Liontrust falls into red as performance fee revenue collapses

Liontrust's revenue fell from £243m to £198m, even as administration expenses continued to rise.

Liontrust fell into the red last year as revenue at the British asset manager fell by almost 20 per cent.

In the group’s results to 31 March, it revealed that its statutory profit before tax had fallen from £49m to a loss of £579,000 as it struggled with a slowdown in UK equities and its bungled attempt to purchase Swiss rival GAM.

Liontrust’s assets under management fell by 11.5 per cent throughout the year, from £31.4bn to £27.8bn, while statutory operating profit fell from £49m the year before to a loss of £1.8m.

A large part of the profit decline was due to a fall in performance fee revenue, which almost halved from £18.5m to £10.4m.

In total, revenue fell from £243m to £198m, even as administration expenses continued to rise.

The value of the assets the company controls has continued to decline since the end of the reporting period, getting as low as £27.25bn by the end of last week.

The once mighty British asset manager has seen its share price fall by 70 per cent since its peak in September 2021 and is flat over the last year.

“The outflows of assets from UK equity funds and depressed valuations of UK listed companies is threatening the robustness of the stock market,” warned Liontrust CEO John Ions.

“Many fantastic UK companies are being taken private too cheaply, are subject to takeovers by overseas companies or are choosing to list outside the UK.”

In the company’s results, Liontrust’s chair stressed the need for the company to diversify its business, rationalising its failed attempt to buy GAM last year as a selective acquisition that would have allowed the firm to “expand rapidly our investment management and distribution capability”.