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NexGen Financial AUM up two per cent year-on-year


NexGen Financial Corporation has reported an increase in assets under management (AUM) of two per cent to USD965.2m as at 30 June 2013, from USD947.5m at 30 June, 2012.

Net sales were negative USD32.2m and AUM declined six per cent for the second quarter of 2013, while management and administration fee revenues were USD3.5m for the second quarter of 2013, a 7.7 per cent increase from USD3.2m for the second quarter of 2012.
Operating EBITDA improved to USD0.32m (USD0.07 per share) for the second quarter of 2013, from USD0.20m (USD0.04 per share) for the second quarter of 2012.
NexGen reported a net loss of USD0.28m (USD0.06 per share) for the three months ended 30 June 2013, compared with a net loss of USD0.27m (USD0.06 per share) for the same period in the prior year.
"We remain focused on broadening our product suite to appeal to a broader range of investors. NexGen’s new US Dividend Plus Funds launched in January 2013 and sub advised by Ziegler Lotsoff of Chicago had assets of USD37m as at 30 June,” says Laurie Munro, president and CEO of NexGen.
Industry wide assets continued to rotate out of fixed income into more aggressive asset classes. NexGen, like other fixed income focused asset managers, has felt the impact of this move with negative net sales during the quarter.
"In response to this industry trend, NexGen has recently launched two new funds. The first being a Canadian Preferred Share Fund to be sub-advised by J Zechner Associates and the second being a Global Equity Fund to be sub-advised by Toron AMI International Asset Management. We believe more, better performing income and equity products will be the key to rekindling asset growth.” says Munro.
"In the interim, until the anticipated sales momentum rebuilds, management has initiated a cost reduction programme that targets USD50,000 a month by 1 October, 2013. Cost reductions will be achieved through increased operating efficiencies and a reduction in headcount,” he adds.

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