GAM Holding, a Switzerland-based wealth management and investment firm, has reported an underlying net profit of CHF210.2 million (US$237.7 million) for 2013, a rise of 30% year-on-year. Earnings per share rose 34% to CHF1.26 from CHF0.94 in 2012.
The group’s operating income totalled CHF670.2 million, up 13% from a year ago. The group attributed the rise mainly to a 12% rise in net management fees and commissions to CHF554.1 million.
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Operating expenses were CHF437.1 million for 2013, up 9% from the previous year. The group’s cost/income ratio was 65.2%, at the top end of the 60-65% targeted over the medium term.
Investment management
Return on assets in investment management for 2013 was 84.3 basis points, up from 75.8 basis points a year earlier. While average assets under management were 4% higher, revenues rose by 15%.
Assets under management in investment management as at 31 December 2013 were at CHF69.8 billion, compared with CHF72.6 billion a year earlier.
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By GlobalDataNet new money outflows in investment management for 2013 totalled CHF2.6 billion, compared with net outflows of CHF0.1 billion in 2012.
Private labelling
The private labelling business, which represents around 6% of Group revenues and provides outsourcing solutions to third-parties, saw a decline in return on assets by 1.9 basis points to 8.7 basis points in 2013.
Average assets under management grew by 5% but net management fees and commissions fell by 13%, reflecting the loss of mandates and lower margins in newly acquired business.
Assets under management at year-end 2013 were at CHF44.6 billion, up CHF1.0 billion from a year earlier, driven by a positive effect from market performance of CHF 2.2 billion.
For 2013, the private labelling business reported net new money outflows of CHF1.1 billion, compared with net inflows of CHF 2.5 billion in 2012.
David Solo, group CEO said: "Despite some near-term headwinds, our group is extremely well-positioned to grow in the years to come. We have the broad range of exceptional equity, absolute return and non-traditional fixed income products that clients demand in today’s challenging marketplace.
"Shorter term, emerging market strategies are likely to continue to see outflows until market sentiment there improves. Looking more broadly at the product range, demand for attractive equity and absolute return strategies continues to grow. In particular, flows into our absolute return bond strategy appear to be stabilising as performance resumes its normal trajectory."
