Man Group Aktie

Good morning, everyone, and thank you for joining us today. I'm Robyn Grew, the CEO of Man Group, and I'm joined by our CFO, Antoine Forterre. I'll begin with a high-level overview of our investment performance and client engagement in 2025. Antoine will then walk you through the financial results, after which I'll update you on our multiyear priorities now 2 years on from when we first announced our strategy before providing longer-term context on the evolution and positioning of our business.

2025 was a year of pronounced peaks and troughs for markets where periods of volatility tested investor resolve before conditions eventually stabilized. We navigated shifting sentiment, and at times, unprecedented reversals, absorbing shocks from DeepSeek in January, tariff announcements in April, ongoing geopolitical tensions and debate over the sustainability of fiscal spending and AI infrastructure investment.

Markets demonstrated a remarkable capacity to withstand stress, though the path was far from smooth. Given this environment, I'm pleased to report a set of results that shows just how resilient Man Group is. Antoine will go into more detail later, but I'll start with some headlines.

Firstly, I'm delighted that we ended the year with AUM of $228 billion, driven by $21.4 billion of positive investment performance and $28.7 billion of net inflows. Through continued cost and capital discipline, we generated core earnings per share of $0.276. Along with this, we also executed against our strategic priorities, completing the Bardin Hill acquisition, simplifying our operating model and positioning the firm for long-term growth. These results underscore the continued demand for our differentiated offering, the depth of our client relationships, and crucially, the value of the diversified business we have built.

On the topic of diversification, the benefits of having a diversified range of investment content were highlighted clearly in 2025. The first half of the year was undoubtedly testing for trend following strategies, continuing the run of underwhelming performance that began in Q2 of 2024. The reversal of the Trump trade in Q1, combined with the administration stop-start approach to tariffs, created whipsawing market conditions where sustained trends were incredibly hard to find. However, investor sentiment moved on from the lows of early April, and August proved to be the inflection point.

As risk on sentiment took hold, several trends finally began to emerge and persist. Our strategy has adjusted positioning to capture these moves, delivering strong gains into year-end. In that context, it was great to see AHL Alpha and AHL Evolution finish the year up around 5%. The strength we saw across our strategic priorities enabled the firm as a whole to successfully navigate the significant period of stress for trend following.

The results from a numeric range were particularly impressive. Over the past 3 years, these strategies have delivered returns averaging 4% over their respective benchmarks. Our liquid credit strategies also continued their strong run of outperformance, while our multistrat Man 1783 once again delivered outstanding returns. By dynamically allocating across our full range of uncorrelated strategies, it has delivered consistent, high-quality performance since launch in 2020.

On an asset-weighted basis, relative investment performance was positive overall in 2025, driven primarily by our long-only strategies. Within alternatives, the overall relative underperformance was largely attributable to AHL Evolution's performance earlier in the year, which trades harder to access markets and differs significantly from the traditional trend followers in the index.

Turning to clients. We prioritized being present with our clients in 2025, holding over 16,000 meetings to understand their evolving needs and help them navigate a complex environment. That focus drove exceptional client-led growth during the year. We delivered record gross and net inflows, nearly 20% ahead of the industry. We've taken market share for the sixth consecutive year, a very strong outcome in the context of a challenging fundraising environment.

As you can see from the chart on the left, the strength was broad-based. It is well known that large allocators are seeking to do more with fewer managers, consolidating relationships around true strategic partnerships. That trend plays to our strengths, and the numbers reflect that. It was also a record year for new client additions with 36% of gross sales coming from relationships entirely new to the firm, while our top 50 clients remain invested in more than 4 strategies on average.

Whether I'm speaking with a pension fund in North America or a sovereign wealth fund in the Middle East, the feedback I receive is clear. Our clients face increasingly complex challenges that require tailored solutions. With a broad range of uncorrelated strategies delivered through a technology-powered platform, we have the capability and the scale to meet that demand. From customized risk levels and access to new asset classes to the launch of new product structures, we are adapting to how our clients want to work with us. That agility is a competitive advantage.

And now I'll hand over to Antoine, who will take you through the numbers.

Thank you, Robyn, and good morning, everyone. I'll begin with last year's financial highlights before providing further details on our AUM, P&L and balance sheet. As Robyn mentioned, we ended the year with AUM of $227.6 billion, up nearly $60 billion since the end of 2024. The increase was driven by positive investment performance of $21.4 billion and record net flows of $28.7 billion. On a relative basis, our net flows remained ahead of the industry for the sixth consecutive year with our sustained growth in market share further validating the relevance of our offering to clients.

In 2025, we recorded net revenue of almost $1.4 billion, including performance fees of $281 million, mostly from non-AHL strategies. This demonstrates the progress we have made in diversifying our mix of revenue and performance fee generation in particular. We also recorded $38 million in investment gains.

Fixed cash costs of $430 million reflect the actions we took earlier in the year to maintain cost discipline and to better align resources towards our strategic priorities. At 48%, the compensation ratio was within our guided range, reflecting lower net revenues in the year. As a result, core profit before tax was $407 million with $294 million of core management fee profit before tax, which equates to $0.196 of core management fee EPS.

Lastly, we are proposing a final dividend of $0.115 per share, taking the total dividend for the year to $0.172 in line with 2024. We continue to maintain a strong and liquid balance sheet with net tangible assets of $723 million as at the end of December, supporting our disciplined capital allocation policy. Our overall asset-weighted relative investment outperformance was 1.3% compared to 1% in 2024. Investment performance was positive across all product categories with long-only strategies delivering particularly strong results.

Our long-only offering contributed $34.5 billion in net flows, serving as a powerful endorsement of our differentiated proposition in this space. While alternative strategies faced some headwinds due to the poor performance from trend following strategies in the first half, engagement on liquid alternative, and crisis Sapphire remains robust as we head into 2026, reinforcing the continued relevance of our uncorrelated content.

Other movements were $8.9 billion. This includes $6.7 billion of FX tailwinds owing to a weaker U.S. dollar as a significant proportion of our AUM is denominated in other currencies and $2.7 billion from the acquisition of Bardin Hill. Finally, in addition to fee-paying AUM, we also ended the year with $4.9 billion of uncalled committed capital, which provides a strong foundation for future AUM growth across our private markets business.

Before moving on from AUM, I wanted to spend a moment on the new reporting categories we're introducing this year. This updated categorization, which you can see on the slide, reflects the growth and evolution of our business, provides greater transparency on our strategic priorities, such as credit, and aligns more closely with market practice to improve comparability with peers.

As you'd expect, there is no material change at the long-only and alternative category level. We have simply reclassified the subcategories to make them easier to understand. More details, including information on fee margins, can be found in the investor data pack on our website. We will continue to provide the previous categorization in our materials up to Q3 of this year to ensure a smooth transition. And of course, we are available to answer any questions you might have.

Our run-rate net management fees, which represent a point-in-time snapshot of the firm's management fee earning potential increased to $1.182 billion at end of December 2025 from $1.058 billion at the end of 2024. This was driven by the significantly higher AUM at the end of the year and the strong recovery in trend-following performance in the second half. This is the highest level in more than 10 years. The run-rate net management fee margin decreased from 63 basis points at the end of 2024 to 52 basis points at the end of '25, reflecting the shift in underlying AUM towards long-only strategies during the year. As I have emphasized many times before, we did not target a particular net management fee margin, but instead prioritized driving profitable growth across all our product categories.

Moving on to performance fees. In a year where trend-following strategies struggled before recovering in the second half, core performance fees were $281 million compared with $310 million in 2024. This is a strong reflection of the progress we have made in diversifying our business and its performance fee earnings potential. It underscores our ability to deliver strong outcomes for our shareholders even in years of below average contribution from trend following.

At the end of December 2025, we had $59.6 billion of performance fee eligible AUM, of which $36.6 billion was at high watermark compared to $21.1 billion at the beginning of the year. A further $17.4 billion was within 5%. An often overlooked feature of our business is a $13 billion of AUM from the long-only category is performance fee eligible, increasing our performance fee earning potential while providing valuable diversification.

