Invesco to Cut Compensation Costs With $200 Million Savings Plan
(Bloomberg) -- Invesco Ltd. plans to curtail spending on employee compensation as the asset manager aims to save $200 million annually by the end of 2022.
As much as 60% of the expected savings will come from compensation, executives said Tuesday on a conference call to discuss third-quarter results. About $150 million of the expense reductions will occur by the end of next year.
“It is primarily realigning our workforce to lower-cost locations and reallocating and reorganizing across our business to make sure we’re investing in our highest capabilities,” Chief Financial Officer Allison Dukes said on the call.
Shares of Invesco climbed 3.6% to $14.29 at 11:08 a.m. in New York. The stock had dropped 23% this year through Monday.
Invesco, with about 8,700 employees, is facing long-term challenges as consolidation among asset managers squeezes fees. Nelson Peltz’s Trian Fund Management built stakes in Invesco and rival Janus Henderson Group Plc as the activist investor pushes for more industry mergers.
Net inflows into long-term investment products at Atlanta-based Invesco totaled $7.8 billion in the third quarter, compared with net outflows of $11.1 billion in the same period a year earlier. Invesco manages about $1.2 trillion of assets.
Invesco posted adjusted earnings of 53 cents a share, beating the average estimate of 48 cents by analysts in a Bloomberg survey. Revenue of $1.5 billion matched estimates.
©2020 Bloomberg L.P.