Schroders set to report after mass clear out

Senior management departures, economic headwinds and cooling analyst sentiment suggests tomorrow could be a busy day for Schroders' new boss.

Schroders will lift the lid on its second quarter results tomorrow, after a flurry of speculation about the immediate prospects for the business.

Last week, analysts at Goldman Sachs warned that the fund firm is likely to have difficulties in structuring “compelling” products in the current economic environment, downgrading the firm and removing it from its Pan European buy list.

More notably, though, is the widespread change in personnel at the top of the business over the quarter, with very senior figures (with years of service) departing or changing job roles.

In April, Peter Harrison stepped up to become chief executive after Michael Dobson left the role after some 14 years in the job.

A month later and the group’s chief operating officer Markus Ruetimann quit after more than 12 years with the business. Then, Massimo Tosato, executive vice chairman of the business, announced he too would be going.

It hasn’t just been on the top floor of Gresham Street where the axe has been swinging, however. Schroders chopped out key figures from its trading team in recent weeks too.

Rob McGrath – the group’s head of trading – departed as did Nick Robinson who had previously looked after the fixed income trading team. 

The sheer scale of change, combined with the much-publicised analysts’ notes suggest that Harrison may have a hectic day tomorrow.

Looking at assets under management, the picture looks less bleak, Goldman is predicting that second quarter assets under management will grow by 5%, driven principally by currency movements.

However, the business announced £1.8 billion of retail money left the business in the first three months of the year, despite overall growth in AUM of £11.4 billion.

Analyst sentiment also suggests that second quarter gross sales may be affected by the UK’s EU referendum vote. Schroders declined to comment.

At 1305 hrs (BST), Schroders was trading up 2.5% at 2,651p.