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Schroders2012 Q1 results
May 2012 | For professional investors only. This material is not suitable for retail clients
Data Pack
Contents
1Schroders 2012 Q1 Results | 3 May 2012
Page
Assets under management (AUM) 2Regional diversification of AUM 3Gross sales and net inflows 4-5Currency profile of AUM 6AUM diversification 7-11Asset Management business flows 12-14Net revenue and margins – Asset Management 15Income and cost metrics for the Group 16Key performance indicators 17-18Total costs and headcount 19-20Income statement progression 21-23Group segment – economic view 24Balance sheet 25Movement in capital 26Forward-looking statements 27
Assets under management (AUM) £199.6 billion at 31 March 2012
£bn
Asset Management
Private Banking TotalInstitutional Intermediary
31 December 2011 108.4 62.9 16.0 187.3
Net flows 1.4 0.3 (0.1) 1.6
Investment returns 6.4 3.8 0.5 10.7
31 March 2012 116.2 67.0 16.4 199.6
2Schroders 2012 Q1 Results | 3 May 2012
Regional diversification of AUM63% of revenues outside UK
3Schroders 2012 Q1 Results | 3 May 2012
NorthAmerica£21.7bn
South America£6.1bn
ContinentalEurope£40.0bn
UK£74.8bn Asia
Pacific £51.9bn
MiddleEast
£5.1bn
Schroders 2012 Q1 Results | 3 May 2012
17.215.9
14.2
12.0
13.9
0
5
10
15
20
Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
Gross sales
4
£bn
Equities Fixed Income Multi-Asset Alternatives Private Banking
5
Net inflows
3.1
2.0
0.0
-1.9
1.6
Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
£bn
Equities Fixed Income Multi-Asset Alternatives Private Banking
Schroders 2012 Q1 Results | 3 May 2012
Currency profile of AUMAssets under management £199.6 billion
32%
11%
24%
3%
1%
29%
GBP EUR USD JPY CHF Other
6Schroders 2012 Q1 Results | 3 May 2012
58%
34%
8%
InstitutionalIntermediaryPrivate Banking
By channel By region By product
Total AUM by channel, region and productAssets under management £199.6 billion
7Schroders 2012 Q1 Results | 3 May 2012
* Including Middle EastBy client domicile
37%
23%
26%
14%
UKContinental Europe*Asia PacificAmericas
45%
17%
11%
19%
8%
EquitiesFixed IncomeAlternativesMulti-AssetPrivate Banking
54%
25%
11%
10%
Equities Fixed Income
Institutional AUM £116.2bn Intermediary AUM £67.0bn
Asset Management AUM by channel and product
8Schroders 2012 Q1 Results | 3 May 2012
45%
16%
26%
13%
Multi-asset Alternatives
Institutional AUM £116.2bn Intermediary AUM £67.0bn
Asset Management AUM by channel and region
9Schroders 2012 Q1 Results | 3 May 2012
By client domicile
39%
18%
25%
18%
Asia Pacific Americas
28%
29%
32%
11%
UK Continental Europe
27%
21%
35%
17%
UK Continental Europe
Equities AUM £88.5bn Fixed income AUM £34.6bn
Asset Management AUM analysis
10Schroders 2012 Q1 Results | 3 May 2012
By client domicile
25%
33%
31%
11%
Asia Pacific Americas
41%
26%
16%
12%
5%
PropertyCommoditiesEmerging market debtFunds of hedge fundsPrivate equity funds of funds
Alternatives AUM £22.7bn Multi-Asset AUM £37.4bn
Asset Management AUM analysis
11Schroders 2012 Q1 Results | 3 May 2012
40%
23%
37%
UK multi-assetLiability-driven investmentOther multi-asset
Asset Management business flows
12Schroders 2012 Q1 Results | 3 May 2012
£bn
Q1 2011 Q1 2012
Inflows Outflows Net Inflows Outflows Net
Institutional 6.6 (3.8) 2.8 5.1 (3.7) 1.4
Intermediary 9.3 (9.1) 0.2 7.8 (7.5) 0.3
Total Asset Management 15.9 (12.9) 3.0 12.9 (11.2) 1.7
Assets under management: £116.2bn (31 Dec 2011: £108.4bn)Institutional
13
6.6 6.5 6.2
4.6 5.1
-3.8-4.7
-3.4
-5.2
-3.7
2.81.8
2.8
-0.6
1.4
-10
0
10
Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
Gross inflows Gross outflows Net flows
£bn
Schroders 2012 Q1 Results | 3 May 2012
IntermediaryAssets under management: £67.0bn (31 Dec 2011: £62.9bn)
14
9.38.4
7.1 6.37.8
-9.1-8.2
-9.8-7.8 -7.5
0.2 0.2
-2.7-1.5
0.3
-15
-5
5
15
2009 2010 2011
Gross inflows Gross outflows Net flows
£bn
Schroders 2012 Q1 Results | 3 May 2012
Asset Management net revenue £250.8 million (Q1 2011: £261.2 million)
Net revenue and margins – Asset Management
Q1 2011 Q1 2012
Average AM AUM – £bn 182.7 177.2
AM net revenue on average AM AUM 58bps 57bps
AM performance fees – £m 7.8 6.0
AM performance fees on average AM AUM 2bps 1bps
AM costs – £m 165.3 164.2
AM costs on average AM AUM 36bps 37bps
AM operating profit – £m 95.9 86.6
AM operating profit on average AM AUM 21bps 20bps
15Schroders 2012 Q1 Results | 3 May 2012
2011 2012
Compensation cost: operating revenue ratio 46% 47%
Bonus: pre-bonus operating profit 40% 38%
Cost: net revenue ratio 66% 68%
Return on average capital (pre-tax) 23% 20%
Return on average capital (post-tax) 17% 15%
Compensation cost: operating revenue = total Group compensation costs divided by Asset Management and Private Banking net revenues*
