Hargreaves Lansdown has reported record net new business and net new active client numbers for the 1 July to end of September.
In a trading update issued today (14 October), Hargreaves Lansdown reported net new business inflows of £1.43bn for the quarter, up 47 per cent on the same period last year, and total active client numbers rose by 24,000.
Total client numbers now total 760,000 at the Bristol-based business but the period also saw assets under administration decrease by £0.5bn in the three months to 30 September 2015 to £54.7bn, compared with £55.2bn in June 2015.
Ian Gorham, chief executive of Hargreaves Lansdown, said: “We are particularly pleased with the reported trading data for the first quarter of the financial year given lower stock markets and weakness in investor confidence during the period.
“During the quarter, the FTSE All Share index fell by 6.57 per cent to 3335.92, driven primarily by concerns about the Chinese economy.
“These stock market falls meant that despite record new business in the quarter, overall AUA fell by £0.5bn to £54.7bn.”
The trading update showed much of Hargreaves Lansdown’s income is now recurring, derived from fees based on client assets.
This means lower stock markets can reduce income.
However, revenue during the period still grew by 11 per cent, to £78.5m, driven primarily by strong growth in year on year assets, and to a lesser extent increased equity dealing volumes.
Client and asset retention rates continue to be at 94 per cent and 93.7 per cent for the quarter, above the 93.4 per cent and 92.7 per cent respectively seen in the last financial year.
Looking ahead, Mr Gorham said early indications suggest considerable interest in next year’s Lloyds share sale.
He said: “A sizeable number of people buy their first ever share via an IPO, and retail share offers are therefore very important in encouraging the UK public to invest.
“As ever, future stock market levels and investor confidence will have a significant part to play during the remainder of our financial year. However, we remain confident of growing the business further to the benefit of our clients and shareholders.”
emma.hughes@ft.com
