abrdn Q4 Earnings Call Highlights

Core Insights - The company reported strong performance with significant net inflows and customer growth, indicating a positive market position and strategic execution across its business lines [4][5][6]. Group Performance - Interactive Investor (II) achieved £1.4 billion in net inflows for the quarter, totaling £7.3 billion for the year, a 28% year-on-year increase, representing 9% of opening assets under management and administration (AUMA) [4]. - The platform ended the year with 500,000 customers, a 14% increase year-on-year, and daily average retail trades reached a record 29.2 thousand, up 40% from the previous year [5]. Cash Management - The company reported cash balances around £8 billion, expected to remain stable at approximately 8%–10% of overall assets, with increases attributed to tax-free cash releases and uninvested SIPs [1]. - The cash deposit margin is projected to be in the range of 210–220 basis points for 2026, with further guidance to be provided in March [2]. Pricing Strategy - Pricing changes announced in December are set to take effect in February, aimed at simplifying the proposition and enhancing competitive positioning, with expectations of increased trading volumes and customer growth [3]. Adviser Business - The Adviser business saw AUMA increase to over £80 billion, although net outflows in Q4 were elevated at £0.8 billion due to market uncertainty, resulting in increased tax-free cash withdrawals [7]. - Full-year net outflows improved by 44% to £2.2 billion, attributed to earlier repricing and a focus on service, with an average net promoter score of +45 [8]. Investment Performance - In Investments, AUM increased by 6% to £390 billion, supported by market performance, despite Q4 net outflows of £3 billion [11]. - Institutional and retail wealth gross inflows in Q4 rose 26% year-on-year, with positive net flows for the year at around £5 billion when excluding liquidity flows [12]. Future Outlook - The company expects the investment revenue margin to be around 19 basis points in 2026, with a focus on improving performance and managing outflows [14]. - Full-year 2025 adjusted operating profit is anticipated to align with current market expectations, with targets of at least £300 million for adjusted operating profit and net capital generation for 2026 [19].