EDINBURGH investment giant abrdn has hailed its resilience amid “one of the hardest investing years in living memory” as profits fell but beat forecasts in 2022.

Shares in the company, formerly called Standard Life Aberdeen, surged by more than five per cent after it reported a 19% fall in operating profits to £263 million.

abrdn, which employs 2,400 of its 5,300-strong workforce in the Scottish capital, highlighted volatile conditions in global markets as its investment business reported net outflows of £13.4 billion. Net operating revenue from investments was 13% lower at £1.07bn.

However, this was offset by an increase in revenue and profits within the company’s adviser and personal businesses, with the latter reaping the benefits of abrdn’s £1.5bn acquisition of Interactive Investor (ii) in December 2021. The acquisition gave abrdn control of a business that provides services such as share dealing and portfolio management technology to around 400,000 customers.

abrdn declared yesterday the subscription-based services had substantially scaled up its presence in the UK’s savings and wealth market, noting that ii had provided £114m in net operating revenue and £67m in adjusted operating profit since coming into the fold seven months ago.

Meanwhile, abrdn reported that its adviser operation, which provides technology platforms for financial advisers, had benefited from rising interest rates as net operating revenue grew by 4% to £185m in 2022. Adjusted operating profit was 16% higher at £86m.

Overall assets under management at abrdn stood at £500bn on December 31, down from £542bn at the same stage in 2021. And there were total net outflows of £37.9bn, versus £6.2bn in 2021, which reflected the final tranche withdrawal of £24.4bn linked to the end of the Scottish Widows asset management mandate run on behalf of Lloyds Banking Group.

The results were published as abrdn announced a deal to sell its UK discretionary fund management business to LGT, the international private baking and asset management group of the Princely Family of Liechtenstein, for £140 million.

Abrdn, in its previous guise as Standard Life Aberdeen, sold its long-standing life and pensions to Phoenix for £3.2 billion in 2018. That was followed by a deal that saw Phoenix acquire the Standard Life brand name in 2021.

Yesterday, the company underlined the importance of recent diversification, noting that the acquisition of ii had placed its adviser and personal businesses “on a stronger trajectory of growth with more efficient operating margins”.

Stephen Bird, chief executive of abrdn, said: “We are building a stronger abrdn. As we exit year two of our three-year strategic plan, the structure of our group is now broadly set. We are increasingly well positioned for growth. In one of the toughest investing years in living memory, the resilience we have created in our business model helped us to deliver adjusted operating profit of £263m.”

John Moore at RBC Brewin Dolphin said: “abrdn’s results were always going to be messy after a period of huge changes at its businesses and volatile markets last year. While the numbers show a company in flux, the strategic plan continues to reshape the business – the sale of the discretionary fund management division and hollow-out of the managed portfolio service offer another step toward better scale and simplification.”

Shares closed up 11.2p at 224.6p.

A final dividend of 7.3p per share, giving a full-year dividend of 14.6p, was announced yesterday. This will take returns to shareholders in dividends and buybacks to £0.6bn for 2022.