Edinburgh funds giant Abrdn hails 2021 as 'reset' year but Ukraine casts a shadow

Abrdn, the Scottish investment giant, has hailed 2021 as its “reset” year after reporting an increase in annual revenues for the first time since its merger with Standard Life in 2017.

The group, formerly known as Standard Life Aberdeen, pointed to strong progress during the first year of its three-year growth plan.

Chief executive Stephen Bird said the business had made “huge strides forward” with its new strategy.

“We have simplified and extended the relationship with our largest client, Phoenix,” he added. “We have successfully rebranded as abrdn which gives us a unified global identity and purpose. We have divested non-core assets and built out our capabilities across our three vectors, including in private markets and digital content.”

Abrdn is the new name of the Scottish investment giant formerly known as Standard Life Aberdeen.

Adjusted operating profits jumped to £323 million last year, up 47 per cent from the £219m booked in 2020, as revenue rose 6 per cent to just over £1.5 billion. Total assets under management and administration nudged up 1 per cent to £542bn.

Shareholders will see no change in payouts this year as a full-year dividend of 14.6p per share was declared.

Bird said: “For the first time since the merger, we have reported an increase in revenue for the full year - as well as an improved cost/income ratio of 79 per cent, and a 47 per cent increase in adjusted operating profit. We remain focused on delivering compound annual revenue growth in the high single figures.”

He added: “Clearly, markets are volatile right now. Geopolitical risk and inflation are rising and there remains an element of uncertainty about the pace at which different economies are recovering from the impacts of the Covid-19 pandemic.

“We benefit from a strong capital position enabling us both to continue to invest in the business and return money to shareholders. This balance underpins our ability to create long-term value for shareholders.”

The latest figures mark the first full-year results since the group rebranded as Abrdn from Standard Life Aberdeen.

John Moore, senior investment manager at wealth manager Brewin Dolphin, said: “It has been a challenging few years for shareholders in Abrdn, but there are some indications in today’s results that the company is headed in a more positive direction.

“Assets under management and revenues are beginning to stabilise and Abrdn’s costs are improving - in addition, its investment in Tritax is beginning to bear fruit and the acquisition of Interactive Investor can help diversify the business.

“The situation in Ukraine will obviously affect Abrdn but there are tentative signs the management team’s strategy is beginning to yield results which, in turn, should help improve investor sentiment,” he noted.

In December, Abrdn agreed a £1.5bn deal to buy Interactive Investor, just weeks after news of talks emerged.

Online investment platform Interactive Investor has more than 400,000 customers and assets under administration of about £55bn.

Abrdn said the acquisition would “significantly enhance” its presence and growth opportunities within a “fast-growing and attractive market”. As part of the deal, Richard Wilson, chief executive of Interactive Investor, joined Edinburgh-headquartered Abrdn.

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