British asset manager Aberdeen's shares hit by £3 billion outflows

By Iain Withers

LONDON, July 29 (Reuters) - British asset manager Aberdeen Group posted deeper net outflows of £3 billion ($4 billion) in the first half of the year, as client withdrawals from its investment and adviser units outweighed strong growth for its retail platform interactive investor.

The net outflows were bigger than the £900 million reported for the same period a year ago and compared to average analyst forecasts for a modest inflow.

Aberdeen's shares were down 7% in early trading. 

The company has been undergoing a turnaround under CEO Jason Windsor, including a cost-cutting drive that has helped lift its shares 21% this year ahead of Wednesday's results, promoting it back into the FTSE 100 index.

Windsor told reporters that interactive investor pulled in a record £6.8 billion, but that some bigger clients in its other units were leaving and using fewer partners to manage their money. The company has hired Rich Denning from M&G to head up the adviser unit and improve performance, he added.

Assets under management were £579.4 billion and adjusted operating profit came in at £151 million, up 21%, both narrowly beating forecasts.

Windsor said that in response to the escalating conflict in the Middle East, Aberdeen was running through multiple scenarios with clients for how it could impact investments.

“We are concerned about inflation... Some of the tightening of supply particularly of oil, it is unclear when that returns to normal, whatever normal is," he said.

Aberdeen presented its results from its subsidiary interactive investor's headquarters in Manchester, where it has hired 100 staff this year, to bring the total to 800 in the northern English city.

Elsewhere, shares in wealth managers St James’s Place and Rathbones were down around 1% in early trading after mixed results. 

($1 = 0.7519 pounds)

(Reporting by Iain Withers, Additional reporting by Atharva Singh; Editing by Andrew Heavens, Elaine Hardcastle)