (2023 FY: 13.2%) was calculated
using the capital asset pricing model. Using a pre-tax discount
rate of 19.1% (2023 FY: 17.0%) on pre-tax profitability and cash
flows does not produce a materially different result.
The impairment test performed
indicates positive headroom of recoverable amount over carrying
value of £45m at 30 June 2024. The value in use of the asset is
higher than its fair value less costs of disposal. Our conclusion
therefore is that the Group's goodwill asset is not currently
impaired.
The sensitivity of the Group's
current headroom position to reasonably possible changes in key
assumptions used in the value in use calculation is shown in the
table below.
Key variable
|
Reasonably possible adverse movement
|
|
Reduction in headroom
£m
|
|
|
|
|
Discount rate
|
+1%
|
|
43
|
Terminal growth rate
movement
|
-1%
|
|
27
|
Decrease in revenue
|
-10%
|
|
1881
|
1The decrease in revenue represents a modelled percentage
reduction in each year projected in the Group's base case forecast
cash flows.
The sensitivities modelled above
represent the estimated impact on each metric in isolation and make
no allowance for actions management would take to reduce costs
should the Group experience future reductions in AUM or
profitability.
9.
Intangible assets
At 30 June 2024, intangible assets
comprise computer software. In prior periods, intangible assets
principally comprised investment management contracts acquired as
part of the Merian transaction. These contract assets are now fully
amortised.
During the period, the Group
acquired computer software of £3.1m (2023 H1: £1.9m, 2023 FY:
£2.9m). There were no disposals (2023 H1 and 2023 FY: same). These
assets are amortised on a straight-line basis over their estimated
useful lives, which are estimated as being between five and ten
years.
The amortisation charge for the
period was £10.4m (2023 H1: £10.4m, 2023 FY:
£20.6m).
|
30 June 2024
£m
|
|
30 June
2023
£m
|
|
31
December 2023
£m
|
Intangible assets
|
10.2
|
|
26.7
|
|
17.5
|
|
10.2
|
|
26.7
|
|
17.5
|
The management statement of this
document refers to exceptional items of £9.2m (2023 H1: £9.4m, 2023
FY: £18.8m) relating to amortisation of intangible assets. This
charge is in respect of the Merian acquisition in 2020.
10. Property, plant and
equipment
The net book value of property,
plant and equipment at 30 June 2024 was £35.8m (2023 H1: £38.9m,
2023 FY: £37.5m). During the period, the Group acquired items of
property, plant and equipment (excluding right-to-use leased
assets) with a value of £1.1m (2023 H1: £0.3m, 2023 FY: £0.6m).
Additions to the right-of-use leased assets during the period were
£nil (2023 H1: £0.3m, 2023 FY: £0.6m).
11. Financial
instruments
As at 30 June 2023, the Group held
the following classes of financial instruments, which principally
comprise seed investments and assets held to hedge compensation
awards:
|
|
|
|
|
|
|
30 June 2024
£m
|
|
30 June
2023
£m
|
|
31
December 2023
£m
|
Financial assets
|
|
|
|
|
|
Investments in
associates
|
1.2
|
|
-
|
|
-
|
Direct seed investment at fair
value
|
145.0
|
|
65.2
|
|
87.5
|
Financial assets due to
consolidation of funds
|
244.3
|
|
44.6
|
|
76.8
|
Derivatives and fund unit
hedges
|
63.5
|
|
57.0
|
|
55.1
|
Financial assets at FVTPL
|
454.0
|
|
166.8
|
|
219.4
|
Financial assets at amortised
cost
|
15.9
|
|
-
|
|
13.4
|
|
469.9
|
|
166.8
|
|
232.8
|
|
30 June 2024
£m
|
|
30 June
2023
£m
|
|
31
December 2023
£m
|
Financial liabilities at FVTPL
|
|
|
|
|
|
Financial liabilities due to
consolidation of funds
|
(250.8)
|
|
(48.5)
|
|
(80.2)
|
Derivatives
|
(0.1)
|
|
-
|
|
(0.1)
|
|
(250.9)
|
|
(48.5)
|
|
(80.3)
|
12. Cash and cash
equivalents
|
30 June 2024
£m
|
|
30 June
2023
£m
|
|
31
December 2023
£m
|
Cash at bank and in hand
|
100.9
|
|
281.1
|
|
137.5
|
Cash equivalents
|
102.2
|
|
-
|
|
128.4
|
Cash held by the EBT and seed
investment subsidiaries
|
3.8
|
|
2.9
|
|
2.3
|
Total cash and cash equivalents
|
206.9
|
|
284.0
|
|
268.2
|
Cash and cash equivalents have an
original maturity of three months or less. Cash at bank earns
interest at the current prevailing daily bank rates. Cash
equivalents comprise units in short-term money market funds that
can readily be converted into known amounts of cash and which are
subject to an insignificant risk of changes in value.
