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28/02/2014

Old Mutual Wealth, comprising Skandia and Old Mutual Global Investors, saw IFRS Adjusted Operating Profit increase by 11% to £217 million (2012: £195 million) as it continues to benefit from the growing demand for platform based portfolio management solutions post RDR. Its assets grew by 13% during the period to £78.5 billion as at 31 December 2013 (2012: £69.2 billion).

Underlying profits before tax have grown 36%, from £160 million to £217 million.  The reported 2012 profit of £195 million included £13 million from Finland which was sold in H2 2012 and exceptional policyholder tax contributions of £22 million, in part due the move to a new life tax regime.

Old Mutual Global Investors’ (OMGI) IFRS Adjusted Operating Profit improved to £15 million from £2 million in 2012, with gross sales up 68% at £7.6 billion (2012: £4.5 billion). Improved sales were seen across the Alternatives and Equities desks, with the latter benefiting from high profile hires during the year, improved market conditions, added consumer confidence and a shift from fixed income back into equities.   

OMGI reported net client cash flow for 2013 of £0.7 billion, which includes an outflow of £1.0 billion as a result of the Group’s disposal of the Skandia Nordic business. Net new business sales through the UK Platform into OMGI funds were 16% for the full year, up from 14% in 2012. This is a result of OMGI’s improved offering and continued strong investment performance – 44% of funds are in the first quartile over a three year period and a total of 66% of funds are above the median. OMGI’s funds under management have increased by 16% to £16.0 billion (December 2012: £13.8 billion).

The UK platform recorded an IFRS Adjusted Operating Profit of £13 million for the full year (2012: £2 million), with assets jumping 21% on the prior year to £27.3 billion. Growth was driven by demand for packaged investment solutions from financial advisers who are increasingly seeking to outsource their investment processes post-RDR. Platform gross sales increased by 14% to £4.7 billion (2012: £4.1 billion), generating positive net client cash flow (NCCF) of £2.4 billion (2012: £2.2 billion).  

International cross border gross sales of £1.92 billion were up 14% on the prior period (2012: £1.68 billion) and NCCF almost doubled to £492 million (2012: £265 million).  This growth was driven by strong sales of QROPS in Europe and improved portfolio bond sales globally. Meanwhile the Latin American operation has developed well following the acquisition of AIVA helping leverage the cross-border distribution reach in that market. 

The Skandia operations in Europe that are open to new business also returned strong results in 2013 following improved sales in Italy and the significantly reduced expense base in France. Initiatives focused on strengthening and diversifying the distribution channels across the open markets have started to pay off with France recording an operating profit for the business for the first time, while Italy exceeded its target return on equity for the local business of 12%. 

Paul Feeney, chief executive of Old Mutual Wealth, comments:Paul Feeney

“People require high quality financial advice and portfolio management to help them achieve their financial goals. With developments like WealthSelect, our newly launched range of portfolio management solutions, we are going beyond being simply a transactional platform to providing the solutions that can help financial advisers manage their clients’ wealth. 

“We are well on the road to creating a market leading asset management business in Old Mutual Global Investors. The hires we have made this year are a signal of our ambition for a business that will be a key driver of our future growth alongside our investment platforms.

“Today we have reinforced our commitment to financial advice through the acquisition of Intrinsic which is an important step in creating the UK’s leading retail investment business, improving access to wealth management services for customers across the UK.”

For more information contact

Tim Skelton-SmithOld Mutual Wealth02380 916 99807824 145 076

Notes to Editors:

Old Mutual Wealth is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Old Mutual Wealth oversees £131.3 billion in customer investments (as at 30 September 2017).

It has an adviser and customer offering spanning: Financial advice; investment platforms; multi-asset and single strategy investment solutions; and discretionary fund management.

The business is comprised of two segments: Wealth Platforms and Advice and Wealth Management.

Wealth Platforms includes the Old Mutual Wealth UK Platform; Old Mutual International, including AAM Advisory in Singapore; and the Old Mutual Wealth Heritage life assurance business.

Advice and Wealth Management encompasses the financial planning network, Intrinsic; Old Mutual Wealth Private Client Advisers; discretionary fund management business, Quilter Cheviot; and Old Mutual Wealth’s multi-asset investment solutions business.

Old Mutual Global Investors (‘OMGI’) is the asset management business of Old Mutual Wealth with £39.8bn funds under management (as at 30 September 2017). On the 19th December 2017, Old Mutual Wealth announced that it has agreed to sell its Single Strategy asset management business to the Single Strategy Management team and funds managed by TA Associates. The proposed transaction is subject to customary closing conditions, including regulatory approvals. 

Following managed separation from Old Mutual plc, Old Mutual Wealth will rebrand to Quilter plc. Each of the businesses within the Quilter Plc group will be rebranded over a two-year period, with the exception of Quilter Cheviot, which will retain its existing name.

Old Mutual Wealth is part of Old Mutual plc, a FTSE 100 group that provides life assurance, asset management, banking and general insurance. Old Mutual is trusted by more than 19.4 million (as at 31 December 2016) customers across the world and has a total of £212.3 billion of assets under management (as at 30 June 2017).

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These materials are not an offer to sell, or a solicitation of an offer to purchase, securities in the United States. The securities to which these materials relate have not been registered under the US Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act. There will be no public offering of the securities in the United States.

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Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

This communication is issued by Old Mutual Wealth Management Limited, a Private Limited Company (Company Number 0604270), Old Mutual House Portland Terrace Southampton Hampshire SO14 7EJ.