Janus Henderson Group plc 'BBB+' Ratings Affirmed; Outlook Remains Stable


  • Janus Henderson Group plc continues to have net outflows and mixed investment performance--two factors that weigh on our assessment of the firm's business strength.
  • However, we anticipate that Janus Henderson's leverage will be 0.0x to 0.5x and interest coverage will be 27x to 29x in 2019 and 2020, levels that are clearly within our tolerances for the current rating.
  • We are affirming our 'BBB+' issuer credit rating on Janus Henderson and the 'BBB+' rating on the firm's senior unsecured debt.
  • The stable outlook reflects our expectation for the company to maintain strong credit metrics, including leverage below 0.5x and interest coverage of 27x to 29x during 2019 and 2020, even while the business continues to face challenges relating to net outflows and investment performance.
NEW YORK (S&P Global Ratings) March 15, 2019-- S&P Global Ratings said today 
it affirmed its 'BBB+' issuer credit rating on Janus Henderson Group plc. The 
outlook remains stable. 

At the same time, we affirmed our 'BBB+' senior unsecured debt rating.

Business trends at Janus Henderson have continued to be poor, and we expect 
the company to continue to have net outflows in 2019 and 2020, similar to 2018 
($18.1 billion or 5% of beginning assets under management [AUM]) and many 
previous years. In our view, Janus Henderson has suffered and continues to 
suffer from the trend toward passive management. However, we also do not 
believe that investment performance has been supportive of the company 
achieving positive organic growth. As of Dec. 31, 2018, 61% of AUM was 
outperforming its benchmark on a three-year basis, which we don't view as 
particularly strong. Additionally, while some asset classes, such as fixed 
income, have done well versus their benchmarks (88% outperforming on a 
three-year basis), they've struggled versus peers (28% in the top half of 
Morningstar peer group on a three-year basis). Multiasset continues to be a 
bright spot for the firm, both in terms of flows and performance.

The stable outlook reflects our expectation for the company to maintain strong 
credit metrics, including leverage below 0.5x and interest coverage of 27x to 
29x during 2019 and 2020, even while the business continues to face challenges 
relating to net outflows and investment performance.

We could lower the ratings if we believe that leverage will rise above 1.0x or 
interest coverage below 15x. We could also lower the ratings if the business 
meaningfully deteriorates as judged by weaker investment performance and heavy 
declines in AUM.

An upgrade is unlikely over the next two years. However, we could raise the 
ratings if the company improves its investment performance, demonstrates 
consistent organic growth, and maintains leverage comfortably below 1.0x and 
interest coverage comfortably above 15x.
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