Abrdn’s demotion from FTSE 100 confirmed

Index compiler FTSE Russell confirmed on Wednesday that Edinburgh-based investment giant Abrdn will drop out of the FTSE 100 index as a result of its September 2022 review.

Falling out of the FTSE 100 index can dampen demand for a company’s shares due to the huge role played in stock markets by giant funds that simply track the performance of the index.

Abrdn’s share price has fallen about 45% in the past year, dragging its stock market value down to around £3.15 billion.

“Abrdn, Hikma Pharmaceuticals and Howden Joinery Group will leave the FTSE 100 index and enter the FTSE 250 index,” said FTSE Russell.

“The rules-driven, impartial quarterly reviews ensure the indexes continue to portray an accurate reflection of the market they represent and form an essential component to the management of the indexes …

“All changes from this review will be implemented at the close of business on Friday, 16 September 2022 and take effect from the start of trading on Monday, 19 September 2022.”

On August 9, Abrdn published first-half results showing its assets under management and administration (AUMA) fell £34 billion to £508 billion in the first half of 2022 amid the global stock market rout.

Abrdn said the drop in assets reflected the lower markets and a final tranche withdrawal of assets by Lloyds Banking Group (LBG) — both of which were partly offset by inclusion of assets from recently-acquired Interactive Investor (ii).

Abrdn reported a loss before tax for the first half of £320 million “largely due to losses of £313m from the change in fair value of significant listed investments (HDFC Asset Management, HDFC Life and Phoenix) as a result of the fall in the share price of these companies in the period.”

Fee based revenue was 8% lower at £696 million and adjusted operating profit 28% lower at £115 million “driven by market movements.”

Total H1 net outflows at Abrdn were £35.9 billion “largely reflecting final LBG tranche withdrawal of £24.4bn.”

Abrdn said it retained £7.5 billion of LBG assets in institutional quantitative funds.

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