This slide provides further insight into how performance fee earnings potential has changed over time. If you have followed us for a while, you might recall a similar slide at our Investor Day in 2022. The dark blue line plots the distribution of a Monte Carlo simulation of the next 12 months' performance fee outcomes based on distances from our watermark, expected returns and volatility assumptions for our key performance fee-paying funds as at December 2025.

The median simulated performance fee outcome for 2026 is $471 million. This is a 35% increase from $349 million at the end of December '21 and nearly 3x what we expected in December 2016. This improvement predominantly reflects the growth in performance fee eligible AUM and the progress we have made diversifying the underlying range of strategies that contribute to our performance fee earnings.

As of the 20th of this month, we had accrued approximately $350 million of performance fees due to crystallize in 2026. As always, this figure is not a forecast or guidance, but rather the position at a specific point in time. The amounts that crystallize will fluctuate increasing or decreasing based on investment performance up to crystallization dates.

Moving on to costs. Fixed cash costs of $430 million were 5% higher compared with 2024. This includes a $16 million impact due to the strengthening of sterling against the U.S. dollar and another $4 million from the Bardin Hill acquisition. These increases were partially offset by the cost control actions we took earlier in the year, as reflected in the decrease in headcount. The overall compensation ratio increased marginally to 48%, reflecting the decrease in management and performance fee revenue during the year. However, the recovery in trend-following performance in the second half meant that we were able to remain below the upper end of our guided range.

From 2026, we will be changing the modeling framework, moving away from the fixed cash costs and comp ratio guidance to a core PBT margin range. Our previous guidance was established in 2013 during a period of significant restructuring when the business looked materially different. This approach, which focuses on a few specific line items within our P&L without allowing for fungibility of spend, is no longer fit for purpose. Our operating model has evolved and technology is ever more central to our business.

Going forward, we will manage the business to a core PBT margin, typically between 30% and 40%, varying based on the quantum and mix of revenue. It may be outside this range in years with particularly high or low core performance fees as it has been in recent past in both directions. This range is calibrated around the average realized core PBT margin of 35% between 2020 and 2025. This change provides greater operational flexibility, which is critical to remaining agile given the pace of change. It should not change the way you think about and model the overall profitability of the business.

Importantly, it also does not alter our commitment to cost and capital discipline or remove the ability to benefit from significant operating leverage in exceptional performance fee years. Core net management fee earnings per share were $0.196, 9% lower than 2024, while performance fee earnings per share decreased to $0.08, down from $0.106 in 2024. Total core earnings per share were $0.276.

In summary, despite the challenging market conditions for trend following in the first half, 2025 was another year of resilient earnings for the firm. We continue to maintain a strong and liquid balance sheet, which gives us optionality and flexibility to pursue our long-term growth ambitions and return capital to shareholders. At the end of December, we had $723 million of net tangible assets, including $173 million in cash and cash equivalents.

Our seed capital program continues to play an integral role in supporting the growth of our business. In 2025, we seeded 12 new strategies, including new private credit strategies and active ETFs in line with our strategic priorities. Gross seed investments at the end of December were $603 million. The portfolio remains well diversified across strategies and markets. This brings me to capital allocation.

Our policy remains disciplined and intends to support the future growth of the business while delivering attractive returns to shareholders. It follows a clear waterfall with 4 categories. First, we aim to increase the annual dividend per share progressively over time, reflecting the firm's underlying earnings growth and free cash flow generation. In 2025, dividends to shareholders totaled approximately $200 million.

Second, we deploy capital to support product development and technological innovation. We continue to actively manage our seed book considering the opportunities available. And in 2025, we redeployed $400 million of seed capital. We also continue to invest heavily in technology to ensure we remain at the forefront. Third, we evaluate M&A opportunities that align with our strategic priorities. In 2025, we completed the acquisition of Bardin Hill, bolting on opportunistic credit and performing loans capabilities to our credit business.

Finally, any remaining available capital is returned over time through share buybacks. Last year, we repurchased $100 million of our share capital at an average price of 182p. Including the proposed final dividend and the $100 million share buyback I just mentioned, we returned approximately $300 million to shareholders in the year. Over the past 5 years, the total capital returned to shareholders via dividends and buybacks is $1.8 billion, over 50% of our market cap as of the end of December. Shareholders now receive an additional 23% of every dollar of earnings when compared with 2021.

On that note, I'll hand over to Robyn to take you through the next section of the presentation.

Thanks, Antoine. 2025 tested us at times, but we navigated the challenges to emerge stronger and finished the year with real momentum. That is a powerful validation of our strategy. We were able to deliver a resilient set of results because the diversification we have built over recent years is delivering. In a year where trend-following faced significant headwinds, it was the strength in quant equity, liquid credit and solutions on the investment side, combined with strong growth across client channels and geographies that delivered for us. That is our strategy working as intended.

The benefits of diversification are clear, and this slide illustrates why. The capabilities we have scaled have near 0 or even negative correlation with trend following. The more high-quality uncorrelated content we offer, the more relevant and valuable we are as a strategic partner to clients. That relevance drives growth. And as you can see on the chart in the middle of the slide, the business today looks very different from just 4 years ago, both in terms of scale and business mix. That shift also matters for earnings. Not only does it grow and strengthen our management fee stream, but as Antoine mentioned earlier, it also improves our performance fee earnings potential.

Non-AHL performance fees have grown significantly from $116 million in 2021 to $225 million in 2025. Diversification has reduced our reliance on any single investment strategy and has increased the stability of our overall earnings, providing new options for growth that ultimately drive value creation for shareholders. The strategy we outlined 2 years ago will enable us to continue to deliver this diversification.

As many of you will recall, we outlined 3 priorities at our full-year results 2 years ago. They were to diversify our investment capabilities, to extend our reach with clients around the globe and to leverage our strength in talent and technology, all while continuing to invest in the core of our business. We set ambitious goals to drive the next chapter of growth for Man Group. Now, more than ever, we have conviction that we are targeting the right areas. Although not every initiative moves at the same pace, the prevailing trends in our industry remain largely unchanged. Client engagement is the strongest it's ever been, and we have good momentum across several pillars of our strategy.

Let me take you through the progress we've made in more detail. Starting with our investment capabilities. Our credit platform continues to go from strength to strength. We now manage $53.1 billion across the liquid and private credit spectrum, up from $28.3 billion just 2 years ago. Organic growth in liquid credit has been exceptional with strong client demand for our high-yield and investment-grade strategies in particular. We also completed the acquisition of Bardin Hill in October, which adds opportunistic credit to our existing private credit offering and strengthens our CLO capabilities. I'm very pleased with where we stand. We are now a broad-based partner across the credit space.

On quant equity, it was pleasing to see our long-only strategies had an exceptional year, growing AUM by 97% and continuing our track record of alpha generation. Alongside strong performance, it is the ability to offer a high degree of customization at scale that is also proving hugely valuable to clients. Mid-frequency is a complex space that requires significant investment in research and infrastructure, and there's a lot of work going on behind the scenes. We've developed 2 distinct strategies that take different approaches to idiosyncratic alpha generation, factor exposure, geographical focus and holding periods.

Notably, our quant alpha capability delivered 21.3% net performance in 2025, which offers clear evidence of our progress in this high potential space. We continue to deliver complex solutions to help our clients solve their most significant challenges. That remains a real differentiator for us. More recently, our advisory offering in partnership with the Oxford-Man Institute has been in strong demand as we partner with clients to deliver thought leadership that helps them to navigate issues they face across their portfolios. A great example of this is the work we've done on timing the market in collaboration with one of our Nordic clients. The agility we have shown in adapting to client needs has served us well, and that will not change.

Finally, I spoke about Man 1783 earlier today. After another strong year in 2025, we've delivered 10.5% net annualized performance over the last 3 years for our clients. That is a track record that puts us up there with the best in this space. We are continuously improving our investment processes, knowing that innovation is not just about launching the next flagship product, it's about making everything we do better every single day.

