Profits drop at Standard Life Aberdeen

Standard Life Aberdeen has warned over a “turbulent” 2020 as it posted a 10% drop in annual profits after customers continued to pull out cash.

It reported underlying pre-tax profits of £584 million, down from £650m in 2018, as feebased revenues fell 13% after two years of fund outflows.

Standard Life Aberdeen (Sla), Britain’s biggest listed asset manager, suffered net outflows of £58.4 billion, including £41bn lost due to Lloyds Banking Group’s decision to end its mammoth contract with the group.

Even with this stripped out, Sla still saw £17.4bn of investor cash walk out the door.

The group said the outflows “continued reflecting investor sentiment towards emerging markets and equity markets more generally”.

On a statutory basis, Sla swung to a £243m pre-tax profit from losses of £787m in 2018.

The group said the outlook was set to be volatile, given the coronavirus outbreak and equity market turmoil.

Keith Skeoch, chief executive of Sla, said: “The outlook for the markets and our industry in 2020 is turbulent with the additional complexity of Covid-19.

“Importantly we are focused on what we can control, namely delivering for our clients, customers, colleagues and shareholders; diversifying our revenues; investing for the future and maintaining financial discipline.”

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said while the results show an improving performance at Sla, the recent market chaos threatens to throw its turnaround off course.