Cash held by the EBT and seed
investment subsidiaries is not available for use by the
Group.
13. Loans and
borrowings
On 27 April 2020 the Group issued
£50.0m of Tier 2 subordinated debt notes at a discount of £0.5m.
Issue costs were £0.5m and the net proceeds were therefore £49.0m.
These notes will mature on 27 July 2030 and bear interest at a rate
of 8.875% per annum to 27 July 2025, and at a reset rate
thereafter. The Group has the option to redeem all of the notes
from 27 April 2025 onwards.
|
30 June 2024
£m
|
|
30 June
2023
£m
|
|
31
December 2023
£m
|
Subordinated debt in
issue
|
49.8
|
|
49.6
|
|
49.7
|
|
49.8
|
|
49.6
|
|
49.7
|
14. Share
capital
In early 2023, the Group purchased
and cancelled 1.4m shares at a cost of £2.0m. On cancellation of
the shares, an amount equal to their nominal value was transferred
to a capital redemption reserve which forms part of 'Other
reserves', as detailed in Note 15.
|
Number
of ordinary shares
|
|
30 June 2024
million
|
|
30 June
2023
million
|
|
31
December 2023
million
|
Ordinary shares of 2p
each
|
545.0
|
|
545.0
|
|
545.0
|
|
545.0
|
|
545.0
|
|
545.0
|
|
Number
of ordinary shares
|
Par
value
|
|
30 June
2024
m
|
30 June
2023
m
|
31
December 2023
m
|
30 June
2024
£m
|
30 June
2023
£m
|
31
December 2023
£m
|
Movement in ordinary shares
|
|
|
|
|
|
|
At 1 January
|
545.0
|
546.4
|
546.4
|
10.9
|
10.9
|
10.9
|
Shares cancelled
|
-
|
(1.4)
|
(1.4)
|
-
|
-
|
-
|
At the end of the period
|
545.0
|
545.0
|
545.0
|
10.9
|
10.9
|
10.9
|
15. Reserves
(i) Own
share reserve
The Group operates an EBT for the
purpose of satisfying certain retention awards to employees. The
holdings of this trust, which is funded by the Group, include
shares in Jupiter Fund Management plc that have not vested
unconditionally to employees of the Group. These shares are
recorded at cost and are classified as own shares and are used to
settle obligations that arise from the vesting of share-based
awards.
During the period, the Group
purchased 1.2m (2023 H1: 18.4m, 2023 FY: 18.7m) ordinary shares
with a par value of £0.1m (2023 H1: £0.4m, 2023 FY: £0.4m) for the
purpose of satisfying share option obligations to employees. The
full cost of the purchases was £0.9m (2023 H1: £24.4m, 2023 FY:
£24.5m). The Group disposed of 4.4m (2023 H1: 3.4m, 2023 FY: 7.7m)
own shares to employees in satisfaction of share-based awards with
a nominal value of £0.1m (2023 H1: £0.1m, 2023 FY: £0.2m). At 30
June 2024, 30.7m (2023 H1: 37.9m, 2023 FY: 33.9m) ordinary shares,
with a par value of £0.6m (2023 H1: £0.8m, 2023 FY: £0.7m), were
held as own shares within the Group's EBT.
(ii)
Other reserves
Other reserves comprise the merger
relief reserve of £242.1m (2023 H1 and 2023 FY: £242.1m) formed on
the acquisition of Merian in 2020, £8.0m (2023 H1 and 2023 FY:
£8.0m) that relates to the conversion of Tier 2 preference shares
in 2010, and £0.2m (2023 H1: £0.2m, 2023 FY: £0.2m) of capital
redemption reserve that was transferred from share capital on the
cancellation of shares repurchased in 2022 and 2023 (see Note
14).