We've also made strong progress extending our client reach, targeting the regions and channels where we are underweight relative to the size of the opportunity. North America is a great example of that. I'm delighted that we have nearly doubled annual gross flows from North America in 2 years, from $10 billion to nearly $20 billion. Growing our presence in the institutional channel has been a particular highlight with a 24% increase in North American pension plan clients. Given the sheer scale of that market, we see a significant runway for growth.

In Wealth, we've seen a similar trajectory. We are bringing institutional quality liquid products to one of the fastest-growing segments in asset management, and the opportunity here is large. To strengthen our offering, we launched 4 active ETFs across discretionary and systematic styles in equity and public credit last year. Our strategic partnerships continue to deliver strong growth. The Asteria joint venture is a great example of that, where appetite for our credit products has been particularly strong.

Finally, on insurance, I'm sure many of you are aware that this is a complex area that requires careful groundwork. We have laid those foundations globally, and our strategic partnership with Meiji Yasuda is an encouraging early step. Discussions with prospects continue, though it remains contingent on the ongoing build-out of our overall credit capabilities.

Our third priority is to continue leveraging our strengths in talent and technology, both of which are underpinned by the culture of constant improvement that runs through our DNA. We're always looking ahead, positioning the business for future growth. A good example of this is the change we made last year in Systematic, bringing AHL and Numeric together under one division to drive innovation, product co-development and research collaboration. We approach technology with the same mindset. And as a result, we're not just keeping pace with change, we're leading it.

We made significant advances in AI during the year, developing over 100 plug-ins across the firm using a range of AI platforms. For us, this isn't a peripheral initiative. It is truly embedded across our entire organization. And it's one of the reasons Anthropic has chosen to partner with us on the design and application of AI in investment management. I think that tells you something about where we stand. Our ambition is clear to become an AI-powered asset manager. We have the heritage, the expertise and the data to make that a reality. So across all 3 pillars, investment capabilities, client reach and talent and technology, we have made meaningful progress. The strategy is delivering, and the results speak for themselves.

We entered this year in great shape and with good momentum. Our $87 billion liquid alternative business gives us a platform with an exceptional long-term track record of delivering for clients and shareholders. In an environment where clients are increasingly focused on uncorrelated returns, liquidity and crisis alpha, the relevance of that platform has never been greater. Alongside that, we now manage $17 billion in private credit with teams focused on underwriting discipline and the ability to capture dislocation when it arises. Our long-only business has scale, a clearly differentiated proposition and a proven ability to generate alpha.

And finally, we've aligned resources with our strategic priorities, ensured cost and capital discipline and position the business for long-term success. The result is a firm with its highest run rate net management fees in over a decade and near record performance fee optionality. I feel very good about how we have started the year and our ability to capture the opportunities that lie ahead. It is not just our business that is well positioned, the market environment is supportive, too.

After a decade defined by U.S. exceptionalism, we are seeing a more complex, dispersed landscape emerge. That is exactly the environment in which active management thrives and allocators are responding. The chart in the middle shows their plans for 2026, which favor many of the strategies where we have strength, hedge funds, portable alpha, active extension. Our ability to help clients navigate this environment with a broad range of alpha-focused strategies has never been more relevant.

At the same time, demand for customization continues to grow. Capital allocated via customized structures has increased 61% since 2023, reflecting a clear shift towards strategic partnerships and tailored solutions. You've heard me talking about our strengths in that space time and time again. It is where we have a clear competitive advantage.

So to close, 2025 tested us and our strategy delivered. Record inflows, AUM at all-time highs and a resilient set of earnings in a year that was far from straightforward. The diversification we have built proved its worth. I'm incredibly proud of what this team has achieved. None of this is possible without the exceptional talent across our firm. Their energy and commitment are what set us apart. We enter 2026 as a more diversified, structurally stronger business that is well positioned for growth.

The landscape is shifting in our favor. Markets are more dispersed, allocators are demanding more from fewer partners and the value of our offering has rarely been clearer. We have the investment content, we have the client relationships and the technology platform to capture that opportunity. And I have absolute conviction that our strategy will deliver long-term value for our clients and our shareholders.

With that, we'll open up for analyst Q&A.

As a reminder, to ask a question, you need to have joined the presentation via the Webex link. Press the Raise Hand button and please unmute yourself when we can call your name. Thank you.

Thank you, Robyn. And we'll start with Nicholas. I'm going to send a request, and you should be able to unmute.

Can you hear me?

Yes, Nicholas.

Three questions from my side, if I may, please. One on AI one on absolute return and one on capital return. So on AI, I think the Anthropic partnership is super interesting. I appreciate it's early days, but do you have any ambitions or key milestones you can share with us from that partnership?

And I guess just more broadly, if we think beyond yourselves, how do you expect AI to impact competition and alpha generation in the markets in which you operate? And which markets do you think could see the most significant impact, please? So that's the first one.

On absolute returns, I appreciate the strong delivery in diversifying the business for sure. But if I focus on absolute return, could you just give us a sense of investor sentiment and engagement there given the shift from underperformance to recovery, but there's still a negative relative performance? And are there any further redemptions in the pipeline we should be aware of?

And then finally, on capital return, I guess, following the repayment of the RCF, you have significant available net cash and equivalents. What was the rationale to keep the dividend stable and not declare any additional capital return? And should we see this as an indication of your M&A pipeline?

Right. Do you want to...

I will go ahead and start with the last one.

Yes.

Which is -- I'll start with the last one. So we have a clear, unchanged capital allocation policy, dividend first, which we aim to grow in line with earnings over the cycle. And if you look at earnings year-on-year, they were down, hence, keeping the dividend flat. Now, if you look over the last 5 years, we've increased the dividend, I think, to the tune of 10% per annum over that period. So we've delivered the growth over the cycle as intended with our policy.

And then, we aim to invest in the business, both organically and inorganically. If you look at last year, we deployed investments in technology, but also did an acquisition. And then after that, we look at returning capital by way of buyback, which we executed last year to the tune of $100 million, so we returned $300 million to shareholders last year in addition to doing an acquisition, a bolt-on acquisition in a year that didn't see us generate huge amount of capital given the slightly softer performance fees. So very much in line with our policy, we're keeping dividend flat.

Do not read anything into future M&A. The Board in due course will consider options and might return capital to shareholders as and when it sees fit.

I can take the absolute return one going reverse order if you want and you can do AI.

Yes, for sure. Yes.

So I would differentiate between trending following and the rest of offering. Trend following has indeed a soft -- let's be clear, a poor first half and then a tremendous recovery that extends into 2026. The rest of absolute return category, which I think is best represented by our Fund 73 performed well throughout. 73 was up in the first half and up in the second half to finish the year last year at 14%.

In terms of investor sentiment, the outflows we saw last year were prominently driven by the trend following category as well as some of the risk parity category. Both have had a strong second half and start of the year. And eventually, performance is what leads to flow. We don't comment on future flow, as you know. So I'm not going to give you specific comments, but I think you can read in the confidence that we have, the way that we think of ourselves starting '26 in a strong position and the belief that we have in our client relationship.

AI?

AI. Fair to say we're excited about the opportunity set. No specific milestones that we've set with Anthropic, but this is a partnership where we believe we can add to their understanding of what the needs are, but also drive the solutions that we can put in play across the organization, be they at the front end and the research capability that we can look at and develop more or indeed through the entirety of the AI capabilities you see for efficiencies and effectiveness through the rest of the organization.

For us, we've spent 35, 40 years being at the cutting edge of technology. This is no different. We believe we are in a terrific place to benefit from use, utilize and lead with some of the strongest players on the street, this extraordinary technology capability. So tremendously excited, no real milestones, but we think this partnership will help us, along with everything else we do, take full advantage of the full suite of technology.

With that, I'm going to go to Arnaud. Arnaud, you should get a request to unmute.

