Man Group Reports Strong Demand For Its Fund Products

by Phillip Morton, Investors Offshore.com

12 July 2006

Man Group plc, the world's largest listed hedge fund firm, has reported continued strong growth for its fund products in the three months to the end of June 2006, as sales in the period since year-end in March grew by more than $5 billion.

"Demand for our fund products has been very strong, both from private investors and institutions," Harvey McGrath, Chairman of Man Group, stated at the firm's annual general meeting yesterday.

"Group funds under management have increased from $49.9 billion at the end of March, to over $54 billion at 30 June. The Group's brokerage business, Man Financial, has started the year strongly and has seen record volumes in the first quarter. In addition, Refco continues to contribute ahead of expectations at the time of its acquisition. The Board remains very confident of the Group's prospects for the year," Mr McGrath added.

In the first quarter of the company's financial year, $5.3 billion worth of sales were achieved, of which Man's global launch, Man IP 220 Ltd, accounted for $1.0 billion. Other private investor sales accounted for $1.4 billion, of which $0.7 billion was from the multiple regional offerings of the Man IP 220 product.

Joint venture sales accounted for $0.1 billion. Institutional sales in the quarter were $2.8 billion. Net movements in the leverage on prior year sales added around $0.5 billion along with positive FX of around $0.5 billion offset by negative performance of around $0.5 billion.

The split of funds under management is private investor $32.5 billion (31 March 2006: $30.4 billion) and institutional $21.5 billion (31 March 2006: $19.5 billion).

Redemptions totalled $1.5 billion, of which private investor were $0.6 billion. The most recent global launch, Man AP Enhanced Series 3 Ltd, raised $0.6 billion but will not start trading until mid-July, and has not been included in the figures for the first quarter.

Last month, Man Group announced record full-year profits as pre-tax earnings rose by 51% to $1.3 billion, thanks to an increase in client money and growth in performance fee income over a period when hedge funds enjoyed their best and most consistent returns for years.

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