BlackRock, the world’s largest asset manager, said it would raise its quarterly dividend after reporting the largest net inflows of new client money in its history in 2016.
Reporting its fourth quarter and full year results, the New York-based company said that it had seen a total net inflow of $202bn in 2016, as its total assets under management rose by 11 per cent year on year to stand at $5.14 trillion, reports Miles Johnson in London.
BlackRock’s revenues for the year fell by 2 per cent compared to 2015, and operating income came in a $4.57bn, also dropping by 2 per cent year-on-year. Diluted earnings per share fell 2 per cent for the year to $19.29.
At the same time its operating margin for the whole of 2016 rose by 10 basis points to 41 per cent compared to 2015, and by 270bps in the fourth quarter compared to the same period last year – an increase BlackRock attributed to its focus on keeping expenses and other costs low.
At a time when many in the asset management industry fear for the future of traditional so-called “active” investment products, Larry Fink, BlackRock’s chairman and chief executive officer said that he had continued to see the company’s clients choose to use both active and passive strategies together.
“Investors are rethinking their approach to active management, asset allocation and portfolio construction, and we’re seeing more clients use active and index strategies together to deliver returns,” he said in a statement.
The asset manager said that it would increase its quarterly cash dividend to $2.50 per share, a rise of 9 per cent, and would buy back an additional 6m shares under its current repurchase programme. Over the year its weighted average diluted share count fell by 1 per cent to 166m.
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