Corporate Reporting: Performance Analysis and Investor Decision of Aberdeen Plc

This report analyzes the performance of Aberdeen Plc, a financial service provider and asset manager, and its impact on investor decision-making. It covers revenue generation, investment opportunity, cost of funding and margin, client retention rate, and sustainability initiatives. The report also includes an introduction to the financial sector and Aberdeen Plc, as well as a conclusion and references.

Corporate Reporting
TABLE OF CONTENT
INTRODUCTION...........................................................................................................................2
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10
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INTRODUCTION
Corporate reporting is bridge between company and their investors, this reporting allow
investor to analyse performance of firm and help them to make further investment decision. This
study is based on Aberdeen Plc, this company is financial service provide and asset manager.
This report will discuss introduction of sector and company. Later this report will discuss
performance analysis and investor analyse. At last this report will discuss sustainability and
investment decision.
Introduction to sector and company
Financial sector in every economy is fuel of country’s growth, this sector alone contribute
in betterment of the country. Businesses of financial sector provide financial and investment
consultancy service to other companies, these private institution works as bank and provide
investment related solution to client companies. In 2020, this sector actively contributed 164.8
billion euro in the UK’s economy. Financial sector generate higher rate of employment in the
country, stay active in import and export performance of country and create surplus trade flow in
financial market of UK. With 8.6% of total economic output, this sector has become largest in
London and third largest in OECD alone in the year 2020. Listed businesses of financial sector
attract foreign investment in the country, these businesses not only provide financial consultancy
to companies of UK but they help many multinational companies to survive any economy of this
world. Even after Brexit, financial market can be seen rapidly growing and creating better
relationship with European Union, trade provision in both the territory seems to be better
because of these businesses who deal in this sector (Miethe and Pothier, 2016).
This study is based on Aberdeen (Standard Life Aberdeen Plc.), this company is largest
asset manager with over millions of investment in multiple companies. This investment company
not only provide financial service to other business organization but actively contribute in the
betterment of country’s economy. Aberdeen is one of the listed company in London stock
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exchange and member of FTSE 100 index, this company invest in operation of national and
multinational companies, allowing the to increase their performance and generate surplus profit
with high level of investment. In current period, this company take 0.23% interest rate on elevate
cash which is being invested in client’s company. After Brexit, many local as well as
multinational companies faced huge problem regarding survival because of lack of funding, this
period was challenging for every business organization of UK. Through the investment of
Aberdeen, many companies found way to survive in this challenging environment, with high
quality services like investment solution, asset management and loan or credit service, this
company slowly becoming market king and financial sector ruler.
Performance analysis of Aberdeen Plc
Aberdeen Plc has become most recommended financial service company in the year 2021,
performance of this company was impressive even after COVID-19 impact (Mogaji, Czarnecka
and Danbury, 2018). This company have more investor and client than their competitors like 3i
group Plc, share price of Aberdeen provide clear understanding about their performance in the
country. There are various KPI of company which clearly highlight and compare performance,
these are:
Revenue generation: in the year 2020, Aberdeen Plc generated over $5099 million worth
of profit from their high quality services, this company marked high revenue in this year. But
when looking at result of previous years for example, in the year 2018-19, Aberdeen generated
$2844 million drastically low as compared to year 2017. It is very clear that impact of COVID-
19 was challenging to survive for every business organization; sales and revenue of every
company rapidly fall to ground. Some financial service provider, find hard to survive and ended
up in huge losses and debt (Macrotrends, 2022). But Aberdeen manages to survive hard time of
Brexit and COVID-19 impact. In current year, this company will generate $4634 million
comparing low to previous year, ending financial year will bring final result to revenue
generation of this company but estimation results clearly shows that this company isn’t
performing well.
Investment opportunity: Aberdeen Plc is one of the most successful investments and asset
Management Company in financial sector of UK, performance of this company shows
investment movement. Aberdeen holds most of assets as compared to their competitors, in the
year 2021; this company hold $13.454 billion of worth asset. But this figures tend to decreasing
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because of ineffective performance of Aberdeen, investment opportunity is rapidly declining
allowing company to face huge losses and losing strong customer base (SLFPY, 2022). In the
year 2019, this company had assets worth $14.585 billion rapidly declining from the year 2018,
before COVID-19 impact, performance of this company was excellent, this company was
generating huge profit and had worth of assets. After COVID-19, market cap and share value of
this company was impacted.
