Slide 1: abrdn plc Full year results 2022
abrdn plc Full year results 2022 28 February 2023 1 | abrdn plc
Slide 2: Welcome
Welcome • Building a stronger abrdn – Stephen Bird • Refocusing Investments vector – Chris Demetriou • Scaling up our leading UK savings and wealth businesses • Adviser – Noel Butwell • Personal – Richard Wilson • Financial results – Stephanie Bruce • Q&A – Stephen Bird, Stephanie Bruce, Chris Demet
Slide 3: Building a stronger abrdn
Building a stronger abrdn Creating a stronger Refocusing Investments, poised to business model capitalise on areas of strength Scaling up our leading UK savings Redeployment and distribution of and wealth businesses capital generated Creating a sustainable growth trajectory 3 | abrdn plc
Slide 4: Creating a stronger business model
Creating a stronger business model Diversifying revenue and flows… to improve margin mix… to create a stronger model Net operating revenue movement CIR Investments (£161m) Investments 89% 60% Adviser £7m £72m Personal (7 months ii) £109m Adviser 54% £114m abrdn1 (£59m) £263m2 ii (12 months) 47% Net
Slide 5: Investments – Organising for success
Investments – Organising for success Focusing on our strengths to meet the needs of clients Building foundations for growth Organised through two distinct investment pillars Client focused Public markets Alternatives Simplification £289bn £87bn AUM1 AUM1 Reducing costs Supported by long-term market
Slide 6: Investments – Focusing on areas of strength
Investments – Focusing on areas of strength Focusing on our strengths to meet the needs of clients AUM Our capabilities (£bn)1 • £120bn AUM Public Fixed income 120 Fixed • Key focus for 2023 growth markets income • 72% AUM outperforming over 3 years Specialist equities 78 • Strong heritage (Asia/EM,
Slide 7: Investments – Pathway to an improved operating model
Investments – Pathway to an improved operating model Structural transformation is focused on three key areas • 2% cost reduction in 2022, in spite of adverse FX and inflationary pressures Creating an efficient • Headcount reduction in 2022 of 8% and ongoing into 2023 operating model • Exit physical
Slide 8: Adviser - Scaling up our leading UK savings and wealth businesses
Adviser - Scaling up our leading UK savings and wealth businesses Resilient performance driving unlocking further capacity to drive growth and flows margin improvement… for clients… 16% Significant technology CAGR 1. Existing customers release now launched £185m £178m ✓ Modernised, intuitive user in
Slide 9: Personal - Scaling up our leading UK savings and wealth businesses
Personal - Scaling up our leading UK savings and wealth businesses through diversified ii delivering growth… and progressing on growth drivers revenue streams… ii ii (12 months)1 (12 months)1 Strengthening our platform Subscription fees 29.2k new customers New website technology deployed Net operati
Slide 10: Full year 2022 Financial results
Full year 2022 Financial results Stephanie Bruce, CFO 10 | abrdn plc
Slide 11: Performance impacted in difficult macroeconomic environment
Performance impacted in difficult macroeconomic environment Net Adj. Adj. Lower trading result due to IFRS loss operating operating operating impact of market volatility before tax revenue expenses profit (£615m) £1,456m £1,193m £263m 2021 (4%) Flat (19%) £1,115m profit Disciplined management of cap
Slide 12: Evolution of AUMA
Evolution of AUMA Impact on opening AUMA (5%) (2%) (1%) (11%) +10% £542bn Final LBG exit completed £518bn (3%) impact due to net outflows (£24bn) £55bn £500bn (£10bn) (£3bn) Markets impacted AUMA by (11%) ii increased AUMA by 10% (£59bn) Dec 2021 LBG tranche Net flows Liquidity Markets ii Dec 2022 w
Slide 13: Net flows reflect market environment
Net flows reflect market environment Industry abrdn Personal Active UK and Crossborder1 Investments Adviser (pro forma 12 months ii) £250bn Net flows as % Net flows as % £0.0bn of AUM of AUM £6.4bn £3.9bn (4%) £125bn (£2.0bn) (5%) £4.3bn £3.9bn - (£4.0bn) (3%) £1.9bn (7%) £5.8bn £1.6bn (2%) £4.3bn (
Slide 14: Evolution of revenue
