Star fund manager Smith scoops £190m
STAR stockpicker Terry Smith is estimated to have pocketed £190m as his investment firm continued to rake in profits last year.
The 69-year-old’s company Fundsmith generated a profit of £58.2m for the year to the end of March 2022, a slight increase on the £ 57.7m delivered a year earlier, according to accounts filed with Companies House.
Under the firm’s partnership structure, its highest- paid member, believed to be Smith, was awarded a £36.5m share of the profits, up from the £35.7m paid out in 2021.
The company also revealed it was charged nearly £252m in fees during the year by Smith’s Mauritius-based business Fundsmith Investment Services (FIS), up from £188m the previous year.
The fund manager is thought to own 61pc of FIS, meaning he could have raked in almost £154m of these fees, taking his total haul for the year to just over £190m.
Smith is a veteran investor and is also one of the most popular, with his flagship Fundsmith Equity fund looking after around £ 23bn of savers’ money. But despite the steady profits, the group’s current financial year is likely to make for much less favourable reading.
Many of Fundsmith Equity’s biggest holdings include tech firms such as Microsoft, Amazon, Google parent Alphabet and Facebook owner Meta, all of which suffered a drubbing in 2022 as a boom in the sector was brought to a shuddering halt by rising interest rates and surging inflation. Other major investments in the portfolio include consumer goods giants such as L’Oréal and Estee Lauder as well as tobacco giant Philip Morris.
The tech bloodbath hit the fund’s performance hard, with Fundsmith Equity’s share price falling nearly 14pc last year.
Smith also shocked the investment world in September when he announced he would close down his £ 325m Fundsmith Emerging Equities Trust as its performance was not living up to expectations.
The move stunned the City, with one analyst saying Smith had effectively ‘fired’ himself from a fund that had still been earning him healthy fees.
But despite the sharp downturn, Smith still appears to have retained an appetite for tech giants, with Fundsmith Equity snapping up a stake in Apple in November following a slump in its share price.
The investment was followed by a decision to dump payments firm PayPal and software group Intuit after sharp declines. Tech stocks currently account for nearly 32pc of the fund’s portfolio.