At the end of September, Aberdeen’s assets under management were £283.7bn compared with £324.4bn a year earlier – a fall of 12.5%. Net outflows were £33.9bn and equivalent withdrawals from equity funds increased to £16.4bn from £13bn the year before.
Emerging markets, which Aberdeen specialises in, have fallen from favour this year amid concerns about global growth, particularly in China, where the economy is slowing sharply.
Investors have also pulled money out of emerging markets in expectation of rising US interest rates, causing the final quarter of Aberdeen’s year to be the worst for outflows from these markets since the financial crisis.
Aberdeen’s net fund outflows hit £12.7bn in the fourth quarter, up from almost £10bn in the preceding three months and the 10th straight quarter of net outflows.
Shares of Aberdeen, down by a third since April, fell 4% on Monday morning to 321.5p.
Underlying pre-tax profit in the year to the end of September rose by £1.3m to £491.6m and net revenue increased 5% to £1.17bn, helping fund an 8.3% increase in the dividend to 19.5p a share.
Martin Gilbert, Aberdeen’s chief executive, said: “The cyclical correction in Asian and emerging markets and resulting negative investor sentiment has, as expected, led to further flows from our equities business.
“While we believe the current weakness may have some way to run, the long-term fundamental attractions of investing in these high-growth economies remain compelling for patient investors.”
Aberdeen’s prominence increased as it concentrated investments in Asian and other emerging markets. Those bets paid off while developing economies grew and mature markets such as the US and Europe suffered after the financial crisis but China’s slowdown has hit confidence in emerging markets.
Gilbert, who founded Aberdeen in 1983, said the company’s decision to broaden its products and expand into developed markets such as the US had helped underpin a solid set of results. Speculation emerged last month that Gilbert might sell Aberdeen but he said the company was determined to stick to its strategy to benefit clients and shareholders.
“We continue to rebalance and diversify the business, to focus on managing our costs and to generate cash and this has helped to mitigate the impact of the outflows we’ve seen,” Gilbert said.
Aberdeen said it had found £50m of cost savings it would make later in the current financial year with the full benefit coming through the following year.
The company acknowledged its share investments had performed worse than their benchmark indexes but said it would continue to manage funds actively to seek returns that beat benchmarks.
Analysts at the broker Numis said investor worries and Aberdeen’s mixed performance combined with uninspiring prospects for earnings meant “we see no obvious reason to rush to buy today”.