Where Main Street Meets Wall Street

Will Abrdn be successful in cutting costs as well as vowels?

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Other results and updates are expected from Bellway, Gamesys, Intercontinental Hotels, IWG and M&G

Tuesday will see the market given another chance to get used to (), the slightly odd and difficult to pronounce name for the company previously known as Standard Life Aberdeen until last month.

The FTSE 100-listed company is “on a mission to turn around a business that has been exceptionally unexceptional for some time”, according to Nicholas Hyett, an equity analyst at Hargreaves Lansdown.

“The group, now overwhelmingly focussed on fund management, is looking to cut costs while improving investment performance and expanding its distribution network. If it can do all three – charging fees on more money, for more clients, and on a lower cost base – it would be a heady mix for profits – unfortunately it’s also a familiar playbook for any asset manager and not one that always delivers,” Hyett cautioned.

“We’re only in the very early days of the new strategy, and tangible progress next week is likely to be minimal. That won’t stop analysts scrutinising management comments closely – the group has work to do to convince investors it deserves the benefit of the doubt after years of lacklustre results,” he suggested.

The market is expecting that net outflows in the first half will be around £2.1bn.

Flutter down but by no means out 

Interim numbers are chalked on the board for Paddy Power and Betfair owner (), which has seen its shares lose a quarter of their value since reaching an all-time high in March.

The FTSE 100-listed group was reported last month to have stalled the planned spin-out and IPO of its FanDuel US sports betting business until next year, having revealed just weeks earlier that the business’s boss had given his notice.

Flutter’s last trading update was back in April, when it reported 32% growth in revenues for the first quarter, almost all of which originated from its online operations.

Looking ahead, the group predicted its sports betting business would see “accelerated growth” in the second quarter of 2021 compared to last year because of the previous impact of the pandemic on the sports schedule, although it said its gaming products are likely to face “more challenging comparatives”.

In a recent note, broker Peel Hunt said the shares, having performed poorly this year, now represent “good value,” as the group averaged 7.7mln monthly players in the first quarter, up 36% year-on-year, and its shift to “more sustainable mass-market gambling” is expected to have continued through the rest of the first half.

Significant news on Tuesday 10 August:

Trading updates:  (),  ()

Interims: Abrdn PLC,  (), Flutter Entertainment PLC,  (),  (), () Group PLC,  (),  () 

Economic data: UK retail sales



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