Aberdeen Group (ABDN) H2 2023 earnings summary

Executive summary

• 2023 adjusted operating profit was £249m, down 5% YoY, as growth in interactive investor and Adviser offset a sharp decline in Investments. IFRS profit was £12m, versus a restated £546m loss in 2022.

• Strategic priorities include growing UK savings and wealth, refocusing Investments on strengths, and improving efficiency and profitability.

Financial highlights

• Net operating revenue was £1,398m, down 4% YoY; adjusted operating expenses were £1,149m, down from £1,193m.

• Adjusted profit before tax was £330m, up 30% YoY; adjusted diluted EPS was 13.9p versus 10.5p.

• Adjusted capital generation was £299m, up 15%; net capital generation was £178m versus £81m.

• IFRS profit for the year was £12m, compared with a restated IFRS loss of £546m in 2022.

Outlook and guidance

• Targeting at least £150m of annualised cost savings by end-2025; plan includes c.500 role reductions and an estimated £150m of implementation costs over 2024–2025.

• Transformation plan expected to make costs net £60m lower in 2024; Investments adjusted operating expenses targeted to fall c.24% versus 2022.

• Medium-term dividend coverage target remains 1.5x adjusted capital generation; annual dividend was 14.6p for 2023.

• Outlook balances structural growth in UK savings and wealth with active asset-management headwinds and a higher-for-longer interest-rate environment.