(iii)
Foreign currency translation reserve
The foreign currency translation
reserve of £1.2m (2023 H1: £1.6m, 2023 FY: £2.0m) is used to record
exchange differences arising from the translation of the financial
statements of foreign subsidiaries.
(iv)
Retained earnings
Retained earnings of £543.8m (2023
H1: £586.7m, 2023 FY: £527.0m) are the amount of earnings that are
retained within the Group after dividend payments and other
transactions with owners.
16.
Dividends
On 20 May 2024 the Group paid a
final dividend for 2023 of 3.4p per ordinary share. This amounted
to a total payment of £17.6m after taking into account the £0.9m
dividends waived on shares held in the EBT.
The Board has declared an interim
dividend for the period of 3.2p per ordinary share. This dividend
will be paid on 4 September 2024 to ordinary shareholders on the
register at close of business on 9 August 2024 and amounts to
£17.4m before adjusting for any dividends waived on shares in the
EBT.
17. Cash flows generated
from operating activities
|
Six
months ended
30 June
2024
£m
|
|
Six
months ended
30 June 2023
£m
|
|
Year
ended
31
December 2023
£m
|
Operating profit
|
37.7
|
|
36.6
|
|
86.0
|
Adjustments for:
|
|
|
|
|
|
Amortisation of intangible
assets
|
10.4
|
|
10.4
|
|
20.6
|
Depreciation of property, plant
and equipment
|
2.8
|
|
2.6
|
|
5.2
|
Other net
(gains)/losses1
|
(7.8)
|
|
0.3
|
|
(5.0)
|
(Gains)/losses on fund unit
hedges2
|
(1.4)
|
|
1.3
|
|
(1.5)
|
Share-based payments
|
7.2
|
|
10.2
|
|
18.5
|
Increase in trade and other
receivables3
|
(14.8)
|
|
(80.9)
|
|
(14.4)
|
Increase/(decrease) in trade and
other payables3
|
19.0
|
|
75.3
|
|
(0.3)
|
Cash generated from operations
|
53.1
|
|
55.8
|
|
109.1
|
|
|
|
|
|
|
1Comprises the reversal of items included in 'Other gains' in
the income statement that relate either to unrealised gains or
losses, or to cash flows relating to the disposal of financial
assets other than derivative contracts. Cash flows relating to
disposals are included in the Cash flow statement within 'Proceeds
from disposals of financial assets at FVTPL'.
2Comprises the reversal of net losses on instruments held to
provide an economic hedge for funds awards that are recognised
within Administrative expenses (Note 3). Cash flows arising from
the disposals of such instruments are included in the Cash flow
statement, in line with footnote 1 above.
3Amounts reported in these lines can differ from the movement
in the balance sheet where cash flows that form part of that
movement are separately reported in a different line of the Cash
flow statement or its notes. In 2023 and 2024, these differences
are principally in respect of cash flow movements relating to
consolidated funds. For trade and other payables, additionally,
cash flows arising from movements in lease liabilities are
presented on the face of the Cash flow statement.
