In July 2006, New Star Investment Funds celebrated its fifth anniversary as a retail funds business. From a standing start in 2001, retail funds under management had risen by the time of the fifth anniversary to more than £8 billion while the number of funds had growth to 36. These cover the three major asset classes - equities, bonds and commercial property - plus the increasingly popular fund of funds sector.
New Star Asset Management Group announced its maiden interim results as a public company in September. These showed operating earnings up 90% to £30.5 million on net revenue 52% higher at £59.7 million. Other highlights of the interim results included a rise of 40%** in first half of 2006 net UK retail sales to £712.0 million, a 181% rise in net international retail sales to £180.3 million and a 7% rise in assets under management to £18 billion over the six-month period. The directors declared a maiden interim dividend of 4p per share and said they expected to pay a total dividend of not less than 8p for the full year in the absence of unforeseen circumstances.
The following month New Star picked up two significant group awards. First, Citywire, the financial publishing and fund performance measurement company, named New Star as the overall winner of its Team All Stars 2006 Awards, picking up this coveted accolade for the third year in a row, a unique achievement. The awards are based on individual fund managers' risk-adjusted performance and compare asset management groups on a like-for-like basis across 15 key Investment Management Association (IMA) sectors.
Later in October, the company was named Multi-Manager Group of the Year 2006 by RealAdviser magazine. This award is based on consistency of performance over the three years to 30 June 2006.
In November, the New Star European Growth Fund and the New Star Fixed Interest Unit Trust both exceeded £1 billion in assets under management. European Growth, managed by Richard Pease, delivered top-decile performance not only from its July 2001 launch to 24 November 2006, but also over one, three, and five years. Over the period from its launch, the fund returned 91.6%# and outperformed its IMA Europe excluding the UK sector peer group by 45.4 percentage points, a performance that ranked it fourth out of 78 funds. The Fixed Interest Unit Trust, managed by the Citywire AAA-rated† Theodora Zemek, offers investors a high level of income through a portfolio consisting largely of investment and sub-investment grade corporate bonds, cash convertible bonds and preference shares.
*Before tax, interest, exceptional items, amortisation of intangible assets and front-end fee deferral
** Source: IMA
# Source: Lipper, mid-mid, net income reinvested
† At 31.03.07
Past performance is not necessarily a guide to future performance.