City of London Investment Group funds under management update and dividend

City of London Investment Group plc (LON:CLIG), a leading specialist asset management group offering a range of institutional and retail products investing primarily in closed-end funds, announced today that on a consolidated basis, as at 31 December 2021, FuM were US$11.1 billion (£8.2 billion). This compares with US$11.4 billion (£8.3 billion) at the Group’s year end on 30 June 2021. A breakdown by strategy follows:

 FuM ($ million)   Strategy Index 
 Dec-21Sep-21%Net%
 (estimate)increase/Flowsincrease/
 (decrease)(decrease)
EM4,8004,937-3%-149MSCI EM Net TR-1.30%
KIM3,9493,8902%-53Not applicable 
INTL2,1471,84017%265MSCI ACWI  ex US1.80%
OV2322291%-4ACWI/Barclays Global Agg2.00%
Other*22220% 
 11,15010,91859 
        

* includes Frontier, REIT and seed investments

Funds under Management figures are rounded

IM Performance

Solid relative performance across CLIG’s investment strategies resulted from good NAV performance at the underlying closed end funds and positive discount effects.

Over the period, there were net inflows of circa US$59 million across the Group’s strategies, due to asset raising for the International Equity strategy. Year-end rebalancing and tax planning led to outflows from the EM and KIM strategies.

Business development will focus on EM, International, and Opportunistic Value strategies, and KIM balanced mandates, where additional capacity is now available for prospects.

Operations

City of London Investment Group income currently accrues at a weighted average rate of approximately 72 basis points of CLIM’s FuM and at approximately 76 basis points of KIM’s FuM, net of third party commissions. “Fixed” costs are c. £1.6 million per month, and accordingly the current run-rate for operating profit, before profit-share is approximately £3.3 million per month based upon current FuM and a US$/£ exchange rate of US$1.3532 to £1 as at 31 December 2021.

The Group estimates the unaudited profit before amortisation and taxation for the six months ended 31 December 2021 to be approximately £15.5 million (2020: £9.9 million).

Inclusive of our regulatory and statutory capital requirements, cash in the bank stood at £24.5 million at the end of the calendar year (£25.5 million as at 30 June 2021), in addition to the seed investments of £6.1 million. Our cash reserves will allow us to continue managing the business conservatively through volatile markets while following our dividend policy for our shareholders.

The Company is currently in a close period which will end with the publication of results for the six months ended 31 December 2021 on 18 February 2022.

Dividend

The Board declares an interim dividend of 11p per share, which will be paid on 25 March 2022 to shareholders registered at the close of business on 25 February 2022 (2021: 11 pence).

In addition, the Board announces a special dividend of 13.5p per share, which will also be paid on 25 March 2022 to shareholders registered at the close of business on 25 February 2022 (2021: Nil).

Shareholders may choose to reinvest their dividends using the company’s Dividend Reinvestment Plan, to do this please visit www.signalshares.com or if you hold your shares through a broker please contact them. The deadline to lodge your election is 4 March 2022.

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