18. Changes in
liabilities arising from financing activities
|
|
|
|
Financial liabilities at FVTPL
|
Loans
and borrowings1
|
Leases
|
Total
|
|
|
£m
|
£m
|
£m
|
£m
|
|
|
|
|
|
|
|
Brought forward at 1 January 2023
|
48.6
|
49.5
|
46.3
|
144.4
|
|
New leases
|
-
|
-
|
0.3
|
0.3
|
|
Changes from financing cash
flows
|
(0.1)2
|
-
|
(3.0)
|
(3.1)
|
|
Changes arising from obtaining or
losing control of consolidated funds
|
(0.4)
|
-
|
-
|
(0.4)
|
|
Changes in fair value
|
0.4
|
-
|
-
|
0.4
|
|
Interest expense
|
-
|
0.1
|
0.7
|
0.8
|
|
Lease reassignment and
modifications
|
-
|
-
|
0.6
|
0.6
|
|
Liabilities arising from financing activities carried forward
at 30 June 2023
|
48.5
|
49.6
|
44.9
|
143.0
|
|
|
|
|
|
|
|
New leases
|
-
|
-
|
0.3
|
0.3
|
|
Changes from financing cash
flows
|
29.02
|
-
|
(1.9)
|
27.1
|
|
Changes arising from obtaining or
losing control of consolidated funds
|
(0.8)
|
-
|
-
|
(0.8)
|
|
Changes in fair value
|
3.5
|
-
|
-
|
3.5
|
|
Interest expense
|
-
|
0.1
|
0.8
|
0.9
|
|
Liabilities arising from financing activities carried forward
at 31 December 2023
|
80.2
|
49.7
|
44.1
|
174.0
|
|
|
|
|
|
|
|
Changes from financing cash
flows
|
101.62
|
-
|
(4.1)
|
97.5
|
|
Changes arising from obtaining or
losing control of consolidated funds
|
68.9
|
-
|
-
|
68.9
|
|
Changes in fair value
|
0.1
|
-
|
-
|
0.1
|
|
Interest expense
|
-
|
0.1
|
0.7
|
0.8
|
|
Liabilities arising from financing activities carried forward
at 30 June 2024
|
250.8
|
49.8
|
40.7
|
341.3
|
|
|
|
|
|
|
|
Notes
|
|
13
|
|
|
|
1 Accrued interest on loans and borrowings is recorded within
'Trade and other payables' and is therefore not included in this
analysis. The interest expense above comprises the charge arising
from unwinding the discount applied in calculating the amortised
cost of the subordinated debt.
2 Comprises cash flows from third-party subscriptions into
consolidated funds, net of redemptions (see Cash flow
statement).
19. Financial
instruments
Financial instruments held at fair
value are carried at a value which represents the price to exit the
instruments at the balance sheet date. The fair value of financial
instruments that are actively traded in organised financial markets
is determined by reference to quoted market bid prices at the close
of business on the balance sheet date. Where a quoted market price
is not available, the Group establishes the fair value using
valuation techniques such as recent arm's length market
transactions, reference to the current fair value of another
instrument that is substantially the same, discounted cash flow
analysis or other valuation models. For financial instruments not
held at fair value, their carrying amount is a reasonable
approximation of their fair value.
The Group used the following
hierarchy for determining and disclosing the fair value of
financial instruments:
Level 1: quoted prices (unadjusted)
in active markets for identical assets or liabilities.
Level 2: other techniques, for
which all inputs which have a significant effect on the recorded
fair value are observable, either directly or
indirectly.
Level 3: techniques which use
inputs which have a significant effect on the recorded fair value
that are not based on observable market data (unobservable
inputs).
As at 30 June 2024, the Group held
the following financial instruments measured at fair
value:
|
Level
1
|
|
Level
2
|
|
Level
3
|
|
Total
|
|
£m
|
|
£m
|
|
£m
|
|
£m
|
Financial assets - investments in
funds
|
257.0
|
|
197.0
|
|
-
-
|
|
454.0
|
Financial liabilities -
non-controlling interests in consolidated funds
|
(250.8)
|
|
-
|
|
-
|
|
(250.8)
|
Financial liabilities -
derivatives
|
-
|
|
(0.1)
|
|
-
|
|
(0.1)
|
|
6.2
|
|
196.9
|
|
-
|
|
203.1
|
As at 30 June 2023, the Group held
the following financial instruments measured at fair
value:
|
Level
1
|
|
Level
2
|
|
Level
3
|
|
Total
|
|
£m
|
|
£m
|
|
£m
|
|
£m
|
Financial assets - investments in
funds
|
122.0
|
|
44.6
|
|
-
|
|
166.6
|
Financial assets -
derivatives
|
-
|
|
0.2
|
|
-
|
|
0.2
|
Financial liabilities -
non-controlling interests in consolidated funds
|
(48.5)
|
|
-
|
|
-
|
|
(48.5)
|
|
73.5
|
|
44.8
|
|
-
|
|
118.3
|
As at 31 December 2023, the Group
held the following financial instruments measured at fair
value:
|
Level
1
|
|
Level
2
|
|
Level
3
|
|
Total
|
|
£m
|
|
£m
|
|
£m
|
|
£m
|
Financial assets - investments in
funds
|
141.7
|
|
77.7
|
|
-
|
|
219.4
|
Financial liabilities -
non-controlling interests in consolidated funds
|
(80.2)
|
|
-
|
|
-
|
|
(80.2)
|
Financial liabilities -
derivatives
|
-
|
|
(0.1)
|
|
-
|
|
(0.1)
|
|
61.5
|
|
77.6
|
|
-
|
|
139.1
|
20. Related party
transactions
All related party transactions
during the period are consistent with those disclosed in the Annual
Report and Accounts for the year ended 31 December 2023 and have
taken place on an arm's length basis.
