The IOOF Holdings Limited (ASX: IFL) share price will be one to watch this morning.
This follows the release of the financial services company's second quarter update.
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How is IOOF performing?
It was an eventful second quarter for IOOF, with Funds Under Management, Advice and Administration (FUMA) falling $0.4 billion to $202.4 billion at the end of December.
Management advised that this reflects an uplift of $12.7 billion in FUMA due to market movements, which was offset largely by one-off negative movements of $10 billion.
These negative movements include $8.1 billion from the termination of the BT relationship, $1.5 billion from the liquidation of IOOF's Cash Management Fund, and a $0.4 billion one-off transfer from the Cash Management Trust.
IOOF's Chief Executive Officer, Renato Mota, also revealed that the company was impacted by the Early Release of Super (ERS).
He said: "This quarter has seen ongoing impacts of ERS, especially the final opportunity for early access. As well, we have experienced the ongoing impacts of COVID, including client concern and uncertainly around ongoing and potential economic impacts. Our ClientFirst approach has been invaluable in ensuring that our clients have the support that they need during times of significant uncertainty."
Nevertheless, the strong market performance helped offset much of this to leave its FUMA down only slightly for the three months.
"There has been strong market performance over the quarter and as a result of the scale and diversity of our business, the market contribution of $12.7 billion to FUMA has largely offset outflows."
Mr Moto was also pleased with the progress the company is making with its transformation plans.
He commented: "We are making good progress towards the transformation of the business. In particular, we are transforming the advice business through our Advice 2.0 strategy and progressing our platform simplification strategy, while supporting IOOF's open architecture approach and enabling choice for our clients."
The Chief Executive is now looking ahead to the middle of the year when its FUMA should be boosted by the acquisition of the MLC business from National Australia Bank (ASX: NAB).
"We have continued to meet key milestones in the execution of our transformation program including Advice 2.0 and Evolve. We are progressing well and meeting targets to enable the completion of the proposed MLC acquisition before 30 June 2021," he added.
No guidance has been given in respect to first half profits or its expectations for the full year.