Cost of funding and margin: one way of comparing performance of every financial service
provider, analysing cost of funding and gross margin is best. Financial institutions not only
compare their performance with these methods but show these result to client and other
stakeholders of the company for further investment. The initial cost of funding of Aberdeen is
$20000, many local business organization see this as beneficial investment or funds for their
business (Profit margin, 2022). Interest rate of Aberdeen in the year 2020 was 0.23% in elevate
cash or wrap cash amount but in the current year 2022, this company is taking 0.0%. Although
charges tend to increase on the loan amount payable, financial solution and adviser service of
this company chare up to 1.75%.
Client retention rate: clients of every company and their satisfaction level shows the
performance of company, if client retention rate is lower than expected that means business
organization need to improve and need to adopt certain strategy to overcome these lower rate.
Aberdeen have strong client base allowing them to survive any market condition and tough
situation, with 46.6% of retention rate, this company is not performing well as compare to its
competitors (Alshurideh, 2016). Their competitors like 3i group Plc have 96% client retention
rate allowing them to become market leader. There are many other company who is performing
better then Aberdeen. Although, this company have effective strategy to overcome losing client
retention rate, Aberdeen can survive any market condition with growth rate.
Investor analysis and comparison of share price value from last year performance identification
Identification of Aberdeen assets management plc performance its clearly evaluated that
this company provides financial services which are less costly. So it influences performance of
investors who concern towards with the investment of fund into this company. This company
decides to take help from other company who also provide similar services and which has great
name or position at UK market place. Standard life Plc organization also provides similar type
of services. Both the company management decides to get merger their services and makes
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higher effective organization with effective financial services distribution. After merger this
company define and known as Standard Life Aberdeen plc. This company provides financial
services are multiple areas.
Therefore, major investors of this company are standard life plc because it provides
growth opportunity for stability of this organization. Standard Life shareholders held 66.7%.
And the other remaining amount will be held by Aberdeen plc shareholder. It makes more
consistency in performance and trust building with stakeholders who not concern towards with
the expansion of trust with Aberdeen plc.
From the evaluation and identification of Aberdeen plc investors like shareholders not
highly encourage towards with this company because it evaluates that it’s not provide good
returns and benefits which essential to provide by financial service company like life insurance
benefits, bonus, yearly, monthly interest and many more. Idea about this term Aberdeen plc
management team CEO decides that it’s important to involve with different company who also
provide financial services to customer and play effective role in share distribution. This
company shareholder holds 33.3% and it mainly decide when both the companies merge and
it’s become Standard Life Aberdeen plc.
It’s clear that investors highly concern towards with the effective return and less risk. From the
consideration about this term when Aberdeen plc company management team evaluate that they
have lack of return amount then it clearly analyze that they do have to engage with other
company for performance and perfect return distribution to stakeholder (Prasad, Kiran and
Sharma, 2021).
Multiple investors analyze when this company combine together and it perform tasks
with well manner. And it generates shareholders attraction with powerful manner. Idea or
information about this term it influences shareholder attraction with positive manner as well.
Company CEO, financial team, shareholders and many more raise their trust towards with the
distribution of effective services. It makes more constancy in company activities. And more
shareholders decide to involve within in application of this company services. After completion
of investors believes in trust it’s knowledgeable term that Standard Life Aberdeen plc play
effective role in financial service distribution. Because after Merger of two companies
shareholders highly satisfy with their services which is very beneficial approach. Also this
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company concern to create new approaches with uses of multiple essential approaches which
includes like distribution of shares on different price, amount.
Investor analyze that this company has duty or responsibility to develop higher security
and use technology advancement for daily identification of share values. Therefore, Standard
Life Aberdeen plc mainly concern to develop this term within in business activities.
Figure 1: Standard Life Aberdeen Plc share value
This graph represent the performance of standard life Aberdeen plc position which
represent the clear values after merger of two companies it makes more consistency in financial
performance or not. Standard life plc and Aberdeen plc merge on 2017 so from the data
evaluation of financial performance like in 2021 august this company has good position at
market. And it mainly influence pandemic situation 2020 which is very clear that this time not
only this company affects from external forces. But from the evaluation of last year
performance it’s been clear that company has good position in market. So investors raise their
trust towards with this business activity because they concern that it play good position at
market which is very effective term. In context of financial service merger of two organizations
is become beneficial approach which makes more consistency in stability expansion in financial
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aspects. Investor raise believes is invest more fund and encourage other shareholders to invest
money for profit generate (Aprayuda, Misra and Kartika, 2021).
From the evaluation of share price it will be easily determined that this company play
successful role and investors has concern towards with the application of services from this
organization or not. Share price worth of Standard Life Aberdeen plc shares sold at an average
price of 6.6 pound. And from the comparison from last few years it will be clearly analyzed that
this company performance highly influence and generate good amount of profits with effective
activities involvement. But the major challenge which not only influence performance of this
company also it affects on activities of overall company or economy activities is Covid-19. In
this situation company faces issues from shareholders because of money requirement and
completion of basic needs (Hoang and Phang, 2021).