No new related parties or related
party transactions that materially affect the financial position or
performance of the Group existed or occurred during the
period.
Statement of Directors'
responsibilities
|
|
Statements relating to the
preparation of the Financial Statements
We confirm that to the best of our
knowledge:
The condensed set of financial
statements has been prepared in accordance with UK-adopted
International Accounting Standard 34, 'Interim Financial Reporting' as
required by the Companies Act 2006 and gives a true and fair view
of the assets, liabilities, financial position and profits of the
Group for the period ended 30 June 2024.
The interim report includes a fair
review of the information required by:
a) DTR 4.2.7R
of the Guidance, being an indication of important events that have
occurred during the first six months of the current financial year
and their impact on the condensed set of financial statements; and
a description of the principal risks and uncertainties for the
remaining six months of the year; and
b) DTR 4.2.8R of the
Guidance, being related party transactions that have taken place in
the first six months of the current financial year and that have
materially affected the financial position or performance of the
Group during that period; and any changes in the related party
transactions described in the last Annual Report and Accounts that
could have a material effect on the financial position or
performance of the Group in the past six months of the current
financial year.
A list of the Directors of Jupiter
Fund Management plc can be found in the Annual Report and Accounts
for the year ended 31 December 2023. A current list of Directors is
maintained on the website at www.jupiteram.com.
On behalf of the Board
Wayne Mepham
Chief Financial & Operating
Officer
25 July 2024
Principal risks and
mitigations
|
|
The Group is exposed to various
risk types in pursuing its business objectives, which can be driven
by both internal and external factors. Understanding and
managing these risks is a regulatory requirement but also
imperative to the success of the business. Our principal risks, as
disclosed in the Group's 2023 Annual Report and Accounts, remain
unchanged and our risk profile has remained stable during the first
half of 2024.
Jupiter's regulatory engagement
remains a key area of focus and we continue to engage with our
Regulators in an open and transparent manner, appropriately
managing changes to our regulatory landscape and any resulting
regulatory divergence.
Technology and Information Security
risk remains a key area of focus due to the risk posed from a
successful cyber-attack and we continue to maintain a robust
control environment in this area of the business, reducing
vulnerabilities where possible.
Outsourcing is a key component of
our business strategy and Jupiter relies on third-party
relationships to deliver our business services. In addition,
understanding and managing our People risk is essential to the
success of our business to ensure we meet our evolving operational
and regulatory needs.
We believe that the Group remains
well positioned and equipped to respond to any further volatility
in the markets in a way that continues to mitigate risk and protect
our client interests. Looking forward to the second half of
2024 and beyond we continue to leverage the Group's Enterprise Risk
Management framework to identify any key emerging risks which may
further impact our overall risk profile to ensure we are well
positioned to understand and manage them in line with the Group's
risk appetite.
Alternative performance
measures
|
|
The use of alternative performance
measures (APMs)
The Group uses APMs for two
principal reasons:
§ We use
ratios to provide metrics for users of the accounts; and
§ We use
revenue, expense and profitability-based APMs to explain the
Group's underlying profitability.
Ratios
The Group calculates ratios to
provide comparable metrics for users of the accounts. These ratios
are derived from other APMs that measure underlying revenue and
expenditure data.
