London-headquartered investment manager Rathbones has just released its preliminary financial results for 2023, following its integration with Investec Wealth & Investment.

Rathbones has reported a 10.1 per cent drop in profit before tax to £57.6 million ($73 million) from the previous year’s £64.1 million. This mainly reflects the acquisition and integration costs related to the integration with Investec Wealth & Investment (IW&I), along with higher amortisation charges after the transaction. 

However, the underlying profit before tax increased by 30.9 per cent to £127.1 million, from £97.1 million in 2022, including a £25.4 million contribution from IW&I in the final quarter, Rathbones said in a statement.  

The dip in profit before tax was accompanied by a drop in earnings per share, which fell to 52.6p from 83.6p. However, underlying earnings per share increased to 135.8p from 130.8p, reflecting the firm’s strength.

Underlying operating margin also rose to 22.3 per cent from 21.3 per cent, including the planned £14.4 million expenditure on its digital programme. 

Total funds under management and adminstration reached £105.3 billion, up from £60.2 billion, including £42.2 billion from IW&I, the firm added.  

Meanwhile, the board recommends a final dividend of 24p for 2023, making a total of 87p for the year, an increase of 3.6 per cent on 2022. The dividend will be paid on 14 May 2024, subject to shareholder approval at the firm's 2024 Annual General Meeting on 9 May 2024.  

“2023 was a transformational year for Rathbones as we announced our combination with Investec Wealth & Investment," Paul Stockton, group chief executive, said.

Acquisition and integration costs incurred from the transaction, which went through in the final quarter of 2023, reached £36.5 million. The firm said that the integration work to combine Rathbones and IW&I is progressing well, with the consent process that precedes the migration of clients on to the Rathbones platform expected to be concluded during 2024 with full migration in early 2025 as planned. 

“We remain resilient and well positioned to withstand some of the challenging investment market conditions we saw this year and our 2023 results reflect this,” Stockton added.