Man Group Profit Rises on 11% Gain in Client Assets

Man Group Plc, the world's largest publicly traded hedge fund company, said fiscal first-half profit rose more than analysts estimated as it took in more client money and boosted management fees.

Net income from continuing operations for the six months ended Sept. 30 rose about 16 percent to $672 million, or 34.1 cents a share, from $580 million, or 29.2 cents, in the year- earlier period, the London-based company said today in a statement. Analysts forecast a profit of $625 million, according to the average of five estimates compiled by Bloomberg.

Man Group increased funds under management by 11 percent to $68.6 billion over the six-month period. Its performance fees rose 28 percent at a time when hedge fund managers including New York- based Bear Stearns Cos. have had to liquidate funds to cope with declines. The second half of the year ``started strongly,'' Man Group Chief Executive Officer Peter Clarke said.

``Given the market backdrop, we believe the performance is holding up relatively well,'' said Nic Clarke, a London-based analyst at Charles Stanley Group Plc, in a note to clients. ``We are pleased to read that the second half has started strongly,'' who rates the stock a ``buy.''

Shares of Man Group rose 0.3 percent to 560.5 pence at 11:30 a.m. in London on a day when concerns about U.S. subprime losses pulled the FTSE All-Share General Financial Index down 1.8 percent. Morgan Stanley, the second-biggest U.S. securities firm, joined Merrill Lynch & Co. and Citigroup Inc. yesterday in booking losses on subprime mortgage-related assets and said it lost $3.7 billion in the two months through Oct. 31.

Man Group shares are up 5.4 percent this year, valuing the company at 10.8 billion pounds. The stock has outperformed the 40- member FTSE General Financial Index, up 1.6 percent.
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