Novia braces for 'third era' of platforms as earnings climb 31%

Novia braces for 'third era' of platforms as earnings climb 31%
Novia's chief executive, Patrick Mill

Novia has posted a 31 per cent increase in pre-tax earnings pushing the platform's profit up to £6.7mn at the end of last year, following its acquisition by private equity firm AnaCap.

In the previous year (2020), Novia had recorded pre-tax earnings of £5.1mn. 

According to its annual financial results, published today (June 28), under chief executive Patrick Mill the business has been preparing the ground for what it says is a “third era for platforms”.

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“These next-generation platforms will bring superior, adviser-centred technology and customisation to the market,” said Mill.

“Our ongoing investment in technology, operations and support functions is in anticipation of being one of the leaders of that third wave.”

Novia added £522mn in client assets to its platform last year, edging up by 6 per cent to £9bn at the end of 2021.

The platform’s owner Anacap also houses fellow platform Wealthtime - the name which will be used from the second half of this year to refer to Novia too - and discretionary fund manager Copia Capital.

Combined, Novia and Wealthtime had some £11.8bn of pension and investment assets under administration at the end of March, with Novia holding £9.3bn and Wealthtime holding a lesser £2.5bn.

Across the two platforms, which will separate following the rebrand, the business serves some 77,000 clients.

In its results today, Novia also noted that revenue had risen to £27.8mn in 2021, up 14 per cent on the previous year's figure of £24.3mn.

Mill said the platform is currently investing for growth. Clients of Amber Financial Investments, another of Anacap’s acquisitions, have been migrated to GBST, Novia’s platform technology.

Since AnaCap’s acquisitions of the Novia, Wealthtime and Amber platform businesses, the private equity firm said in Novia’s results it has undergone a “transformation”.

“New winners will emerge, and we believe we have the right technology model to capitalise on these changing market dynamics to deliver continued robust growth in 2022 and beyond,” said Mill.

In April, chief commercial officer Barry Neilson set out Novia’s technology strategy. He said the platform was banking on a microservices strategy to ensure it does not have to employ more administrators in order to scale.

Following an overhaul of its management team, Novia is now focused on building layers of microservices on top of its core bookkeeping technology. 

The platform has already added a capital gains tax calculator, but over the next year Novia envisions housing an “ecosystem” of microservices.