In this document, we have used the
following ratios:
|
APM
|
Six
months ended
30 June
2024
|
Six
months ended
30 June
2023
|
Year
ended
31
December 2023
|
Definition
|
Reconciliation
|
1
|
Cost: income ratio
|
74%
|
71%
|
73%
|
Administrative expenses before
exceptional items and performance fee costs divided by net revenue
before performance fees
|
See table 1 below
|
2
|
Net management fee
margin
|
65bps
|
71bps
|
70bps
|
Net management fees divided by
average AUM
|
3
|
Total compensation ratio
|
46%
|
43%
|
43%
|
Compensation costs before
exceptional items as a proportion of net revenue
|
4
|
Total compensation ratio
before performance fees
|
45%
|
41%
|
42%
|
Compensation costs before
exceptional items and performance fee costs as a proportion of net
revenue before performance fees
|
5
|
Underlying EPS
|
6.6p
|
6.7p
|
14.8p
|
Underlying profit after tax
attributable to equity holders of the parent divided by average
issued share capital
|
6
|
Underlying EPS before performance
fee profits/losses
|
6.4p
|
7.1p
|
13.8p
|
Underlying profit after tax before
performance fee profits/losses attributable to equity holders of
the parent divided by average issued share capital
|
Reconciliation of reported IFRS
numbers to APMs: table 1
|
APM
|
Six
months ended
30 June
2024
£m
|
Six
months ended
30 June
2023
£m
|
Year
ended
31
December 2023
£m
|
|
|
|
|
|
|
|
Administrative expenses (page
7)
|
|
129.1
|
134.4
|
265.4
|
|
Less: Performance fee costs (page
5)
|
|
(2.6)
|
(3.5)
|
(6.4)
|
|
Less: Exceptional items included
in administrative expenses (page 5)
|
|
-
|
(2.2)
|
(0.8)
|
|
Administrative expenses before exceptional
items and performance fee costs
|
|
126.5
|
128.7
|
258.2
|
|
|
|
|
|
|
|
Net revenue (page 7)
|
|
173.7
|
181.0
|
368.8
|
|
Less: Performance fees (page
12)
|
|
(3.9)
|
(0.4)
|
(13.2)
|
|
Net revenue before performance fees
|
|
169.8
|
180.6
|
355.6
|
|
Cost: income
ratio
|
1
|
74%
|
71%
|
73%
|
|
|
|
|
|
|
|
Management fees (page
12)
|
|
187.5
|
198.5
|
389.9
|
|
Less: Fees and commissions
relating to management fees (page 12)
|
|
(18.5)
|
(18.7)
|
(35.9)
|
|
Net management fees
|
|
169.0
|
179.8
|
354.0
|
|
Average AUM (£bn) (page 4)
|
|
52.1
|
50.9
|
50.9
|
|
Net management fee
margin
|
2
|
65bps
|
71bps
|
70bps
|
|
|
|
|
|
|
|
Compensation costs before exceptional items (page
5)
|
|
79.8
|
78.4
|
157.3
|
|
Net revenue (see above)
|
|
173.7
|
181.0
|
368.8
|
|
Total compensation
ratio
|
3
|
46%
|
43%
|
43%
|
|
|
|
|
|
|
|
Compensation costs before exceptional items and performance
fee costs (page 5)
|
|
77.2
|
74.9
|
150.9
|
|
Net revenue before performance fees (see
above)
|
|
169.8
|
180.6
|
355.6
|
|
Total compensation ratio
before performance fees
|
4
|
45%
|
41%
|
42%
|
|
|
|
|
|
|
|
Statutory profit before tax (page
7)
|
|
38.7
|
34.8
|
9.4
|
|
Exceptional items (page
5)
|
|
9.2
|
11.6
|
95.8
|
|
Underlying profit before tax
|
|
47.9
|
46.4
|
105.2
|
|
Tax at average statutory rate of
25.0% (2023 H1: 22.0% and 2023 FY: 23.5%)1
|
|
(12.0)
|
(10.2)
|
(24.7)
|
|
Underlying profit after tax
|
|
35.9
|
36.2
|
80.5
|
|
Loss attributable to
non-controlling interests (page 9)
|
|
-
|
0.1
|
-
|
Underlying profit after tax attributable to equity
shareholders of the parent
|
|
35.9
|
36.3
|
80.5
|
|
Average issued share capital (m) (page 15)