Evolution of revenue 2022 Net operating revenue Market impact (7%) (4%) Net outflows impact (1.5%) Mix lowers yield (7%) (1.5%) (2%) +7% M&A revenue accretive +7% £1,515m Cash margin impact +£68m, largely ii £130m £1,456m 2023 12 months contribution from ii (£109m) ii (£23m) £4m £114m Cash margin im
Slide 15: Differing revenue dynamics by vector
Differing revenue dynamics by vector Investments Adviser Personal (pro forma 12 months ii) £185m £263m £1,231m £178m +4% +20% £220m (13%) £1m £11m £1,070m £71m £9m £317m Treasury income £324m £79m £55m Alternatives Trading income Cash margin Platform charge £177m £174m Subscription fees £48m £56m Pu
Slide 16: Cost management key to funding investment for growth
Cost management key to funding investment for growth (14%) 4% (7%) 6% (7%) 2% 5% Reduction Investment Reduction Investment Reduction Investment £1,333m Funding growth - acquisitions £56m £1,206m £70m £1,192m £47m £1,193m £18m (£183m) £20m (£84m) (£84m) 2019 2020 2021 Reduced staff, FX Finimize inter
Slide 17: Cost efficiency by vector
Cost efficiency by vector Investments Adviser Personal (pro forma 12 months ii) CIR £104m CIR £167m CIR £978m 89% 54% 62% (2%) (2%) £956m £164m (5%) £99m 2021 2022 2021 2022 2021 2022 2% reduction reflects FTE reduction and lower 5% reduction reflecting TUPE of c300 staff to 1% cost reduction in ii
Slide 18: Cost actions in Investments to deliver refocused franchise
Cost actions in Investments to deliver refocused franchise Net c£75m reduction in 2023 and before disposal of non-core assets £978m Net c£75m reduction £956m 2021 2022 Fund Equity and multi-asset Transition to single Headcount 2023 rationalisation reorganisation middle office provider reductions 18
Slide 19: Continued financial discipline over our strong balance sheet
Continued financial discipline over our strong balance sheet Deploying strong capital resources for growth Delivering efficient capital stack £4.1bn Movement in available capital1 £3.1bn total resources Value of £0.8bn listed c£1.3bn3 investments listed c£2.3bn2 investments £0.3bn £2.0bn Value of £1
Slide 20: Clear approach to capital generation and allocation
Clear approach to capital generation and allocation Regulatory capital surplus Value of listed stakes1 Adjusted capital £0.7bn c£1.3bn generation Allocation of available capital resources Returns for Non-core shareholders disposal proceeds Inorganic Management Return bolt-on buffer Dividend signific
Slide 21: Building a stronger abrdn
Building a stronger abrdn Creating a stronger Refocusing Investments, poised to business model capitalise on areas of strength Scaling up our leading UK savings Redeployment and distribution of and wealth businesses capital generated Creating a sustainable growth trajectory 21 | abrdn plc
Slide 22: Q&A
Q&A 22 | abrdn plc
Slide 23: Appendix
Appendix 23 | abrdn plc
Slide 24: Investments
Investments FY 2022 FY 2021 Change Net operating revenue £1,070m £1,231m (13%) Adjusted operating expenses (£956m) (£978m) (2%) Adjusted operating profit £114m £253m (55%) Cost/income ratio 89% 79% +10ppts Net operating revenue yield1 25.4bps 25.9bps (0.5bps) Gross flows £59.3bn £63.4bn (6%) Net flo
Slide 25: Adviser
Adviser FY 2022 FY 2021 Change Net operating revenue £185m £178m +4% Adjusted operating expenses (£99m) (£104m) (5%) Adjusted operating profit £86m £74m +16% Cost/income ratio 54% 58% (4ppts) Net operating revenue yield 26.1bps 24.9bps +1.2bps Gross flows £6.6bn £9.1bn (27%) Net flows £1.6bn £3.9bn
Slide 26: Personal
Personal Personal ii FY 2022 FY 2021 Change Wealth (7 months) Net operating revenue £87m £114m £201m £92m +118% Adjusted operating expenses (£82m) (£47m) (£129m) (£84m) +54% Adjusted operating profit £5m £67m £72m £8m +800% Cost/income ratio 94% 41% 64% 91% (27ppts) Net operating revenue yield1 59.2
Slide 27: Forward-looking statements
Forward-looking statements This document may contain certain ‘forward-looking statements’ with respect to the financial COVID-19 (coronavirus) outbreak; climate change and a transition to a low carbon economy condition, performance, results, strategies, targets, objectives, plans, goals and expectat
Slide 28: abrdn plc registered office and website
abrdn plc is registered in Scotland (SC286832) at 1 George Street, Edinburgh, EH2 2LL www.abrdn.com © 2023 abrdn. All rights reserved. 28 | abrdn plc