I've got 3 quick questions, please. Firstly, going back to the buyback. So historically, when you tend to come back into performance fee territory and in a good position, usually, that does correlate with buybacks. I'm just wondering, why there hasn't been -- and particularly, if I'm looking at the cash flow statement, I noticed a big outflow in terms of working capital. So maybe if you could give us a bit more color there and what your thinking is in terms of the buyback. I mean, the net financial assets did improve. So I would have expected some nonetheless.

Second question is on St. James's Place. There was some news flow around St. James reallocating mandate. I'm just wondering what was the quantum that might impact our flows and when that comes through?

And my third question is on management fee margins. The run rate management fee margin looking forward has reduced. Clearly, there's a bit of a mix shift between categories, and I understand that. I understand that you don't manage the business given management fee margin and all business is good. But I'm just wondering, if I isolate each category, are we seeing -- at constant mix, are we seeing dilution margins, is my question?

Yours, I think.

Yes, I'll take them in order, and thank you for the questions. Expand a bit on the buyback, performance fees is, obviously, one source of capital generation, and therefore, a correlation between performance fees and capital returns because it sort of follows a waterfall we outlined. I go back to what I mentioned earlier. Last year, we deployed $300 million of capital returning to shareholders plus an acquisition in a year where cash flow generation was still more subdued. There's a timing of cash flow point as well, and we start the year in a strong position. Do not read anything in that signal. We have not changed our capital policy. But at this point, the Board has not decided to announce a buyback.

St. James's Place, we don't comment on future flows. We have had in the past commented on very large flows in and out when we felt it was relevant, but we're not commenting on future flows. The outlook remains the one that you can read, and we've outlined.

And then, on management fee margin, we are seeing a mix shift both between categories and within categories. Between categories, we -- if you look at the year, we finished the year with a majority of our AUM on the long-only side, which is traditionally lower margin. I think 60% of our AUM is long-only. And that explains the overall the shift. Within categories, you're also seeing the same thing.

If I pause on the absolute return category, what we saw last year was a slight relative underperformance evolution, and then, worse flows in the evolution because of higher-margin product than the other content within that category. And that explains why within that category, you also saw margin erosion. We are not seeing any kind of fee pressure that we call out here. So it is really a mix effect at the category level and within the category level.

I'll go to David McCann.

Hope you can hear me.

Yes.

A couple of my questions have already been answered. So I've got just 2 left. The first one, on the new 30% to 40% PBT margin guidance, I mean, I guess reading into your comments, it sounds like there's some fresh investment that's going to go into things, including AI. But presumably, the reason you can keep the margin roughly where it has been is because you're intending to get some kind of efficiency and/or productivity savings from that. But maybe you could sort of give some color on that sort of those 2 forces, and how you're thinking about them in that mix?

And then, I guess, delving a little bit deeper into sort of one of the previous questions, yes, clearly, you've had some strong recovery, as you've touched on as well in a number of your funds in the second half of last year and continuing into this year, which is good. I appreciate you're not giving color on flows as such. But, yes, historically, when you have seen sort of some recovery following a period of weakness, you have sometimes seen investors, I guess, take money out at that point. They kept during the period of underperformance, but then came out when it did recover. So are you seeing any signs of that happening? That would be the second question.

I will start with this one. No, I mean, nothing again that we call out that's already in the numbers. And you're right, performance and flows do correlate, although it's not like it's a sort of immediately identifiable correlation. It usually comes first on the wealth channels and then institute tend to have a kind of a longer horizon, and hence, the sort of lumpiness in flows that we often refer to.

The PBT margin is really about, as I said, giving us more flexibility across the various lines compared to what we have. It is not intended to kind of change the profitability for shareholders. That's an important point I want to repeat.

When it comes to AI and technology, we're not doing this because of specific efficiency that we've identified. This is not a way to kind of capture the efficiencies. This is about us being able to continue to invest in the business, benefit from those kind of very significant advances in technology and the strength that we have. So we continue to deliver growth. Key point, as I said, is this does not change anything to the ongoing profitability of the business.

Okay. It's more about the alpha that -- potential alpha that the strategy can develop rather than anything...

Correct.

I will then go to Hubert. Hubert, you should be able to unmute. He says, hopefully.

Yes. Hubert Lam from Bank of America. I've got 3 questions. Firstly, obviously, there's been a lot of focus recently on private credit. Can you talk about your software exposure within your U.S. private credit business, and any commentary about credit quality within that line?

Second question is also on credit. Can you just also talk about the deployment within Varagon? How that's coming along? How much dry powder you have there currently?

And last question is on 1783, another strong year of performance. Can you just talk about what you can do to scale up that product given that, that seems like a pretty big opportunity that you can exploit there just given the strong performance?

Thank you, Hubert. Which one you want to take?

Well, why don't I start with 1783? Let's start there, and we'll split it up between us. Really pleased with the performance. You're right. Thank you for calling that out. I'm glad you're enjoying the performance as much as we are in that space. It's -- we continue to see and have really excellent conversations with clients. We have a strong belief in this product and its track record. And so this is about making sure that we can convert some of those conversations into investment. But we feel very good about it. The performance is robust. We continue to see strong engagement on it. And so that's -- the scale is there. We have the capability, and it has the capacity to operate.

I'll take the, I am sure it is, private credit piece, just on our exposure. Let me do it slightly differently. We have very limited -- let me say it at the start, we have very limited exposure to software and technology across both of our direct lending and opportunistic credit books. For background, direct lending, software and tech exposure is sort of somewhere sub-6%. Think about it like that.

But also think about it in a slightly different way. This is a middle market business where also it's been run with high discipline in underwriting and risk management. So this piece that we talked about through last year about being slower in deployment, because we valued the risk management approach and proper underwriting quality, was what we continue to believe is the right thing to do.

Our exposure is far less than any of our peers, but also we're not facing retail markets. This is an institutional-facing business. So we also don't suffer or have to worry about liquidity mismatch, for example. So we believe this is a good strategy. Middle market provides good opportunity. We run our business with high discipline and high-risk focus. We're not exposed to the sector in the way that you might have been seeing others have been. We don't have liquidity mismatch issues, and we continue to have strong belief that this is an area for development.

In terms of dry powder?

Still $4.9 billion is a number we mentioned. And underlying in the AUM categorization, and the direct lending category has deployed a bit more capital, so you don't see it, but it's the underlying AUM has actually increased. It's obviously increased more because of the acquisition of Bardin Hil we have made in the year.

Before I go back to the screen, we still have a couple of questions, I'm going to read a question from Mike Werner, who seems to have issues probably dialing in Webex. We saw a significant increase in long-only performance fee-eligible AUM in 2025. Was this due to a large mandate? Or is this a trend we should expect to continue going forward? If you go to Slide 10 of our presentation, you see that at the end of '25, we have $13 billion of long-only AUM that was performance fee eligible. That's increased from $5.8 billion as of the end of 2024. That is a series of mandate. It is not a single mandate. Obviously, there are entity mandates, so they tend to be sizable by construction, but it's not just one, it's a series of mandates. And that in part explains why we generated $100 million of performance fees in long-only in 2025.

Second question from Mike, is it possible to get a breakdown of seed capital between public and private markets given the delta in equity in those strategies? The answer is yes, you have it in Slide 14 at the bottom, liquid markets account for 79% of our seed investments and private markets 21% of our seed investments on a gross basis.

I will then go to Isobel. Isobel, you should get the request to unmute.

Can you hear me okay?

Yes. We can.

Go ahead, Isobel.

I just have one, please. So if you take a step back and look at the Man platform, holistically, where do you think there are potential capabilities you're missing or need to enhance inorganically going forward?

Thanks, Isobel. I'll take that question. We have always been very clear we will always look for capabilities that are uncorrelated to that, that we have today, but still rhyme with the verbs announced that we understand. But let's be clear, that doesn't -- that comes from organic growth. We can demonstrate that as you think about, for example, the high-yield and investment-grade credit business we've built here organically. That is -- that speaks to the capability we have already to grow that capability. It's not just about M&A. We added 5 new teams into the discretionary space. So we're interested in capability that comes, again, in an uncorrelated content from that space.

