In its half-year results, the alternative asset manager reported statutory profit before tax decreased from $380m during the same period last year to $114m due to significantly lower performance fee revenue in H1. Core profit before tax also fell from $395m to $137m.
Core net revenues decreased to $513m from $855m in the first half of the year, primarily comprised of $460m of core net management fee revenue, down from $469m last year, and a sharp fall in core performance fee revenue, down to $51m from $383m last year.
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The firm said core net management fee revenue was 2% lower due to a relative decrease in total return AUM, while core performance fees of $32m was comprised of $30m from alternative strategies and $2m from long-only strategies.
Core performance fees of $32m during the first half of the year reflected a difficult first quarter for its trend-following absolute strategies, which were negatively impacted by the banking turmoil in March, as the collapse of Silicon Valley Bank and other regional lenders in the US led to a rapid flight to safety.
During the period, Man Group saw record assets under management of $151.7bn, up 6% from $143.3bn in December 2022. The firm also recorded net inflows of $2.6bn, as well as positive performance of $5.1bn.
"We continue to believe that the current environment presents a significant opportunity for active investment managers, particularly those with the ability to offer alpha irrespective of prevailing market conditions and in liquid and customisable format," said CEO Luke Ellis.
"We have built a diversified and resilient business, with a compelling range of investment strategies and solutions, underpinned by high-performing talent and cutting-edge technology."
Man Group to acquire $11.8bn US private credit manager
Robyn Grew, the incoming CEO at Man Group, pointed to the firm's acquisition of Varagon Capital Partners last month, which she said highlighted Man Group's priority to diversify its client offering.
"As the private credit market continues to grow in relevance for the world's largest institutions, this transaction adds a US-focused direct lending strategy designed to provide consistent risk-adjusted outperformance at scale and in a highly customisable format," she said.
"Varagon has a strong track record of underwriting discipline, risk management and generating differentiated returns for investors; this gives us confidence in our ability to support their continued growth as a part of Man Group."