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After record profits in 2021, SA's largest asset manager Ninety One has taken a hit from the tough market conditions its CEO, Hendrik du Toit, warned investors about in March. The firm, formerly Investec Asset Management, saw its assets under management slump by 8% to £132.3 billion (R2.7 trillion) in its half-year to end-September, as market returns tanked and £3.2 billion flowed out of its funds.
As a long-term active manager, Ninety One is highly dependent on market performance to generate performance fees and attract inflows. When markets are volatile, as they have been in 2022, more investors tend to run to safe havens, derisking their portfolios by turning their backs on riskier assets such as equities.
A cocktail of that derisking behaviour and lower returns prompted a 16% fall in profit after tax to £84.7 million, while the firm cut its dividend 6% to 6.5 pence.
