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Highlights:
- Abrdn reports £3.1 billion in net outflows across all segments in Q3 2024.
- Chief executive Jason Windsor vows to address performance challenges and drive transformation.
- Abrdn targets up to £150 million in cost savings by the end of FY2025.
Shares in Abrdn PLC (LSE:ABDN) tumbled nearly 10% after the asset manager continued to struggle in the third quarter of 2024, reporting net outflows of £3.1 billion across its business segments. The company's core investments division experienced the most significant hit, with £3.5 billion in net outflows. Meanwhile, its advisor segment also saw a £1 billion decline in assets.
On a more positive note, inflows into its retail investment platform, interactive investor, helped partially offset the outflows in other areas. However, the broader performance of the company remained lukewarm, contributing to a continued slide in investor confidence.
Chief executive Jason Windsor acknowledged the challenges and outlined plans to tackle the underperformance. "We have strong, scale positions in attractive markets, and each of our businesses has headroom to grow," Windsor said in a statement. He highlighted the company's focus on transforming performance, improving the client experience, and strengthening talent and culture.
Despite the disappointing results, Abrdn is working on a transformation programme to drive long-term, sustainable growth. Windsor remains confident in the company's ability to make progress, saying, “While there remains much to do, I am confident that we have great talent and we can make further progress towards profitable and sustainable long-term growth, benefiting our shareholders, clients, and colleagues."
To address the ongoing challenges, Abrdn aims to achieve up to £60 million in cost savings this financial year, with a target of at least £150 million in savings by the end of the 2025 financial year. This cost-saving initiative is part of a broader effort to streamline operations and improve profitability in the coming years.
The market reacted swiftly to the Q3 update, with Abrdn's share price dropping more than 7.5% in early trading. The company now faces the task of reversing the outflows and restoring investor confidence through its transformation programme and strategic cost-saving efforts.
