Integrated Annual Report 2015

Asset Management

At Investec Asset Management, we want to assist people around the globe to retire with dignity. We do this by assisting institutional asset owners and financial advisors to meet the investment objectives of their members and clients. Our business is to manage clients’ investments to the highest standard possible by exceeding their investment and client service expectations

Investec Asset Management is a global provider of active investment management services. Established in 1991 in South Africa, we have built a successful global investment management firm from emerging markets. We are still managed by our founding members whose tenure and continuity has balanced stability and growth.

Our investment team of approximately 175 investment professionals applies clear investment philosophies and processes across multiple asset classes. Our client group is organised across five geographically defined units serving our target clients around the globe. These teams are supported by our global investment and operational infrastructure.

Global head of Asset Management: Hendrik du Toit (chief executive officer)

Our value proposition

Annual highlights

Annual highlights

Global executive committee

Chief executive officer
Hendrik du Toit

Chief operating officer
Kim McFarland

Global head of client group
John Green

Co-chief investment officer
Domenico (Mimi) Ferrini

Co-chief investment officer
John McNab

Capabilities and organisational structure

 

 

 

 

 

 

 


What we do

Capabilities and organisational structure

Where we operate

Where we operate

Financial analysis

Financial analysis
* Before goodwill, acquired intangibles, non-operating items, taxation and after other non-controlling interests.
** As calculated here, based on regulatory capital requirements.

Historical financial performance

Historical financial performance

Income statement analysis

£’000 31 March 
2015 
31 March 
2014 
Variance  % change 
Net interest income 4 307  3 918  389  9.9% 
Net fee and commission income 428 555  409 341  19 214  4.7% 
Investment income 22  28  (6) (21.4%)
Trading income arising from balance sheet management and other trading activities 1 485  (1 982) 3 467 > 100.0% 
Other operating income 1 690  2 875  (1 185) (41.2%)
Total operating income 436 059  414 180  21 879  5.3% 
Operating costs (287 084) (270 361) (16 723) 6.2% 
Operating profit before goodwill, acquired intangibles, non-operating items, taxation and before non-controlling interests 148 975  143 819  5 156  3.6% 
Profit attributable to Asset Management non-controlling interests** (18 184) (11 031) (7 153) (64.8%)
Operating profit before goodwill, acquired intangibles, non-operating items, taxation and after non-controlling interests 130 791  132 788  (1 997) (1.5%)
         
UK and Other 65 438  62 050  3 388  5.5% 
Southern Africa 65 353  70 738  (5 385) (7.6%)
Operating profit before goodwill, acquired intangibles, non-operating items, taxation and after non-controlling interests 130 791  132 788  (1 997) (1.5%)
         
Selected returns and key statistics        
Ordinary shareholders’ equity* 160 648  147 123  13 525  9.2% 
ROE (pre-tax)* 95.2%  104.1%     
Return on tangible equity (pre-tax)* 236.3%  328.5%     
Operating margin 34.2%  34.7%     
Operating profit per employee (£’000)*^ 169.5  176.5  (7.0) (4.0%)
* As calculated here, based on regulatory capital requirements.
** Earnings after tax attributable to non-controlling interests includes the portion of earnings attributable to the 15% shareholding in the business by employees.
^ Operating profit per employee excludes Silica, our third party administration business.


The variance in operating profit over the year can be explained as follows:

Assets under management and flows

£’million AUM 
31 March 
2015 
Net inflows  AUM  
31 March  
2014^
Equities 32 494  2 234  26 310  
Fixed Income 21 950  1 122  20 193  
Multi-Asset 15 122  (444) 14 179  
Alternative 2 657  (184) 3 050  
Third party funds on advisory platform 5 287  408  4 285  
Total 77 510  3 136  68 017  
^ The asset class splits for 31 March 2014 have been restated due to a reclassification of some investment mandates over the financial year.


Assets under management by assets

Assets under management by assets

Investment performance

All of our investment capabilities are managed with the simple aim of delivering performance which meets or exceeds our clients’ expectations around agreed, well-defined return and risk parameters. We measure our investment performance relative to peer groups and against benchmarks over one, three, five and 10-year periods, and since inception. Our long-term track record remains competitive.

Segregated mandates performance

Segregated mandates performance

* Since the inception date of each portfolio, only annualised if inception date is older than 12 months.
   
Source:  Calculated by Investec Asset Management gross of fees, portfolio weighted. Performance to 31 March 2015.
   
Note: Outperformance (underperformance) is calculated as the sum of the total market values for those portfolios that have positive active returns (negative active returns) expressed as a percentage of total assets under management. Market values for the indicated date are used for all periods shown.
   

Independent recognition

Financial year 2015

Winner of CIO Industry Innovation Award in the Emerging Markets category

Winner of EMEA Finance’s Best Asset Manager in Africa Award for the fourth year running

Winner of Private Equity Africa Award for house recognition

Winner of African Banker Award for Fund of the year

Mutual funds investment performance

Mutual funds investment performance


Questions and answers

Questions and answers

Hendrik du Toit

Chief executive officer

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