Aberdeen FY 2025: profit up, momentum building, and interactive investor steals the show
Aberdeen Group has posted a tidy set of full year numbers for 2025. Adjusted operating profit rose 4% to £264m, driven mainly by a standout performance from interactive investor (the Group’s direct-to-consumer platform, often shortened to “ii”). IFRS profit before tax jumped 76% to £442m, helped by investment gains on its stake in Standard Life plc.
Assets under management and administration (AUMA) climbed 9% to £556.0bn, largely thanks to positive markets. Flow picture is improving beneath the surface, but not yet fixed: total net flows were £(3.9)bn, though excluding liquidity funds the outflow narrowed to £(1.7)bn, a sharp improvement on 2024.
| Headline metric | 2025 | 2024 | Change |
|---|---|---|---|
| Adjusted operating profit | £264m | £255m | +4% |
| IFRS profit before tax | £442m | £251m | +76% |
| Adjusted diluted EPS | 15.7p | 15.0p | +5% |
| Dividend per share | 14.6p | 14.6p | Unchanged |
| AUMA | £556.0bn | £511.4bn | +9% |
| Net capital generation | £239m | £238m | Flat |
| 3-year investment performance | 80% | 60% | +20 ppts |
Jargon decoder for retail investors: AUMA is the total pile of assets Aberdeen runs or administers. Basis points (bps) are hundredths of a percent. CET1 and total capital coverage refer to regulatory buffers. Net capital generation is the cash-like capital created after running the business and absorbing required costs.
Segment performance: where the growth came from
interactive investor: record inflows and fatter profits
- Adjusted operating profit up 34% to £155m.
- Adjusted net operating revenue up 19% to £330m, with trading revenue +44% and treasury income +17%.
- AUMA £97.5bn, up from £77.5bn.
- Record net inflows £7.3bn, with total customers up 14% to 500k and SIPP customers up 30% to 104.5k.
- Cost/AUMA ratio improved to 18bps from 19bps.
This is the growth engine. Higher customer engagement, strong DARTs at 26.6k per day, and a scalable cost base are doing the heavy lifting. Management guides that FY 2026 revenue will grow in subscriptions and treasury income, partly offset by lower FX and trading fees. Cash margin is expected at 210-220bps versus 221bps in 2025. Still very healthy.
Adviser: repricing pain now, growth later
- Adjusted operating profit fell to £86m from £126m as the 2025 repricing flowed through.
- Adjusted net operating revenue down 14% to £205m; revenue yield 26.6bps vs 31.2bps, with c.3bps impact from repricing.
- AUMA rose to £80.4bn on markets, while net outflows improved 44% to £2.2bn.
- Treasury income slipped 9% as the average cash margin eased to 251bps from 263bps.
The strategic price cut was intended to sharpen competitiveness. It worked on flows, but it clipped revenue and profit. The business now expects a return to positive net flows in 2026, with a £1bn net inflow target in 2027. For 2026, revenue margin is forecast at 25-26bps and expenses will reflect the end of a temporary outsourcing discount.
Investments: leaner, better performance, mixed flows
- Adjusted operating profit up 5% to £64m as expenses fell 8% to £675m, offsetting a 7% revenue decline to £739m.
- Revenue yield dropped to 19.2bps from 21.3bps, reflecting asset mix.
- I&RW net outflows £2.1bn, but excluding liquidity there was a £0.1bn net inflow, a big improvement from a £4.7bn outflow in 2024.
- Insurance Partners saw £6.8bn net outflows, reflecting heritage business in run-off.
- 3-year investment performance improved to 80% of AUM outperforming.
Cost discipline is clearly biting in the right way. The improvement in performance and I&RW ex-liquidity flows is encouraging. The drag from Insurance Partners will persist. For 2026, Aberdeen guides to a revenue margin of around 19bps with further efficiency benefits, partly offset by investment and inflation.
Capital, cash and dividend: buffers beefed up
- Transformation now at £180m annualised cost savings, beating the £150m target.
- CET1 coverage up to 163% and total capital coverage to 218%, helped by approval to use the Group’s internal capital assessment, which reduced capital requirements by about £0.2bn.
- Adjusted capital generation up 5% to £323m; net capital generation slightly higher at £239m.
- Dividend held at 14.6p per share. Policy is to maintain 14.6p until covered at least 1.5x by adjusted capital generation. 2025 cover was 1.24x.
One important moving part: funding defined contribution payments from the DB pension surplus is expected to contribute about £35m in 2026, with restructuring and transaction costs materially lower than 2025. Note that the big IFRS profit jump also reflects a £236m gain from the Standard Life stake. Good to see, but not a recurring operating driver.
2026 guidance and watch list
- Group targets for FY 2026 reaffirmed: adjusted operating profit of at least £300m and net capital generation of around £300m.
- Medium-term aim to grow net capital generation 5-10% per year once the 2026 target is met, absent major market shocks.
- Total capital operating ratio targeted at 140-180% over the medium term.
- ii expects growth in subscriptions and treasury income, partially offset by lower FX and trading fees; cash margin guidance 210-220bps.
- Adviser revenue margin expected at 25-26bps; positive net flows now pushed to 2026, with £1bn target in 2027.
- Investments revenue margin c.19bps with ongoing investment performance improvements and cost discipline.
My take: why this matters for shareholders
The good news
- ii is delivering textbook platform economics: strong customer growth, rising assets, higher activity, and improving efficiency. That 34% profit rise to £155m is the core of the story.
- Group-wide cost transformation is real, with £180m annualised savings and lower non-staff costs. That gives room to invest while protecting margins.
- Capital position is stronger with CET1 at 163% and total coverage at 218%. The dividend looks sensibly maintained while cover improves.
- Investment performance has recovered to 80% on a 3-year view, which is a leading indicator for better flows in active asset management.
The watch-outs
- Group net flows are still negative, and Insurance Partners will remain a structural outflow as heritage books run off.
- Adviser profitability has stepped down and the timeline to positive flows has slipped to 2026. Revenue yield compression is visible.
- Part of the IFRS profit surge came from the Standard Life stake. Helpful, but market-sensitive and not operational.
- Revenue pressure from asset mix is ongoing in Investments, keeping yields below prior levels.
Net-net, I view this as a solid year of execution. The mix is becoming more attractive as ii grows into a larger share of Group profits, and the balance sheet is sturdier. If management hits the 2026 targets and Adviser swings back into net inflows on the new pricing and service gains, the investment case strengthens further.
Division scorecard: quick reference
| interactive investor | Adviser | Investments (Total) | |
|---|---|---|---|
| Adjusted operating profit | £155m | £86m | £64m |
| Adjusted net operating revenue | £330m | £205m | £739m |
| Adjusted operating expenses | £175m | £119m | £675m |
| AUMA/AUM | £97.5bn | £80.4bn | £390.4bn |
| Net flows | £7.3bn | £(2.2)bn | £(8.9)bn |
| Revenue yield | Cost/AUMA 18bps | 26.6bps | 19.2bps |
Bottom line
Aberdeen is getting simpler, cheaper to run, and more weighted to a high-growth retail platform with strong unit economics. That is exactly the strategic direction the market has asked for. There are still moving pieces on flows and margins in Adviser and Investments, but the 2026 roadmap is clear and capital strength buys time. If ii keeps compounding and the flow picture normalises, 2026 could be the year the Group’s earnings and cash generation step up meaningfully.
