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M&G profits sink

Lucy Roberts
Thursday 01 June 1995 18:02 EDT
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M&G, the investment management group, reported a slide in pre-tax profits of pounds 3.6m to pounds 27.6m for the six months to March.

Sir David Money-Coutts, chairman, said the 11 per cent fall in profit over the same period last year was largely because of investment in the company's three-year reorganisation of its administrative processes and increased marketing expenses.

Funds under management grew to pounds 12.2bn from pounds 11.8bn, increasing the group's market share, measured by funds under management, from 10.2 to 10.9 per cent.

The group reported an 11 per cent increase in annual fee income on the back of strong sales of products with little or no initial charge for the customer.

Sir David said that more of the group's revenue would come from annual rather than initial fees. Although the profitability of low-cost start- up products was not initially good, it would increase significantly. The interim dividend rose 8 per cent to 14p.

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