So we're not focused on a specific area. You know the strategy that we're trying to follow. We feel like we're making great strides in that space. But right now, we are very, very focused on the book of business we have in front of us, and we'll continue to look for capabilities that we don't currently have. But right now, we're feeling quite good.

And then we have 1 last question from -- or questions from Jacques-Henri. Jacques-Henri, I'm going to request you to unmute. We haven't had the chance to get acquainted. So if you could tell us which firm you're from as well. That would be great. Thank you.

Can you hear me?

Yes.

Yes.

I'm Jacques-Henri Gaulard, Kepler Cheuvreux. I had 2 related to the updating model framework on the PBT. Getting the 30% to 40% now, is it a bit a reflection of the fact that 2025 was really, really tough, despite that, you more or less made it? And it's like if we can make it in that type of condition, then we'll definitely make it whatever happens almost, sorry about that.

And the second question would be your non-core costs is actually a little bit lumpy, and the definition is effectively quite range. Would you consider probably reducing the range of those core costs to actually include some of them into the pretax margin definition? Some of your peers, for example, include the restructuring costs in there. That's it for me. Congrats for this morning.

Thank you, Jacques-Henri, for the questions. So the range is really a reflection of the evolution of the business over the last now 13 years. When the previous framework was put in place, the business was going through heavier restructuring with a very focused approach on costs, fixed costs in particular. And that's why previous management focused on kind of single-line item targets across the P&L.

As we evolve the business, as we invest for growth, as we invest in technology, but also grow our teams, we feel that having the ability to use the cost P&L line more fungibly makes more sense with that importantly taking away from shareholders. So do not read anything into it.

The second question is on non-core costs. You're right that last year, we had an increase in the non-core costs for really 3 specific reasons. Most of them really related to 2025. The first one is the court case, which is ongoing. That went to trial in March of last year. The trial will conclude in March of this year. So we incurred some legal costs. This relates to allegations made from the 1990s. So firmly not sort of related to the current core business, which is why they sit in non-core.

The second was the kind of restructuring charge we took around the middle of last year, as we addressed difficult first half and realigned resources across the business. That's another around $30 million, of which $10 million is noncash, $20 million is cash.

And then the third element in the non-core line, which is more in keeping with what you usually see is the noncash impact of reevaluation of liability in relation to Asteria partnership. Asteria, you might recall, is a joint venture that we have focusing on wealth in Italy in particular and continent in general. It's going very well. As a result, the implied valuation of the liability that we have remaining on our balance sheet has increased and also flows through the non-core. We're not proposing any change to our definition. Importantly, what you saw last year is not on the basis of a change either. It's just the same definition, in a year that's a bit exceptional.

With that, I don't believe we have any more questions. So we'll finish here. Thank you all very much for your time.

Thank you very much.

Good morning, everyone, and thank you for joining us today. I'm Robyn Grew, the CEO of Man Group, and I'm joined by our CFO, Antoine Forterre. As usual, I'll start with some highlights, and then Antoine will take you through the numbers. After that, I'll provide an update on the good progress we continue to make against our strategic priorities.

The first half of 2025 has been extraordinary as global markets experienced unprecedented volatility, testing investor confidence and market resilience. While we returned to relative stability in recent weeks, key uncertainties continue to persist. Trade policy remains fluid with ongoing implications for global supply chains. Tariffs also present possible consequences for growth and inflation, which has some major developed central banks in a wait-and-see mode. Meanwhile, unresolved geopolitical tensions add another layer of complexity to the landscape. During this period, we are pleased to generate overall investment performance of $2.5 billion with our long-only strategies once again delivering particularly strong returns.

However, our alternative strategies fared less well. This was largely driven by trend following programs, which faced significant headwinds, as I'm sure many of you are aware. Total net inflows were $17.6 billion for the period, our strongest 6 months on record. This was 11.5% ahead of the industry, which truly validates our position as a trusted partner to our clients. This exceptionally strong period of organic growth drove our assets under management to a record $193.3 billion at the end of the first half, 15% higher compared with the 31st of December 2024. Core management fee earnings for the period were $0.085 per share, while core earnings were $0.097 per share. These financial results particularly reflect the challenging market backdrop for trend following. However, they also serve to validate our strategy and underscore the value of the diversification we continue to build across our business.

I'm proud of the team's strong progress against our strategic priorities this year, including the acquisition of Bardin Hill, but more on that later. Finally, we have previously set the interim dividend at $0.056 per share until reaching a 1:2 ratio between the interim and final dividend. Having achieved this target with our 2024 final dividend of $0.116 per share, going forward, we intend to set the interim dividend at 1/3 of the previous year's total dividend. Accordingly, the Board has declared a 2025 interim dividend of $0.057 per share.

As mentioned, our long-only strategies delivered strong returns. The category was up over 8% overall, with particularly notable returns from emerging markets' Core and Global Core. Our alternative strategies delivered negative performance overall as market conditions during the first half created a challenging environment for trend following, as I mentioned earlier. There were, however, several positives on the alternatives front with solid investment performance across many of our other strategies, best represented by 1783, our flagship multi-strategy offering, which continued its strong run to the end of the half, up 6%. These results highlight the importance of further diversifying our offering.

During the period, Man Group's relative investment performance on an asset-weighted basis was 1.2% behind similar strategies offered by other investment managers. While our long-only strategies registered strong outperformance versus their respective benchmarks with notable returns across the Man numeric range and our credit strategies. This was offset by negative relative performance from certain alternative strategies. In particular, AHL Evolution, which is a unique offering that trades harder to access markets, weighed on the metric as its benchmark index has a lower realized vol and broader selection criteria for inclusion beyond traditional trend following.

On the topic of trend following, the industry has faced significant performance headwinds in 2025, one of its worst periods in decades, and our strategies have been no exception. The primary driver of this has been the reversal of the Trump trade in Q1, followed by unprecedented policy volatility emanating from the current U.S. administration, which created what can only be described as on-off dynamics that generated a whipsaw effect in markets. This was felt most acutely during April following the announcement of comprehensive tariff programs on the second, markets declined sharply, prompting our systematic strategies to derisk and reposition. However, the subsequent unpredictable announcement of a 90-day tariff suspension on the 9th of April triggered an immediate market reversal, causing markets to rebound in a sharp V-shaped pattern and hurting trend followers positioned for continued weakness.

To contextualize this environment, the SocGen Trend Index experienced one of its worst drawdowns in 25 years. And as you can see, our own strategy, AHL Alpha has experienced an abnormally high frequency of returns in the left tail. However, it's important to note that significant drawdowns are not unique. During the global financial crisis, trend-following experienced a peak-to-trough drawdown of over 17% and patient investors were ultimately rewarded. We believe the current environment, whilst challenging, reflects temporary policy-driven disruptions rather than fundamental structural changes to market dynamics. As markets adapt and policy uncertainty eventually subsides, we expect trend-following to resume its historical role as a crucial liquid diversifier that provides complexity when investors need it most.

Our distribution network remains one of our greatest competitive advantages, and I'm pleased that the client-led growth in our business remained exceptionally strong despite market volatility and continued lack of realizations from private equity. Total net inflows of $17.6 billion for the period were driven by long-only strategies with continued client demand for liquid credit alongside an exceptionally strong period of demand for our systematic long-only strategies. A particular highlight was a $13 billion subscription from a single client with whom we have collaborated to develop a responsible low-tracking error solution. It was a more challenging environment on the alternative side as we have naturally experienced a pickup in redemptions following a softer run of performance.

This was felt acutely in the wealth channel where the sensitivity to short-term performance is higher. Overall, therefore, it was pleasing to see that on a relative basis, our net flows remained ahead of the industry with our sustained market share growth truly validating the quality of our diversified product offering and partnership-led global sales capabilities. In today's complex environment, investors need strategic partners who are innovative, adaptable and forward thinking. We made a conscious effort to listen and respond to our clients, providing them with a single point of contact that understands their unique requirements. This client-focused approach has enabled us to attract and retain assets significantly faster than our industry peers.

