Ashmore Group (LSE:ASHM) reported a steep headline earnings miss, with UBS citing weaker-than-expected performance and other fees, together with higher variable compensation costs linked to realised seed-capital gains, masking results that were otherwise mostly in line with consensus.
Shares inched up 1% to 219.60p, while UBS maintained its 'neutral' rating and said the headline miss could still prompt a low-single-digit percentage decline in the stock.
Central to the update was financial year 2026 adjusted EBITDA of £35.7 million, down 32% year on year and resulting in a large 21% miss against consensus.
UBS said most of the shortfall reflected those lower-than-expected performance fees, as well as higher variable compensation costs linked to the realised seed-capital gains.
Net management fees were £128.2 million, broadly in line with consensus estimates and down 2% year on year.
Performance fees fell to £1.4 million from an estimate of £4.2 million, while adjusted net revenue of £135.6 million was 3% below consensus, and the company maintained its full-year dividend at 16.9p per share.
Analysts noted discipline in fixed costs, which were 2% below consensus, while total operating expenses were 5% above consensus due to higher variable compensation costs.
The bank calculated that Ashmore’s adjusted EBITDA margin would have been 40% in 2025, versus 37%, excluding the variable compensation linked to realised seed-capital gains.
Seed-capital gains were £82.5 million, ahead of consensus expectations of £72.5 million, helping to limit the miss in financial year 2026 profit before tax to 1% below consensus at £126.9 million.
Framing the forward view, UBS reported no change to Ashmore’s outlook or guidance, retained its 209p target price, and said the next earnings update was likely to be in line with consensus.
