Ashmore’s H1 2026: PBT up 64% as flows return and EM outperformance kicks in
Ashmore Group has put in a punchy first half to 31 December 2025. Assets under management (AuM) rose 10% to US$52.5 billion on the back of net inflows of US$2.3 billion and positive investment performance of US$2.6 billion. Profit before tax jumped 64% to £81.9 million and diluted EPS nearly doubled to 10.1 pence.
There’s important nuance under the bonnet. Adjusted net revenue fell 16% year-on-year to £67.5 million and adjusted EBITDA was down 38% to £20.9 million. The gulf between statutory and adjusted results is mainly seed capital gains – strong, but not guaranteed every half. Still, the direction of travel in flows and performance is encouraging.
Key numbers investors should know
| Metric | H1 2026 result | YoY/Notes |
|---|---|---|
| AuM (period end) | US$52.5bn | +10% over the period |
| Net flows | US$2.3bn | H1 2025: US$1.1bn outflow |
| Performance impact on AuM | US$2.6bn | Positive markets and outperformance |
| Adjusted net revenue | £67.5m | -16% YoY |
| Adjusted EBITDA (margin) | £20.9m (31%) | H1 2025 margin: 42% |
| Profit before tax | £81.9m | +64% YoY |
| Diluted EPS | 10.1p | +89% YoY |
| Adjusted diluted EPS | 3.1p | -35% YoY |
| Interim dividend | 4.8p per share | Unchanged; 47% of diluted EPS |
| Net management fee margin | 34 bps | Basis points; H1 2025: 36 bps |
| Performance fees | £0.8m | Lower vs prior year |
| Cash and deposits | £277.3m | £261.1m excluding consolidated funds |
| Excess financial resources | £480.3m | Strong, liquid balance sheet |
Flows are back: where the money moved
Subscriptions of US$5.7 billion were up 39% year-on-year, while redemptions fell 35% to US$3.4 billion – the lowest half-year redemption level since 2011. That’s a clear turn from last year’s outflows and suggests allocators are rebuilding Emerging Markets (EM) exposure.
By theme, fixed income saw net inflows of US$1.6 billion, equities US$0.6 billion, and alternatives US$0.1 billion. Equities AuM rose 17% to US$8.8 billion, while local office AuM grew 8% to US$8.4 billion with strong contributions from Indonesia and Colombia. Notably, 39% of Group AuM is now sourced from EM-domiciled clients – a useful diversification of the client base.
Performance tailwinds: EM outpaced developed markets
EM indices posted between +5% and +8% in fixed income and +15% to +21% in equities over the half, beating global bonds at +1% and world equities at +10%. Ashmore’s active processes did the job: 82% of AuM outperformed over one year, 70% over three, and 58% over five.
In fixed income, spreads tightened meaningfully, and yields remain attractive (e.g. EMBI GD at 6.8%). In local markets, high real yields and a weaker US dollar supported returns. EM equities saw broad-based earnings growth, particularly in technology and across China, India, South Africa, Mexico, Colombia and Chile.
Earnings quality: what’s driving that 64% PBT jump
Let’s demystify the drivers. Profit before tax rose to £81.9 million, helped materially by seed capital gains of £55.4 million. Seed capital is the firm’s own money invested in its funds to launch or scale products; in a strong market, those positions can post chunky gains.
Strip out seed and FX translation, and adjusted PBT was £26.2 million versus £44.1 million last year. Similarly, adjusted diluted EPS fell to 3.1 pence from 4.8 pence. The underlying revenue picture reflects lower average AuM and much lower performance fees (£0.8 million).
Fees, margins and costs
- Net management fee margin was 34 bps (basis points; one basis point is 0.01%), down from 36 bps in H1 2025 but stable on recent run-rate.
- Adjusted net revenue declined 16%, mainly due to lower averages and performance fees.
- Costs were well controlled: adjusted operating costs rose just 1% YoY, with variable compensation accrued at 32.5% of EBVCT.
- Adjusted EBITDA margin of 31% remains healthy, if lower than last year’s 42%.
Balance sheet strength and dividend
Ashmore ended the period with total cash and deposits of £277.3 million (£261.1 million excluding consolidated funds), and £480.3 million of excess financial resources over regulatory requirements. Equity attributable to shareholders was £771.8 million.
The Board kept the interim dividend at 4.8 pence per share, payable on 30 March 2026. With liquidity strong and cash generation positive, the payout looks well covered, albeit boosted by non-recurring seed gains this half.
Strategy in action: diversification and local platforms
Diversification is moving the needle. Equities AuM is now US$8.8 billion (17% of Group AuM), while local offices account for US$8.4 billion (16%). Indonesia grew AuM 41% to US$2.0 billion, Colombia rose 16% to US$2.5 billion, and India held steady at US$2.3 billion after strong FY2025 growth.
Alternatives continue to build quietly, with new commitments of £74.3 million in the period focused on thematic private equity in healthcare and other sectors across Latin America and the Middle East.
Why this matters for shareholders
- Momentum has turned: Broad-based net inflows, reduced redemptions and consistent outperformance are the key ingredients for a fee income recovery.
- Underlying revenue still soft: Adjusted net revenue and EBITDA fell, with fee margins a touch lower and performance fees minimal. The quality of earnings will matter in future halves.
- Seed capital a double-edged sword: It amplified profits this time; it can swing the other way if markets wobble. Adjusted metrics tell the steadier story.
- Diversification on track: More equities, local platforms and EM-sourced clients should smooth cyclicality over time and broaden distribution.
Outlook: supportive EM setup, active management crucial
Management highlights a supportive backdrop: higher EM growth, disinflation giving room for policy easing, and likely US dollar weakness. Emerging Markets continue to trade at discounts to the US, with strong earnings expectations into 2026.
Geopolitics and elections (notably in Latin America) add complexity, which plays to active managers. The company’s stance is clear: the breadth of EM opportunities and Ashmore’s specialism position it to capture flows and performance if the macro tailwinds persist.
Jargon buster
- AuM: Assets under management – the total client money managed.
- EBITDA: Earnings before interest, tax, depreciation and amortisation – a proxy for operating cash profits.
- Basis points (bps): 1/100th of a percent. 34 bps = 0.34%.
- Seed capital: Ashmore’s own capital invested into its funds to launch/scale products; gains and losses flow through earnings.
- Performance fees: Fees earned when funds beat predefined benchmarks over set periods.
What I’m watching next
- Sustained net inflows across fixed income and equities, especially from US allocators if US rates ease.
- Net management fee margin stability around 34 bps, or signs of uplift as mix improves.
- Recovery in performance fees from eligible AuM (c. US$8 billion).
- Adjusted EBITDA margin progression back toward mid-30s as average AuM rises.
- Seed capital volatility – helpful this half, but not a given.
My take
This is a good reset half from Ashmore. Flows have turned positive, performance is doing the heavy lifting, and the balance sheet is robust. The big caveat is that the eye-catching profit growth is flattered by seed gains; the underlying fee engine still has catching up to do.
If EM tailwinds persist and client allocations continue to rebalance away from the US, Ashmore’s specialist platform should benefit. For now, I’d mark this as a positive inflection with work to do on recurring revenues – exactly the kind of setup long-term investors in EM managers look for.