This slide showcases the strength of our client engagement this year, which stems from our ability to evolve and stay relevant through our broad offering. Despite certain alternative strategies facing headwinds, engagement remains robust across the category as our clients recognize that differentiated liquid solutions are fundamental to effective long-term portfolio allocation. Given our diverse range of uncorrelated capabilities designed to perform across varying market conditions, combined with our ability to customize at scale, we are ideally positioned to serve as their strategic partner throughout this journey.

Before I hand over to Antoine, I wanted to take a step back and reflect on the year so far. The strategy I set when becoming CEO is demonstrably working. We have successfully grown the business, expanded capabilities through new team hires and the Bardin Hill acquisition and delivered strong performance across quant equity, credit and 1783. Given the significant pace of change, both within our firm and externally, we have taken action to further streamline our organization, which will enable us to move faster and operate with greater clarity as we execute our strategic priorities to diversify and build scale around our high-quality core. Through this disciplined approach to resource allocation, targeted investments and rigorous cost management, we're building a better, stronger business positioned to thrive during this period of paradigm shift and AI revolution, ensuring we do everything within our control to deliver sustained success for our clients and shareholders alike.

Antoine will provide more detail as he takes you through the numbers.

Thank you, Robyn, and good morning, everyone. As usual, I'll begin with some financial highlights before moving on to our AUM, P&L and balance sheet. As Robyn mentioned, I'll also provide more color on the actions we are taking as we take stock of the current environment. In the first half of 2025, we recorded net revenue of $604 million, with net management fees of $517 million, a 6% decrease compared to the same period last year. The decline was primarily driven by a decrease in AUM in higher-margin strategies, reflecting the challenging market conditions for trend-following.

We generated $67 million in performance fees with both alternative and long-only strategies contributing, demonstrating the continued progress we have made in diversifying the business. We also recorded $19 million in investment gains from our seed book in the half. Fixed cash costs increased to $222 million in the period, and the total compensation ratio was at the top of our guided range, reflecting the lower net revenue recorded in the period. Our core PBT margin consequently decreased to 24% in the first half of the year. Overall core profit before tax was $146 million and core management fee profit before tax was $130 million.

Finally, we continue to have a strong and liquid balance sheet with net tangible assets of $674 million as of the end of June, which continues to support our disciplined capital allocation policy. We ended the period with AUM of $193.3 billion, a new record for the firm, up nearly $25 billion from the end of 2024. As Robyn mentioned earlier, the increase was driven by net inflows of $17.6 billion, positive investment performance of $2.5 billion and positive other movements of $4.6 billion. We did, however, experience $3.5 billion of net outflows from alternatives, of which $1.5 billion related to absolute return strategies. This follows a period of challenging performance from trend-following strategies.

While net flows of $21.1 billion to long-only strategies were driven by the large mandate win Robyn mentioned earlier, we still raised nearly $8 billion net from other clients during the period. This is an exceptionally strong outcome in the context of the current fundraising environment. Positive other movements of $4.6 billion includes $7.5 billion of FX tailwinds owing to the depreciation of the U.S. dollar as approximately 45% of our AUM is denominated in other currencies. Owing to the strong growth in our long-only strategies, our run rate net management fee margin decreased to 55 basis points at the end of June compared with 63 basis points at the end of December 2024. It is worth noting that the large systematic long-only mandate alone drove half of that reduction.

As I have emphasized many times before, we do not manage to a specific margin, but instead focus on profitable growth across all our product categories, and Robyn will talk about the scalability of our long-only quant equity offering in this context in the finance section. Our run rate net management fees, which represents a point-in-time snapshot of the firm's management fee earning potential remained largely flat compared to December 2024 at $1.055 billion.

Moving on to performance fees. Core performance fees for the period were $67 million, comprising $32 million from alternative strategies, 1783 in particular, and $35 million from systematic long-only strategies. This reflects the progress we have made in diversifying the performance fee earning potential of our business. Although the contribution from transferring strategies was nil in H1, we continue to have confidence in their ability to deliver valuable performance fees for shareholders in the future as they have done in the past.

Gains on seed investments were $19 million, which highlights the continued benefits of seeding portfolio adds for shareholders. At the end of June, we had $51.8 billion of performance fee eligible AUM with $17.3 billion at high watermark. And as at 23rd of July, we had accrued roughly $55 million of performance fees due to crystallize in 2025. This figure is not a forecast or guidance, but rather the position at a specific point in time, the amount that crystallize will fluctuate, increasing or decreasing based on investment performance up to crystallization date.

Turning to costs. Fixed cash costs of $222 million in the first half were 9% higher compared to the same period in 2024, driven by the weaker U.S. dollar as approximately 60% of our costs are incurred in sterling, along with previously announced targeted investments to support our strategic priorities. Variable compensation costs decreased to $161 million, reflecting lower revenue in the first half with our compensation ratio for H1 at 50%, the top of our guided range. Our previous fixed cash cost guidance of $425 million for 2025 assumed a dollar sterling FX rate of $1.25. Prior to the cost actions detailed today, adjusting this for H1 actuals and the current FX rates would imply full year fixed cash cost of $442 million. Our cost actions are expected to result in a $10 million cost saving in 2025. Accordingly, we are revising our fixed cash cost guidance for this year to $432 million. This assumes an FX rate of $1.35.

In summary, despite record AUM and net inflows, the mix of underlying assets under management led to a decrease in overall management fee revenue. Combined with FX headwinds and continued investments in our business to support future growth, this resulted in core management fee PBT in the first half of $130 million, 20% lower than the same period last year and core management fee earnings per share of $0.085. A lower-than-average period performance fee profit resulted in core PBT of $146 million and core earnings per share of $0.097 in the first half of 2025.

The headwinds facing transferring strategies have impacted our profits this year. And as Robyn said earlier, we have taken action. Our efforts have been focused on 3 areas. Firstly, we have further streamlined our operations. This includes reducing management layers, accelerating near-shoring plans and simplifying our organizational structure. For instance, you may have seen the recent announcement regarding the combination of our systematic businesses, which represents a shift towards a more collaborative platform that can benefit from shared research, data and trading capabilities, particularly in the quant equity space. We're also deprioritizing certain noncore initiatives that have limited potential or midterm impact.

Secondly, together with some headcount reduction, we are reducing nonessential G&A spend, resulting in the previously mentioned $10 million decrease in fixed cash cost guidance for 2025. We have also proactively reduced our seed exposure, primarily the acquisitions financed externally to reduce the associated run rate net finance cost by $8 million. Importantly, this has been done without compromising on the strategic optionality of our program.

Finally and importantly, we remain committed to investing in key growth areas that drive our strategic priorities forward and diversify our firm for the future. You can see that in the progress we have made building our credit platform and the amount we continue to invest in our technology capabilities. Those investments rely on the remarkable people we have in our firm. The actions mentioned above allow us to focus our efforts on scalable strategic priorities to drive long-term value for our shareholders. It is possible that if transferring performance does not recover by the end of the year, we could modestly exceed the upper end of the guided total comp ratio range in 2025.

In summary, we will continue to maintain the cost discipline that we are known for and take an agile approach to navigate what lies ahead, protecting our talent and investing strategically in areas that drive long-term shareholder value. Our balance sheet remains strong and liquid, which gives us optionality and flexibility to invest in the business to support our long-term growth prospects, evaluate M&A opportunities and ultimately maximize shareholder value through capital returns. At the end of June, we had $674 million of net tangible assets, including $126 million in core cash and cash equivalents. Gross seed investments at the end of June were $677 million, $489 million of which were on our balance sheet. We maintain a diversified seeding portfolio with investments across both alternative and long-only strategies in liquid and private markets.