Sustainability
Every sector and every businesses organization have to actively participate in United
Nations Sustainability Development Goals and Net Zero Carbon Economy goals of UK.
Encouragement in sustainability is rapidly increasing in the country, government and people
demanding every industry and its businesses to be more responsible towards nature and its value
(Scoones, 2016). Current topics like COVID-19, climate change and pollution awaking people of
the country and pushing government to develop policy and rules regarding control over bad
condition of climate. Aberdeen Plc actively contribute in the betterment of nature and complete
all their responsibility regarding development and betterment of community, society and nation.
Aberdeen Plc took sustainable commitment, these are:
Educating staff: Aberdeen Plc is one of those company who not only stay active in
promotion of sustainability but this company also educate their student and staff member to
become more responsible towards nature. This company provide educating program to their
staff, these program are specially being developed to show importance of nature and steps in
protecting nature.
Biodiversity preservation: Aberdeen is one of those company who have adopted
biodiversity preservation program to protect endangered species, this company provide donation
and financial help to those biodiversity program who actively work to preserve importance of
nature. Many of their investment can be seen in schools and colleges where, this company
generate resource for student and allowing them to get education (Thiele, 2016).
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Net Zero Carbon Emission: by the year 2040, UK government want their economy to be
net zero carbon which means completely adopting sustainability at every industry of the
economy. Aberdeen Plc took part in this plan of government and pledge to stay active in
achieving this goal in the betterment of society and nation.
Investors decision
From the investors analysis it’s been clear that company has good position in market. So
Investors clearly decides from the company financial values and graph evaluation that Standard
Life Aberdeen plc share price effective. Also from the different policies and performance it’s
clearly evaluated that this company provide different price of share which is beneficial for
investment process and raise money. From the market performance identification its
knowledgeable term that after merger of two financial distributor company make more
consistency in distribution of financial services (Hux, 2021). It makes more profound results as
well. From the share value identification some of the investors analyse that in pandemic situation
this company performance influence but not so higher so its clear that Standard Life Aberdeen
plc has good position for investment.
CONCLUSION
It has been summarized from the above reflective study that Standard Life Aberdeen plc
provides financial services with proper analysis and consideration of essential aspects for
shareholder performance effectiveness. It has been evaluated from the report study that
investors analysis and share prices evaluation makes more effectiveness in decision-making that
this company provide effective return.
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REFERENCES
Books and journals
Alshurideh, M.T., 2016. Is customer retention beneficial for customers: A conceptual
background. Journal of Research in Marketing, 5(3), pp.382-389.
Aprayuda, R., Misra, F. and Kartika, R., 2021. Does the order of information affect investors’
investment decisions? Experimental investigation. Journal of Accounting and
Investment. 22(1). pp.150-172.
Hoang, H. and Phang, S. Y., 2021. How does combined assurance affect the reliability of
integrated reports and investors’ judgments?. European Accounting Review. 30(1).
pp.175-195.
Hux, C. T., 2021. How Does Disclosure of Component Auditor Use Affect Nonprofessional
Investors' Perceptions and Behavior?. Auditing: A Journal of Practice & Theory. 40(1).
pp.35-54.
Miethe, J. and Pothier, D., 2016. Brexit: What's at Stake for the Financial Sector?. DIW
Economic Bulletin, 6(31), pp.364-372.
Mogaji, E., Czarnecka, B. and Danbury, A., 2018. Emotional appeals in UK business-to-business
financial services advertisements. International Journal of Bank Marketing.
Prasad, S., Kiran, R. and Sharma, R. K., 2021. Influence of financial literacy on retail investors'
decisions in relation to return, risk and market analysis. International Journal of Finance
& Economics. 26(2). pp.2548-2559.
Scoones, I., 2016. The politics of sustainability and development. Annual Review of
Environment and Resources, 41, pp.293-319.
Thiele, L.P., 2016. Sustainability. John Wiley & Sons.
Online:
Macrotrends, 2022. Aberdeen Revemnue 2017-2021. [Online] Available Through., <
https://www.macrotrends.net/stocks/charts/SLFPY/Aberdeen/revenue>
SLFPY, 2022. Aberdeen Total Assets 2017-2021. [Online] Available Through.,
<https://www.macrotrends.net/stocks/charts/SLFPY/Aberdeen/total-assets>
Profit margin, 2022. Aberdeen Profit Margin 2017-2021. [Online] Available Through.,
<https://www.macrotrends.net/stocks/charts/SLFPY/Aberdeen/profit-margins>
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