|
|
545.0
|
545.1
|
545.0
|
|
Underlying
EPS
|
5
|
6.6p
|
6.7p
|
14.8p
|
|
1Actual effective tax rates applicable to underlying profit
before tax were 26.7% in 2024 H1, 29.9% in 2023 H1 and 25.6% in
2023 FY.
|
|
|
|
|
|
|
|
Underlying profit before tax (see
above)
|
|
47.9
|
46.4
|
105.2
|
|
Less: Performance fee
(profits)/losses (page 5)
|
|
(1.3)
|
3.1
|
(6.8)
|
|
Tax at average statutory rate of
25.0% (2023 H1: 22.0% and 2023 FY: 23.5%)2
|
|
(11.7)
|
(10.9)
|
(23.1)
|
|
Underlying profit after tax before performance
fees
|
|
34.9
|
38.6
|
75.3
|
|
Loss attributable to
non-controlling interests (see above)
|
|
-
|
0.1
|
-
|
|
Underlying profit after tax attributable to equity
shareholders of the parent before performance
fees
|
|
34.9
|
38.7
|
75.3
|
|
Average issued share capital (m) (see
above)
|
|
545.0
|
545.1
|
545.0
|
|
Underlying EPS before
performance fee (profits)/losses
|
6
|
6.4p
|
7.1p
|
13.8p
|
|
2Actual effective tax rates applicable to underlying profit
before tax were 26.6% in 2024 H1, 29.5% in 2023 H1 and 25.7% in
2023 FY.
|
|
|
|
|
|
|
|
Revenue, expense and profit-related
measures
1)
Asset managers commonly draw out subtotals of
revenues less cost of sales, taking into account items such as fee
expenses, including commissions payable, without which a proportion
of the revenues would not have been earned. Such net subtotals can
also be presented after deducting non-recurring exceptional
items.
2)
The Group uses expense-based APMs to identify and
separate out non-recurring exceptional items or recurring items
that are of significant size in order to provide useful information
for users of the accounts who wish to determine the underlying cost
base of the Group. To further assist in this, we also provide
breakdowns of administrative expenses below the level required to
be disclosed in the statutory accounts, for example, distinguishing
between compensation and non-compensation expenditure. These
subdivisions of expenditure are also presented before and after
exceptional items and after accounting for the impact of
performance fee pay-aways to fund managers.
3)
Profitability-based APMs are effectively the sum
of the above revenue and expense-based APMs and are provided for
the same purpose - to separate out non-recurring exceptional items
or recurring items that are of significant size in order to provide
useful information for users of the accounts who wish to determine
the underlying profitability of the Group.
4)
Underlying profit after tax is, in addition, used
to calculate underlying EPS which determines the Group's ordinary
dividend per share and is used in one of the criteria for measuring
the vesting rates of share-based awards that have performance
conditions attached.
In this document, we have used the
following measures which are reconciled or cross-referenced in
table 1:
Measure
|
Rationale for use of
measure
|
Net management fees
|
1
|
Exceptional
items1
|
2
|
Net revenue
|
1
|
Performance fees
|
2
|
Compensation costs before
exceptional items
|
2
|
Underlying profit before
tax2
|
3
|
Underlying profit after
tax2
|
3,
4
|
1
Defined as items of income or
expenditure that are significant in size and which are not expected
to repeat over the short to medium term.
As stated in 2 above, the Group
presents a breakdown of administrative expenses below the level
required to be disclosed in the statutory accounts, distinguishing
between compensation and non-compensation expenditure. The relevant
amounts are set out in the table on page 5.
The impact of exceptional items on
the financial statements
The Group has presented certain
items as exceptional across all periods. Exceptional items are
defined above. These items principally relate to the Merian Global
Investors Limited (Merian) acquisition in 2020. Further details of
all items that are deemed exceptional are explained below, as well
as within the relevant notes to the accounts and in the Management
Statement.
The use of exceptional items and
underlying profit measures
In the Management Statement of this
document, the Group makes use of a number of APMs, including
'Underlying profit before tax'. The use of such measures means that
financial results referred to in that section of this document may
not be equal to the statutory results reported in the financial
statements. Guidelines issued by the Financial Reporting Council
require such differences to be reconciled.
'Underlying profit before tax' is
equal to the statutory profit before tax after exceptional items.
