Standard Life profits rise on eve of £11bn Aberdeen merger

Standard Life has today disclosed a rise in half-year profits ahead of its mega merger with fellow Scottish financial giant Aberdeen Asset Management next week.

The Edinburgh-based life and pensions giant said pre-tax operating profits for the six months to the end of June rose 6 per cent to £362 million – ahead of the £353 million pencilled in by City analysts.

Assets under administration edged ahead by 1 per cent to £361.9 billion, helped by “record” net inflows into its adviser platforms, while fee-based revenues grew 5 per cent to £836 million. Shareholders will receive an interim dividend of 7p a share – an increase of 8.2 per cent on last time.

The news comes just prior to the creation of an industry monster through its £11 billion tie-up with Aberdeen, which is due to complete on 14 August following final approval expected at a court hearing scheduled for Friday.

The deal, which was announced back in March, will result in ‘Standard Life Aberdeen’, which will be one of the world’s biggest fund management groups boasting some £670 billion of assets.

The merging of the businesses is set to deliver cost savings of £200 million a year, with about 800 jobs expected to be lost from a combined global workforce of 9,000 over a three-year period.

It has already been announced that Standard Life Aberdeen will be jointly run by current Standard Life chief executive Keith Skeoch and his Aberdeen counterpart, Martin Gilbert.

Mr Skeoch said: “Standard Life has delivered a strong performance in the first half of 2017 with fee based revenue up 5% and operating profit up 6%. We continue to see the benefits of targeted investments to further our diversification agenda, the success of our newer investment solutions and the ongoing focus on operational efficiency. This has allowed us to grow assets, profits, cash flows and returns to shareholders.

“With the proposed merger with Aberdeen on track for completion on 14 August we are ready to accelerate the pace of strategic delivery as we open the next chapter of our transformation to a diversified world-class investment company. The combined leadership team of Standard Life and Aberdeen has been working well together to ensure “Day 1” readiness. We are well placed to continue to meet changing client and customer needs globally, and to generate growing and sustainable returns for our shareholders.”