Despite the actions outlined earlier, we continue to deploy capital strategically in 5 new strategies in the first half of 2025 in addition to announcing the Bardin Hill acquisition. As I've mentioned before, we consider the most efficient financing available to support operational initiatives, including using our revolving credit facility. Our business model is highly cash generative, and the cash flows support consistent capital returns to shareholders. Our capital allocation policy remains disciplined and intend to support the future growth of the business while delivering attractive returns to shareholders. Including the interim dividend proposed today and the $100 million share buyback currently in progress, we have announced $165 million of shareholder returns in the first half of 2025. This takes the total capital return to shareholders over the past 5.5 years to $2 billion via a combination of dividends and share buybacks. Remarkably, this represents over 73% of our market cap at the end of June.

The decrease in share outstanding over the time frame means shareholders now receive an additional 27% of every dollar of earnings when compared with 2020.

On that note, I'll hand over to Robyn to take you through the final section of our presentation.

Thank you, Antoine. Last year, I outlined our long-term strategic priorities, each of which represents a significant exciting growth opportunity for us. As a reminder, we aim to further diversify our investment capabilities, notably in credit, quant equity and solutions and to extend our client reach with a particular emphasis on wealth, North America and the insurance channel, all whilst leveraging our existing strengths and scale. This year, we continue to make significant progress on our multiyear strategic priorities, advancing key initiatives that diversify and scale our business while strengthening our competitive position.

On the solutions side, our multi-strategy offering, 1783, maintained its strong performance, and we enriched our offering by adding 4 new discretionary alternative investment teams. On the client side, we continue to deepen our relationships, engaging with a number of new large institutions in the U.S., establishing the major [indiscernible] partnership within the insurance channel and raising over $1 billion of additional capital through the Asteria JV in Wealth. I'm delighted with our progress, and I'll spend some time today talking about the work we've done on our credit platform, quant equity capabilities and our technology edge. A highlight this year has been the continued growth of our credit business, which has established itself as a cornerstone of the firm.

As at the end of June, we managed AUM in credit of $42.7 billion, up from $14.7 billion just 2 years ago. Our liquid offering spans multiple strategies with global high yield and investment-grade opportunities, which have delivered industry-leading returns and gained strong client traction across geographies, channels and client types to emerging markets corporate credit, where our new launches have seen good early momentum. We've also leveraged our quant heritage to build a meaningful presence in specialized areas of systematic credit, including catastrophe bonds. Our strategic move into private credit through acquisitions and team hires has broadened our capabilities.

Building on this success, we're pleased to announce earlier this month the acquisition of Bardin Hills, a New York-based private credit manager with $3 billion in AUM. Bardin Hill specializes in both opportunistic and performing credit strategies. Its opportunistic platform focuses on U.S. distressed and special situation investments alongside U.S. nonsponsor-backed direct lending, while its performance credit platform concentrates on broadly syndicated loan CLOs. Led by a highly experienced management team with an average industry tenure of 22 years, all of whom are joining as part of the deal, Bardin Hill has significant expertise in managing credit strategies for a sophisticated global client base that includes pension funds, endowments, foundations, insurance companies and consultants.

The acquisition adds capabilities that are highly complementary to our private credit offering while strengthening our U.S. presence and supporting our strategic priorities across solutions, wealth and insurance channels. Recent experience with our U.S. direct lending offering has validated the growth potential across opportunistic and performing credit markets, and we look forward to capitalizing on these opportunities. Completion is expected later this year, subject to certain conditions. With the credit market becoming increasingly attractive to the world's largest institutions, we remain focused on expanding our existing capabilities while exploring opportunities to grow further, whether organically or inorganically. We've also made strong progress in long-only quant equities, building from our position of strength given our quant heritage and culture of innovation. We've grown the size of our systematic long-only business by over 70% in the past 2 years with our track record of alpha generation and recent client demand, demonstrating the platform's potential.

Remarkably, over the same period, the headcount in our investment team is pretty much unchanged. This shows the scalability and earnings potential of our offering. A notable milestone this year was securing a large mandate of our -- for our global strategy, which was developed in collaboration with our clients and exemplifies our ability to innovate and leverage expertise from across our firm to deliver highly customized solutions. The growth we're seeing across quant equities reflects our broader competitive advantages, our focus on alpha generation, our cultural DNA for client partnership, our ability to deliver at scale and the quality of our institutional resources. We're well positioned as clients increasingly seek fewer, more capable providers who can help them navigate their most complex challenges.

Another key differentiator is our technology platform. Our early continuous and significant investment in tech has created a lasting competitive edge that is not easy to replicate. The stats on the left of the page gives you a sense of the power of our platform, which is orders of magnitude ahead of most asset managers. It enables us to trade across numerous markets, execute larger volumes and operate with speed and agility. These figures are significantly higher than they were a few years ago as we've continued to invest substantially in strengthening our capabilities. This year, our investment has focused on generative AI centered on building sophisticated autonomous agents to augment our investment process. These enable rapid analysis of complex data sets and automated decision-making with the potential also to transform our operational efficiency and scalability, ultimately delivering better outcomes for our clients and value to our shareholders.

I can't emphasize enough how important this is to us, operating in an industry that, like most others, is becoming more technology-driven. For us, technology isn't just about making better investment decisions. It permeates our culture and powers everything we do. We entered the second half of the year with good momentum. While trend-following has faced one of the most challenging markets in decades, our strategy to diversify the business is working. We've generated solid investment performance across credit, quant equity and solutions, all of which are multiyear priorities and uncorrelated to trend. We've raised record AUM from our clients globally, demonstrating the depth of partnerships and our relevance to them. And we've done all of this while staying true to our ethos of cost discipline.

These actions strengthen our business and build a robust platform for continued growth in the years to come. I'm confident that our core strengths, exceptional people and cutting-edge technology will help us deliver for our clients and shareholders in the future.

With that, we'll open up for analyst Q&A. [Operator Instructions]

And with that, we'll start with Arnaud, first of the block.

Three questions, please. If we start with the performance fees. So this half, you earned about half of your performance fees from the systematic long-only. And if I compare the level of performance fees you earned there versus history, it's clearly at a higher level. I'm just wondering if the conditions required to earn performance fees in those strategies have changed. Should we be looking at performance fees from that category as something more sustainable going forward?

My second question is on the absolute return outflows. So quite a challenging quarter, Q2 for you. And I think you explained that was given the recent underperformance. The AHL strategies haven't rebounded much of late. I'm just wondering what the outlook there might be? And specifically, you indicated that the outflows came from the wealth channel. I'm just wondering if those are higher margin. And a final question on costs, $10 million cost to come through. I'm just wondering what that run rate number looks like going into 2026 and if there's more flexibility if the environment remains challenging in H2.

Thank you, Arnaud I think they're all for me. That's okay. So in the order you've asked them, you're right. So strong contribution to performance fees from long-only systematic this period. You really have 2 drivers for that. One is the very strong performance of the strategy across the board, quant equity alpha has been strong this year, but also last year, and our team is doing particularly well there with around 4%, 5%-ish of kind of annualized AUM weighted outperformance versus relative benchmark. So the performance is one driver. The other aspect is the performance fee eligible long-only AUM that we have. And you will have seen that, that has increased in the half as well. And so the performance fee potential has increased from that category.

Second question on absolute return outflows. we don't comment on future flow, but you're right that we had some outflows, which we called out in Q2 from wealth strategies in particular. They tend to be kind of more reactive to short-term performance moves. The margin in those products is broadly in line with the category margin. And then finally, on costs, we announced in July this kind of cost program and reorganization that will lead to $10 million of fixed cash cost saving in the second half. And I think now you can analyze that as a number in your target. As you know, we don't give sort of 18 months ahead cost target. We remain, as we've been in the past, cost conscious whilst aiming to invest for growth in the business and making sure that we can reward the team fairly. So this is the view on cost.

Thank you, Arnaud. In the order to come, I will go to [indiscernible]. I will leave you possibly sorting out some text at your end because it looks like it works at our end, and I'll go to Angeliki in the meantime.

