Star fund manager Terry Smith scoops £190m
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Star stock picker Terry Smith pocketed an estimated £190 million as his investment firm continued to turn a profit last year
- Fundsmith generated profits of £58.2 million for the year to the end of March 2022
- This was a slight increase from the £57.7 million delivered a year earlier
- The highest paid member, believed to be Smith, received a £36.5m share of the profits
- The company charged nearly £252 million in fees from Smith’s Mauritius-based firm
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Star stock picker Terry Smith pocketed an estimated £190 million as his investment firm continued to turn a profit last year.
The 69-year-old’s business Fundsmith generated profits of £58.2m for the year to the end of March 2022, up slightly from the £57.7m a year earlier, according to accounts filed with Companies House.
Under the company’s partnership structure, the highest paid member, believed to be Smith, received a share of the £36.5million profits, up from the £35.7million paid out in 2021.
Hot: Terry Smith’s Fundsmith Investment Services is based in Mauritius
The company also revealed it was charged nearly £252 million in fees during the year from Smith’s Mauritius-based firm Fundsmith Investment Services (FIS), up from £188 million last year.
The fund manager is believed to own 61 per cent of FIS, meaning he could have collected nearly £154 million of these fees, bringing his total return for the year to just over £190 million.
A seasoned investor, Smith is also one of the most popular, with his flagship Fundsmith Equity fund managing around £23bn in savings. But despite steady profits, the group’s current fiscal year is likely to be much less favorable.
Many of Fundsmith Equity’s largest holdings include technology companies such as Microsoft, Amazon, Google parent Alphabet and Facebook owner Meta, all of which took a beating in 2022 as an industry boom came to a shocking halt due to rising interest rates and soaring inflation. Other key investments in the portfolio include consumer goods giants such as L’Oréal and Estee Lauder, as well as tobacco giant Philip Morris.
The tech carnage has hit the fund’s performance hard, with Fundsmith Equity’s share price falling nearly 14 percent last year.
Smith also shocked the investment world in September when he announced he was closing his £325 million Fundsmith Emerging Equities Trust because its performance fell short of expectations.
The move stunned the city, with one analyst saying that Smith had effectively “fired” himself from a fund that had still earned him healthy fees.
But despite the sharp downturn, Smith still seems to be interested in tech giants, with Fundsmith Equity taking a stake in Apple in November after a share price slump.
The investment was followed by a decision to dump payment firm PayPal and software group Intuit after sharp declines. Tech stocks currently make up nearly 32 percent of the fund’s portfolio.