Ninety One PLC and Ltd on Wednesday cut its dividend as the money manager grappled with net outflows amid tough market conditions, but annual profit rose slightly.

The London and Cape Town-based company said its pretax profit was up 2.0% to £216.8 million for the financial year that ended March 31, compared to £212.6 million a year before.

As at March 31, assets under management fell 2.6% to £126.0 billion from £129.3 billion a year earlier. Net outflows narrowed to £9.4 billion, down 11% from £10.6 billion.

Revenue declined to £697.8 million, 6.4% lower than £745.5 million.

‘For the second consecutive year, conditions remained difficult for our industry and for Ninety One,’ the asset manager said.

Ninety One cut its final dividend to 6.40 pence, down 4.5% from 6.70p. This left the total payout 6.8% lower at 12.30p versus 13.20p.

Basic earnings per share and headline EPS inched up 1% to 18.4p from 18.2p.

‘Ninety One, and many other public-markets-centric active investment managers, faced headwinds over the reporting period,’ Chief Executive Officer and Founder Hendrik du Toit. ‘Despite these conditions, we delivered robust financial results.’

Ninety One said the higher-for-longer interest rate environment had depressed the appetite for investment in emerging markets.

Equity market performance was ‘extremely narrow’ for the first part of the year, favouring passive equity investment over active in developed markets.

There are signs that market returns have been broadening towards the back end of financial 2024, which could restore demand for active equity investment in due course, the company said.

‘At the time of writing this report, it was still too early to see evidence of returning demand for emerging market investments,’ it added.

Ninety One shares in London were 3.6% lower at 164.56 pence on Wednesday morning. They also were down 1.2% to R 39.77 in Johannesburg.

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