STANDARD Life Aberdeen (SLA) saw more than £500 million wiped from its stock market worth after it reported further outflows from key funds and warned market conditions remain “tough” because of continuing macroeconomic and political uncertainties.

As the prospect of a no-deal Brexit looms ever larger, and tension persists between the US and China, shares in the Edinburgh-based investment giant plummeted by nearly eight per cent as it conceded the background uncertainty was continuing to affect investor sentiment.

The warning came as SLA, which employs 6,000 staff around the world, stemmed net outflows from its funds in the first half of the year. The company reported net outflows of £15.9 billion for the first half, compared with the £24bn reported last year, while assets under management and administration (AUMA) climbed to £577.5bn from £551.5n at the end of 2018.

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However, while investment performance improved and outflows were staunched, SLA said demand for global equities remains low.

George Salmon, equity analyst at Hargreaves Lansdown, said stemming net outflows remains the biggest challenge for SLA, particularly as the outflows are concentrated on two of its highest-margin areas – equities and GARS.

Mr Salmon said: “While less negative than last year, outflows remain Standard Life Aberdeen’s Achilles heel with billions of pounds of investors’ money walking of the door every quarter.

“That’s particularly problematic because a strategic repositioning that culminated in the sale of the Phoenix (insurance) means the group is increasingly focused on asset management rather than insurance.

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“Another reason outflows are hurting is that they’re coming in the group’s higher margin segments, equity and total return.”

Mr Salmon added that SLA was being affected by factors outside its control, which as well as Brexit uncertainty extends to global tensions such as the ongoing dispute between China and the US over trade tariffs.

He said: “A silver lining is that the performance of the funds across the board is getting better.

“However, in those two areas it is still not where they’d like it to be versus benchmark.

“It is kind of chicken and egg a little bit. If you can get your performance going you can attract investment in. There is potential for self-help here by basically picking better strategies.”

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The firm made an adjusted profit before tax of £280 million, short of analysts’ expectations and down from £311m, which reflected a fall in revenue.

Fee-based revenue dipped to £815m from £966m, although this was offset by a cut in operating expenses to £673m from £712m.

The revenue fall was also offset by profits made from from the insurance business SLA sold to Phoenix Group last year. The deal saw Phoenix pay SLA £2.3bn in cash for the bulk of Standard Life Pensions and Savings, with SLA retaining a 20% stake in the business.

The period saw SLA achieve a notable victory over Lloyds Banking Group over the Scottish Widows mandate, having successfully challenged the bank’s move to cancel the £109 billion asset management contract. As part of the settlement, £35bn of Lloyds’ assets will remain under the management of SLA until April 2022 at the earliest. Lloyds also agreed to pay SLA £140m in compensation.

In March, the company brought its controversial dual-leadership structure to an end.

Fund management veteran Martin Gilbert, who had been running SLA jointly with Keith Skeoch since the merger of Standard Life and Aberdeen Asset Management was announced in 2017. Mr Skeoch is now sole chief executive, with Mr Gilbert now vice chairman, focused on strategic relationships.

SLA kept the interim dividend unchanged at 7.3p. Shares closed down 21.2p at 260.6p.