Quilter PLC (LON:QLT) intends to keep going with its share buyback and to pay a final dividend for last year despite a 14% contraction in assets under management and administration in the first quarter of 2020 due to the effects on financial markets from the coronavirus pandemic.
AuMA stood at £95.3bn at the end of March, down from of £110.4bn at the start of the year.
The wealth management group, which completed its exit from life insurance in January, saw net inflows of £0.5bn in the quarter, pretty much stable on the same period last year, with integrated net flows of £0.8bn following the £2.6bn seen last year.
It said the latter weeks of the quarter saw transfers out of its platform to competitor platforms “reduced significantly while transfers in remained steady, due to a relatively higher level of business continuity and adviser support”.
Returning the proceeds of the £445mln sale of its life assurance arm via a share buyback, Quilter bought back roughly £28mln of shares in the quarter.
Management views the group’s operations as “resilient” and has no intention of changing strategic plans for this year, despite lower AuMA leading to “materially lower” revenues and expected profit margins for the full year.
With cash of circa £750mln held at the end of March and has an estimated pro forma Solvency II ratio of around 210% following planned capital returns, the board said it intends to continue with the first tranche of the share buyback, recommend payment of the 3.5p final dividend at a total cost of £65mln, and to continue with an odd-lot offer for shareholders who hold fewer than 100 shares to sell their shares at a small profit.
Quilter shares fell 3% to 112.55p in early trading on Tuesday.