Just a few questions from me. First of all, I was looking at the Varagon AUM at $9.9 billion, which are again lower versus the previous quarter and semester and haven't really grown since the time of the acquisition. So I was just wondering if you can give us a little bit of color behind that. Why has there been a decline there? And when I look at some of the U.S. private credit peers, they seem to be deploying much faster than Varagon. So I just wanted to understand the dynamics there. And then also in the context of the Bardin Hill acquisition, what is the rationale of the acquisition? I mean, obviously, except for adding another $3 billion in credit, are there any synergies or cross-selling expected either with your existing franchise in the U.S. or your European franchise? If you can explain to us a little bit what sort of the growth that you expect to see in those 2 areas, Varagon and Bardin Hill over the next sort of 2, 3 years?

Then a question on absolute return. And thank you very much for the answer to the previous question on the outlook. I was just wondering -- the U.S. administration policies have proven to be quite unpredictable, as you pointed out in your opening remarks. And that's probably an unhelpful backdrop more generally for trend-following strategies. Given that we have another 3 years ahead of us as it looks like of the current administration, could that mean that performance in trend following is going to remain challenged for longer? And are you having any conversations with your clients that are sort of pointing to that fact and are perhaps a little bit more hesitant to put capital into those strategies in the current environment?

And then one last question on Man Strategy 1783. What is the total AUM today? And how big can the strategy become? Are there any capacity constraints?

Okay. I say -- why don't you start with Bardin Hill.

Yes.

Absolute return between us and 1783.

Very happy to. And thank you for your questions, Angeliki. So Varagon is progressing as planned. You're right that reported AUM, which is really the AUM deployed on which we're earning fees has slightly reduced committed capital of $4.9 billion for all the private credit offering that we have is actually in line where we were last year. Varagon focuses on mid-market direct lending, sponsor-back direct lending in the U.S. And at the end of last year, early in this year, the outlook for deployment was looking great. And then since February and some of the first kind of reversal of trade that Robyn mentioned earlier, that kind of M&A market has been very slow. Hence, the new deployment. But over the period, we have raised $1 billion of capital for them. So the comment that it's working as planned. Bardin Hill?

Yes. Bardin Hill, thank you for the question. Bardin Hill, the rationale, again, this is about capability and content. It's an area in which we -- particularly on the opportunistic credit side, where we just don't have that talent in the organization. It's something we know clients are very, very interested in. On the performing side, it adds about $1 billion of performing credit into the organization. Again, a strength that helps us propel ourselves forward in that credit space. There is an interesting synergy between the Varagon business in that sponsor-backed lending space and the non-sponsored backed lending space where there is an ability to indeed collaborate and have a movement between those 2 entities.

We believe there are great synergies in that space. It strengthens our U.S. platform. It adds about 50 people, just under 50 people into our U.S. space. And so it hits a number of the initiatives, the strategic objectives we have to build out relevance in credit to continue to grow U.S. to provide content that's orthogonal or uncorrelated into and for our clients. And we know it's an area where our clients are very, very interested. So hopefully, that answers the Bardin Hill rationale.

In absolute return, I think this was a question about trend. It's difficult to predict what's going on in the market. It's not something that we are here to do particularly, but we have conviction that trend continues to be a valuable component into client portfolios. It certainly is there as defensive alpha position at the moment. And then things inevitably will, we believe, calm down. I can't give you a time frame on that. I think you will start to see the trends returning into the market space as they have and as the data demonstrates. So we have high conviction that trend is still valuable. It's important to clients. It's part of defensive alpha at the moment in people's allocation, and we continue to have conviction in it going forward.

And then 1783, it's around $2.5 billion of AUM, which is kind of a portion to the underlying categories in our AUM reporting, capacity up to kind of $5 billion as it is now, but it's a program that we can scale by hiring teams. Robyn mentioned 4 new discretionary teams being hired in the first half and building capabilities across the firm. It's one of the key priorities for us within our kind of solution focus and also helps with kind of the wealth channel in particular.

Thank you, Angeliki. I will go to Bruce.

I'll go to David McCann and then come back to Hubert and then Bruce.

Hope you can hear me.

Yes.

Yes.

Yes. Perfect. Three from me, please. First of all, can you just clarify, you mentioned Antoine, in your remarks that there's a possibility you might exceed the 50% comp ratio in the second half. I mean, is that predicated on any particular threshold for outflows from here in alternatives? Or have you built any kind of margin of safety that would kind of leave you below the 50% level? I'm just trying to understand the dynamics, what should we be watching for as we see your Q3 numbers and the trend strategies in particular evolve.

Second question, on the trend strategies. Have you made any changes to the investment process, i.e., has there been any style drift here in those strategies? We know that some of the press around the return to office mandate for a number of your people in that area and linked to that some of the projects. So have you actually done anything different that could alter returns there? And then finally, just on the same topic really, no doubt a question you're getting from clients. So I'd just be curious as to how you're defending this and answering that question. Clearly, many clients buy these to be tail risk hedges, the trend-following strategies. And obviously, they didn't really deliver that in April when it was most needed. So how are you defending against that line of questioning?

Thank you, David, for the questions. I'll take the first one. At this point, the guidance range guidance range stands. So 40%, 50% remains the guidance. As we've discussed in the past, we remain committed on being cost conscious but also invest in the business. And so what we will do is look at kind of performance of the business between now and the end of the year and take stock of what that means. But at this point, the guidance stands.

Let me take the second one, David. It is an incredibly useful experience. It's always good to have people review and think about whether there's anything better or different we should be doing around the investment process with trend. The short answer is actually, nothing confirmed that there is nothing structurally wrong in the strategy at all, validated the strength of the analytics and the research. We always look, as you know, to incrementally review and change these things. But actually, the exercise did not demonstrate anything that was structurally wrong at all with the investment process. Linking that into the last question you had on clients and how we're talking to clients. Clients are very well aware that trend strategies have headwinds in such volatile whipsaw markets. In fact, there is a good understanding, I think, that there wasn't an expectation of trend being able to operate in markets which change so quickly.

So this has become a discussion with clients that's much more enriched around portfolio and risk management, portfolio construction and risk management and the elements they're looking for to navigate the volatility in markets today and as they move forward as we see this significant change in the way that markets are operating in a market environment, as I talked about earlier, which is going through an industrial revolution with AI and with the other macroeconomic factors that are featuring. So I think this is not a discussion as much as defensive of trying to defend where trends performance is, clients understand that. It's a question of how they construct portfolios now to navigate this new paradigm.

I'll go back to you, Hubert.

Three questions. Firstly, on -- sorry, go back to the AHL. How much AUM do you have financial strategies within the wealth channel? I think that you pointed out that was the culprit for the second quarter outflows. And is this -- do you see near-term risks in the second half given what we saw in the second quarter and given performance? Second question is on M&A. So Bardin Hill was a good acquisition, adding new capabilities. In which areas do you think you're currently missing that you potentially do more within M&A? And lastly, you had a good win of the $13 billion, which you mentioned. So should we expect more such M&As to come? What is the fee margin there? And also, does it also have performance fee potential?

Thank you, and thank you for your questions. So we don't, as you know, comment on future outlook. We don't disclose I'm afraid of specific AHL AUM in wealth, but it's within the traditional trend following category in particular in our reporting. So that's where you'll find most of the wealth AUM for AHL. Bardin Hill, thank you for the comments about a good acquisition. We would agree. I think acquisition remain a way for us to deliver strategy, but we have to acknowledge that we haven't yet closed Bardin Hill, and we need to close and integrate the business. And so whilst we will continue to look the sort of urge to do something is probably reduced over the next 12, 18 months. It doesn't mean we won't do anything, but it means that the sort of urge to look for something new isn't there.

And the way we think about M&A hasn't changed. It's about adding kind of quality capabilities to our offering so we can supplement and enrich the client discussions. And then the mandate, we won't disclose the margin specifically on that mandate because of client confidentiality. It's a global equity mandate at fairly low tracking error, and you will see the impact it had on the overall margin. It funded towards the end of Q2. And so it's reflected in the run rate margin in AUM that you see. There was a 4 basis point impact on the overall margin reduction in the period.

Bruce, I will go to you again. What I suggest you do, Bruce, is you ping me or Karan and we will make sure we answer your question as a follow-up.

With that, thank you very much everyone.

Thank you.