ROBECO ANNUAL REPORT 2003:

Robeco was able to record a substantial increase in net profit in 2003, which grew by 48% from EUR 70.6 million in 2002 to EUR 104.4 million. The main contributors were the prosperous alternative-products business and the cost reductions resulting from a strategic restructuring. The success of alternative products confirms the strategic path which is based on offering multiple complementary investment capabilities that do well in various economic climates. As a result, assets under management increased over the full year, helped by positive investment results from the second quarter onwards. The traditional profit base of retail mutual funds and institutional segregated mandates is diminishing in relative weight, favoring the increased contribution of the alternatives business.

 

The full-year consolidation of the 60%-interest held in Boston Partners had a positive effect on the result. As a result of the strategic restructuring efforts the expenses were already reduced in 2003, although this is largely offset by a one-time restructuring charge. By hedging the US-dollar exposure, the resulting deterioration in profitability from the depreciation of the US-dollar could be limited.

 

The assets under management increased by EUR 8.9 billion to EUR 108.2 billion. Both a positive investment result and net cash flow contributed to the increase. The investment result includes a negative effect of EUR 6.5 billion from the weakening of the US dollar versus the euro. Robeco was able to record substantial net cash flow, representing actual money invested by clients, amounting to EUR 3.8 billion. Fee-generating additions to the asset base resulting from leveraging money received from clients contributed EUR 2.3 billion to the increase in assets under management.

 

Robeco's assets under management are mainly derived from institutional clients, which represent 59% of all assets. With EUR 44 billion in retail assets (41% of total assets), Robeco is one of Europe's largest retail asset managers. Robeco has 36% of all assets managed in the US. The US-managed assets have decreased in relative weight, due to the weakening of the US dollar versus the euro.

 

Robeco's position as an alternative-asset manager has been further developed with concrete results: assets under management in alternatives increased from EUR 7.8 billion to EUR 11.9 billion. The alternative assets are managed by investment professionals in both the US and Europe. In 2003, Robeco's structured products were in great demand, especially with higher-end retail clients. CDO's and capital guaranteed products with upside yield potential through investments in hedge funds were placed successfully. Also the hedge-fund business grew substantially, with new assets raised in both the fund-of-hedge-fund products as well as the managed-futures hedge fund managed by Transtrend.

 

Robeco provides discretionary asset management products and services, as well as a complete range of mutual funds to a large number of institutional and retail clients worldwide. Robeco's product range encompasses fixed-income and equity investments, as well as balanced accounts, money-market funds and alternative investments.

 

Robeco distributes its funds for the retail market directly, and through other financial institutions. Several of its mutual funds, including the flagship Robeco N.V., are listed on major European stock exchanges such as Amsterdam, Paris, Frankfurt and London.

 

As well as from its head office in Rotterdam, Robeco services its clients from its European offices in Belgium, France, Germany, Spain and Switzerland. In the United States, Robeco has offices in New York, Chicago and San Francisco (Weiss, Peck & Greer), Boston (Boston Partners), White Plains (Sage Capital Management) and Toledo (Harbor Capital Advisors), and in the Middle East in Bahrain.

 

Robeco is the center for asset management with full operational independence within the Rabobank Group. The combination of the highest credit ratings from the major international rating agencies and the highest Sustainability Cluster Score within the banking sector reflects the high added value Rabobank has always offered its investors, members, clients and employees.

 

 

The complete annual report, as well as a summary, can be found on robeco.com (About Robeco > Organisation > Facts & figures).