LONDON Jan 18 Man Group, the
world's biggest listed hedge fund manager, looks set to report
further heavy client outflows on Wednesday, as nervous investors
pull out of its poorly-performing funds.
The firm, whose share price has slumped from around 300
pence a year ago to 107 pence at Tuesday's close, is expected to
report net client withdrawals of $2.3 to $2.9 billion over the
three months to December, according to analysts.
Analysts have been cutting their forecasts after the shock
news that Man lost $2.7 billion in outflows in the third quarter
of 2011, knocking its tentative recovery off course and sending
its shares tumbling 25 percent in a single day.
While fund managers have seen clients exit as Europe's debt
crisis hits financial markets, Man has also been hindered by the
performance of some funds in its GLG unit which it bought for
$1.6 billion in 2010.
It has also seen its flagship $24.4 billion computer-driven
fund AHL lose 6.4 percent in 2011. In contrast, Winton Capital,
a rival to AHL that manages $28 billion, saw its main fund gain
6.3 percent last year.
Meanwhile, analysts have questioned whether Man
can maintain its dividend payout, which, according to Singer
Capital Markets, should be cut.
But Peter Lenardos, analyst at RBC Capital Markets, said the
dividend was sustainable in the short term and said he expected
figures in line with market expectations on Wednesday.
"What investors should be focusing on is balance sheet
strength and if the company is instituting a further share
buyback programme and a formal dividend policy," he said. "I
will be interested to learn what funds they anticipate marketing
early in 2012."
In November Man announced a $150-million share buyback plan
in an effort to put a floor under its sagging market value.
Lenardos added: "One thing we've got to make sure is that we
don't get overly excited about things (that Man Group announces)
that weaken the balance sheet. Let's not take short-term
measures when it's putting the company at a disadvantage in the
long term. The company needs to position itself in case fund