Aberdeen Asset Management shares hit by fund outflows

Aberdeen Asset Management's share price has taken a hit after the company reported a sharp fall in the value of funds under its control.

In the 12 months to September, assets under management fell by 12.5% to £283.7bn.

The company also recorded its 10th consecutive quarter of net fund outflows.

Aberdeen said weak investor sentiment towards Asia and emerging markets was a major contributing factor.

By mid-morning, its share price was down by more than 4%, at 320.3p.

Aberdeen said: "Asian and emerging markets are undergoing a cyclical correction.

"Traditionally these are areas of significant strength for Aberdeen, but we have experienced outflows from some investors who have made their asset allocation decisions on the basis of their macroeconomic views on these markets."

Despite the increase in net outflows, Aberdeen reported a 5% increase in net revenue, to £1.17bn, while underlying pre-tax profit was up slightly at £491.6m.

'Cyclical correction'

Chief executive Martin Gilbert said: "These solid financial results reflect, in part, the work we have undertaken to diversify the business and maintain a strong balance sheet.

"The cyclical correction in Asian and emerging markets and resulting negative investor sentiment has, as expected, led to further flows from our equities business.

"While we believe the current weakness may have some way to run, the long term fundamental attractions of investing in these high growth economies remain compelling for patient investors."

He added: "We continue to rebalance and diversify the business, to focus on managing our costs and to generate cash and this has helped to mitigate the impact of the outflows we've seen.

"We intend to continue with this strategy alongside ensuring we continue to deliver long term value for our clients and shareholders."