Bonus: pre-bonus operating profit = total Group bonus divided by pre-bonus Asset Management and Private Banking profit before tax
Cost: net revenue = total Group costs divided by net revenue
Return on average capital (pre-tax) = total Group profit before tax divided by average capital
Return on average capital (post-tax) = total Group profit after tax divided by average capital
Income and cost metrics for the Group
16Schroders 2012 Q1 Results | 3 May 2012
* Adjusted by the Remuneration Committee for allowable and disallowable revenues
49%
45% 44%47%
2009 2010 2011 Q1 2012
Key performance indicatorsCompensation cost: operating revenue ratio
17Schroders 2012 Q1 Results | 3 May 2012
Total Group compensation costs divided by Asset Management and Private Banking net revenues adjusted by the Remuneration Committee for allowable and disallowable revenues.2009 figures exclude exceptional items
78%
67% 66% 68%
2009 2010 2011 Q1 2012
Key performance indicatorsCost: net revenue ratio
18Schroders 2012 Q1 Results | 3 May 2012
Total Group costs divided by net revenue2009 figures exclude exceptional items
Total costs
19Schroders 2012 Q1 Results | 3 May 2012
134.4 123.4 130.4111.5
133.4
59.1 71.5 62.269.3
59.5
193.5 194.9 192.6180.8
192.9
0
50
100
150
200
250
Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
Staff costs Non-staff costs
£m
Headcount
20Schroders 2012 Q1 Results | 3 May 2012
2,7932,844
2,901 2,902 2,926
Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
Income statement progressionAsset Management profit before tax
£m Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
Institutional 108.5 117.2 109.4 118.4 120.0
Intermediary 152.7 156.2 147.4 131.7 130.8
Net revenue 261.2 273.4 256.8 250.1 250.8
Costs (165.3) (169.9) (166.6) (156.7) (164.2)
JVs and associates 1.6 2.6 2.5 – 2.0
Net finance (charge)/income (0.2) (0.3) – 0.2 –
Asset Management profit 97.3 105.8 92.7 93.6 88.6
21Schroders 2012 Q1 Results | 3 May 2012
Income statement progressionPrivate Banking profit before tax
£m Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
Net revenue 30.1 27.9 29.3 27.0 27.1
Costs (23.4) (22.3) (22.6) (22.2) (20.7)
Private Banking profit 6.7 5.6 6.7 4.8 6.4
22Schroders 2012 Q1 Results | 3 May 2012
Income statement progressionGroup segment (loss)/profit before tax
£m Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012
Net revenue (0.7) 1.3 4.3 (8.1) 4.8
Costs (3.4) (4.1) (3.4) (1.9) (8.0)
JVs and associates* (0.6) (1.2) (1.8) (1.1) (0.1)
Net finance income 4.5 4.5 3.1 2.7 3.8
Group (loss)/profit (0.2) 0.5 2.2 (8.4) 0.5
23
*Schroder Ventures Investments Limited only
Schroders 2012 Q1 Results | 3 May 2012
Group segmentEconomic view
£m Q1 2011 Q1 2012
Deferred remuneration mark to market and FX 1.0 0.4
Pension fund credits - 0.3
Property and other provisions 5.1 (0.1)
Variable items 6.1 0.6
Costs (8.5) (8.3)
Total Governance, management and other (2.4) (7.7)
Investment capital 2.2 8.2
Total Group segment (0.2) 0.5
24
Balance sheet
£m 31 Dec 2011 31 Mar 2012
Intangible assets including goodwill 144.1 142.4
Other non-current assets 774.2 757.9
Current assets 4,321.3 4,630.8
Assets backing unit-linked liabilities 8,645.2 9,218.3
Total assets 13,884.8 14,749.4
Non-current liabilities 510.3 469.1
Current liabilities 2,827.7 3,101.0
Unit-linked liabilities 8,645.2 9,218.3
Total liabilities 11,983.2 12,788.4
Net assets 1,901.6 1,961.0
Total equity* 1,901.6 1,961.0
25
*Includes non-controlling interests Mar 2012: £0.2m (Dec 2011: £0.2m)
Schroders 2012 Q1 Results | 3 May 2012
Movement in capital
£m 2011
Opening balance 1,901.6
Profit before tax 95.5
Net fair value movement arising from AFS financial assets 6.1
Exchange differences on translation of foreign operations after hedging (7.4)
Tax (12.2)
Other transactions with owners (22.6)
Closing balance 1,961.0
Schroders 2012 Q1 Results | 3 May 2012 26
These presentation slides may contain forward-looking statements with respect to the financial condition, results of operations and businesses of the Schroders Group.
These statements and forecasts involve risk and uncertainty because they are based on current expectations and assumptions but they relate to events and depend upon circumstances in the future. Without limitation, any statements preceded or followed by or that include the words ‘targets’, ‘plans’, ‘believes’, ‘expects’, ‘aims’ or ‘anticipates’ or the negative of these terms and other similar terms are intended to identify such forward-looking statements.
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 presentation. The Directors do not make any undertaking to update or revise anyforward-looking statements, whether as a result of new information, future events or otherwise. Nothing in this presentation should be construed as a profit forecast.
Forward-looking statements
27Schroders 2012 Q1 Results | 3 May 2012