The financial statements do not refer to or use such measures, but
the table below provides a reconciliation, indicating in which
notes the exceptional items are recorded.
|
Notes
|
Six
months ended
30 June 2024
£m
|
|
Six
months ended
30 June 2023
£m
|
|
Year
ended
31
December 2023
£m
|
Underlying profit before tax (page 1)
|
|
47.9
|
|
46.4
|
|
105.2
|
Administrative expenses
|
3
|
-
|
|
(2.2)
|
|
(0.8)
|
Impairment of goodwill
|
8
|
-
|
|
-
|
|
(76.2)
|
Amortisation of intangible
assets
|
9
|
(9.2)
|
|
(9.4)
|
|
(18.8)
|
Statutory profit before tax
|
|
38.7
|
|
34.8
|
|
9.4
|
Changes in the use of
APMs
In previous periods, the Group had
disclosed fixed staff costs and variable staff costs as separate
line items within the management statement. Within this document,
we have presented these two amounts as a single line item on page 5
as 'Compensation costs' and consequently on page 26, where it is
used before and after performance fee costs as part of the Group's
reconciliation of APMs. This change has been made in order to
simplify the presentation.
Independent Review Report to
Jupiter Fund Management plc
|
|
Report on the condensed
consolidated interim financial statements
Conclusion
We have been engaged by Jupiter Fund
Management plc (the 'Company') to review the condensed consolidated
financial statements in the Interim Report and Accounts for the six
months ended 30 June 2024 which comprise the Consolidated income
statement, Consolidated statement of comprehensive income,
Consolidated balance sheet, Consolidated statement of changes in
equity, Consolidated statement of cash flows and explanatory notes
1 to 20. We have read the other information contained in the
Interim Report and Accounts and considered whether it contains any
apparent misstatements or material inconsistencies with the
information in the condensed consolidated set of financial
statements.
Based on our review, nothing has
come to our attention that causes us to believe that the condensed
consolidated set of financial statements in the Interim Report and
Accounts for the six months ended 30 June 2024 is not prepared, in
all material respects, in accordance with UK-adopted International
Accounting Standard 34, "Interim Financial Reporting", and the
Disclosure Guidance and Transparency Rules of the United Kingdom's
Financial Conduct Authority.
Basis for conclusion
We conducted our review in
accordance with International Standard on Review Engagements 2410
(UK) "Review of Interim Financial Information Performed by the
Independent Auditor of the Entity" issued by the Financial
Reporting Council. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK) and consequently does not enable us to obtain
assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not
express an audit opinion.
As disclosed in the Statement of
Directors' responsibilities for the Interim Report and Accounts,
the annual financial statements of the Company are prepared in
accordance with UK-adopted international accounting standards. The
condensed consolidated set of financial statements included in the
Interim Report and Accounts has been prepared in accordance with
UK-adopted International Accounting Standard 34, "Interim Financial
Reporting".
Conclusions relating to going
concern
Based on our review procedures,
which are less extensive than those performed in an audit as
described in the Basis for Conclusion section of this report,
nothing has come to our attention to suggest that management have
inappropriately adopted the going concern basis of accounting or
that management have identified material uncertainties relating to
going concern that are not appropriately disclosed.
This conclusion is based on the
review procedures performed in accordance with this ISRE, however
future events or conditions may cause the entity to cease to
continue as a going concern.
Responsibilities of the
directors
The directors are responsible for
preparing the Interim Report and Accounts in accordance with the
Disclosure Guidance and Transparency Rules of the United Kingdom's
Financial Conduct Authority.
In preparing the Interim Report and
Accounts, the directors are responsible for assessing the Company's
ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the
company or to cease operations, or have no realistic alternative
but to do so.
Auditor's responsibilities for the
review of financial information
In reviewing the half-yearly report,
we are responsible for expressing to the Company a conclusion on
the condensed consolidated set of financial statements in the
half-yearly financial report. Our conclusion, including our
Conclusions Relating to Going Concern, are based on procedures that
are less extensive than audit procedures, as described in the Basis
for Conclusion paragraph of this report.
Use of our report
This report is made solely to the
Company in accordance with guidance contained in International
Standard on Review Engagements 2410 (UK) "Review of Interim
Financial Information Performed by the Independent Auditor of the
Entity" issued by the Financial Reporting Council. To the fullest
extent permitted by law, we do not accept or assume responsibility
to anyone other than the Company, for our work, for this report, or
for the conclusions we have formed.
Ernst & Young LLP
London
25 July 2024