Star investor Terry Smith’s payday falls to seven-year low of £31m as fund assets fall
Billionaire Terry Smith has taken home his smallest pay package in seven years due to a decline in profits at his firm, Fundsmith investment management.
He received a £31m payday on Monday, according to an analysis of Companies House records, first reported by Bloomberg.
Smith is one of the UK’s most successful stockpickers and has lived in Mauritius for the last decade. Fundsmith Equity, his flagship product, is Britain’s largest retail equity fund.
Profits at the Fundsmith management company slid to around £50m in the year to the end of March, down 14 per cent from a record £58.2m the year before.
The amount of this profit given to the member with the largest entitlement, believed to be Smith, slipped to £31.2m from £36.4m in 2022.
Assets under management fell eight per cent to £36.4bn from £39.5bn “as a result of performance and net redemptions,” the firm said.
Fundsmith’s flagship equity fund manages £23bn and has returned more than 500 per cent since 2010, but experienced its first annual slowdown in over a decade last year. The firm’s flagship fund, lost 13.8 per cent in 2022, compared to a decline of 7.8 per cent for its benchmark, the MSCI World Index (in sterling).
However, Smith is likely to have received a further payout as a result of his stake in a Mauritian company, Fundsmith Investment Services Limited, that charged the British firm £185.7m during the year.
Smith established Fundsmith in 2010 and was named Morning Wire‘s investor of the year in 2022.
His firm is one of many asset managers being squeezed by higher interest rates and international conflict in recent times.
Morning Wire has approached Fundsmith for comment.