* Pretax profit for year to end-March up 5 pct to 9.62 mln
* Assets under management $5.08 bln
* "Reasonable assumption" that inflows continued since March
* Polar's fund managers see opportunities to buy cheap
* Dividends for the year up 20 pct to 9 pence
By Laurence Fletcher
LONDON, June 13 Fund firm Polar Capital
posted higher profits after its strongly-performing funds
attracted more than $1 billion of net client cash over the past
year, and its CEO pointed to further inflows despite investor
caution over the euro zone debt crisis.
The London-based firm, which has been winning clients to its
mutual funds at a far greater rate than investors have exited
its hedge funds, said pretax profit for the year to end-March
rose 5 percent to 9.6 million pounds ($14.9 million), roughly in
line with analyst forecasts.
The firm saw strong inflows into its Japan, global
insurance, healthcare and North America funds, CEO Tim Woolley
told Reuters. Seven of its eight long-only funds were in the top
quartile of performance over the year, while four of its six
hedge funds made money.
Woolley declined to give details of fund flows since March,
but said it was "a reasonable assumption" that inflows seen in
the year to March had continued.
Polar's assets under management at the end of March stood at
$5.08 billion, almost one-third higher than a year before.
Woolley also said that hedge fund flows had "stabilized",
after poor performance in 2010 from its UK hedge fund, which has
since been closed.
"We're at a turning point," he added. "We hope we'd start to
grow hedge fund assets."
Peel Hunt analyst Mark Williamson, who rates the stock a
hold, said in a note that Polar's results had met his
He added that while the stock was on a higher rating than
the sector, that "strikes me as a justified premium given the
higher rates of growth and operational leverage ... in the Polar
Polar's shares were trading at 1.91 percent higher at 189.4
pence at 1008 GMT.
In March chief executive and co-founder Tim Woolley sold 1
million pounds' worth of his shares at 200 pence each.
Woolley told Reuters on Wednesday that the sale was part of
a previously-agreed short-term programme of sales to boost
liquidity, which had now finished.
Polar's flows mark it out as one of the better performers in
a sector in which some firms are suffering amidst investor
caution over the euro zone while others are still winning new
Last month Henderson reported a net outflow of 857
million pounds during the first quarter, although Aberdeen Asset
Management reported a net inflow of 2.4 billion pounds.
Meanwhile, hedge fund manager Man Group, whose
shares have fallen by three quarters since the start of last
year, posted a $1 billion net outflow in the three months to
Woolley said market conditions remained difficult, but that
fund managers at Polar had seen good opportunities to pick up
"We're in a very tough environment, which is almost becoming
the norm," he said.
"It's difficult to analyse. But the encouraging thing there
is that, on a corporate level, a lot of companies are still
doing pretty well ... Valuations look pretty reasonable,
certainly compared with some of the (government) bond levels."