TIDMHL.
RNS Number : 8225M
Hargreaves Lansdown PLC
14 May 2020
Trading update
14 May 2020
Hargreaves Lansdown plc ("Hargreaves Lansdown" or the "Company"
or the "Group") today publishes a trading update in respect of the
four month period to 30 April 2020 ("the period").
Highlights
-- Net new business of GBP4.0 billion in the period
-- Year to date net new business of GBP6.3 billion
-- Assets under administration ("AUA") of GBP96.7 billion as at 30 April 2020
-- 1,368,000 active clients, with net new clients of 94,000 in the period
-- Year-to-date total revenue of GBP448.1 million, up 13%,
supported by record dealing volumes
Chris Hill, Chief Executive Officer, commented:
"During this exceptionally volatile and challenging period,
Hargreaves Lansdown has performed strongly, adding 94,000 net new
clients and GBP4.0 billion of net new business.
We have and continue to be focused on the health and well-being
of our colleagues and their families. We are not seeking government
assistance, nor are we furloughing any employees or enacting any
redundancy programmes. I would like to thank all my colleagues for
their hard work, commitment and unwavering focus on delivering the
right outcomes for our clients throughout this period. I am proud
that their resolve and dedication has risen in response to the
challenges we are all now facing and that we have been able to
support all of our clients through a time of elevated and
unprecedented volumes of activity .
The investment that we have deliberately undertaken over the
past three years into our service, its scalability, our marketing
and our technology has enabled us to support and protect the
interests of our clients throughout the COVID-19 crisis. In these
challenging times, it is critical we can support people in managing
their investments and savings according to their desired outcomes.
Retail investors have a vital role to play in the recovery and I
would like to thank all of our clients for their continued
support.
There remains much uncertainty in the coming months and hence,
like many businesses, we cannot predict levels of new business or
client activity. However, we are confident that the strategy we
have invested in, with our focus on the needs of UK investors and
savers and delivering the highest level of client service, means
that we are well positioned to deliver continued attractive
long-term growth."
Assets under administration and net new business
GBP billion Four months Ten months
to 30 April to 30 April
2020 2020
Opening AUA 105.2 99.3
Net new business 4.0 6.3
Market movements (12.4) (8.8)
Founders transfers (0.1) (0.1)
Closing AUA 96.7 96.7
------------- -------------
The past four months have presented unique challenges for
society, governments, businesses, stock markets and investors.
Hargreaves Lansdown's strategy, business model, breadth of
proposition and focus on service have allowed us to support our
clients and colleagues through these challenges and perform
strongly. This has resulted in client engagement and activity
building through the period, particularly across the tax year-end,
in terms of net new business, net new clients and share trading
volumes.
Net new business was GBP4.0 billion during the period (2019:
GBP2.9 billion), taking year to date net inflows to GBP6.3 billion
(2019: GBP5.4 billion). This is a strong rebound from the difficult
macro and political environment for retail investment flows during
the first half of the financial year. Net new business growth was
driven by the usual factors of existing clients using their tax
allowances during the ISA season, ongoing wealth consolidation onto
our platform from existing clients and flows into our cash
management service "Active Savings", where AUA is now over GBP2
billion . This growth was further accelerated following the
significant market falls in early March, as existing clients added
money to their accounts and new clients joined Hargreaves Lansdown
to take advantage of the opportunity to invest at lower prices.
Net new clients for the period were 94,000, taking total active
client numbers to 1,368,000. Our client service, reputation and
breadth of proposition are core to Hargreaves Lansdown and were
particularly important during the COVID-19 events. As we typically
do during this period, we increased our marketing and advertising
presence, this year supplemented by a campaign centred on London
and the South-East. The campaign "Switch your money ON" was
particularly aimed at the ISA market along with overall brand
awareness. This, together with our direct digital marketing
expertise, resulted in substantial numbers of net new clients in
the period, taking year to date net new clients to 144,000. Many of
these clients are relatively new to investing and over the coming
months, we will be focused on how we can support them through a
lifetime of investing to meet their long-term desired outcomes
beyond the near term investment opportunities resulting from
COVID-19.
Falling stock markets driven by the global impact of COVID-19
have led to a negative market movement in AUA in the period of
GBP12.4 billion. There was also a withdrawal of cash by one of our
founders following a reduction in their Hargreaves Lansdown plc
shareholding earlier this year. When combined with net new business
and market movements, AUA was GBP96.7 billion as at 30 April
2020.
Revenue
Revenue for the period was GBP190.2 million (2019: GBP159.5m).
The period had two distinct phases where revenues initially
benefited from a greater level of AUA at the beginning of the
calendar year and a higher cash revenue margin. However, at the
start of March, the significant market falls caused by COVID-19 and
the subsequent emergency cuts to the UK base rate of interest
negatively impacted asset-related revenue streams. These impacts
were more than offset by significantly higher stock broking
revenues driven by record dealing activity. March and April both
saw a series of new daily records and monthly dealing levels more
than double the highs ever experienced before this period. Overall,
this has resulted in year to date revenue of GBP448.1 million
(2019: GBP395.9m), 13% higher than last year.
We do not know whether these elevated dealing volumes will
continue, but in light of the volumes seen in the period, we now
expect the full year revenue margin on shares to be in the range of
35bps to 40bps. As previously discussed, interest rate changes do
not immediately impact our net interest margin because of the use
of term deposits. Based on there being no further interest rate
changes, our guidance for the full year cash margin would be in the
range of 70bps to 75bps. As normal, we will give out revenue margin
guidance for the next financial year in our year-end results
scheduled for 7 August 2020.
Elevated levels of client acquisition, trading volumes and debit
card payments onto the platform boost revenues but also come with
associated costs. These activity-related costs will flow into the
second half of our financial year, together with our brand
marketing campaign. In addition there has been a notified increase
in the FSCS' budget for 2020/21, which will give rise to a likely
charge in this current year of between GBP12.5 million and GBP13.0
million compared to GBP6.8 million last year.
Dividend
The Board considers these to be strong trading results,
validating the Group's strategy and business model. The Group
continues to have a robust capital and liquidity position,
additionally supported by the receipt of GBP40 million Funds
Library net disposal proceeds at the end of February 2020. The
Board's current intention remains to operate its stated dividend
policy for the 2020 financial year.
Response to COVID-19
Our Colleagues
We have been focused throughout on the welfare of our colleagues
and ensuring that they can continue to deliver the levels of client
service we and they aspire to within a safe and healthy working
environment. This has seen the majority of our colleagues move to
working from home, with certain functions remaining in the office
where necessary to support clients. The office environment has
adapted to ensure that appropriate social distancing and hygiene
practices are all maintained. The investments we have made in our
service, technology and operational resilience over the past three
years have been critical to this outcome.
Our Clients
These are difficult times for our clients, with each individual
having their own concerns over the health, welfare and financial
security of themselves and their loved ones. We have done our
utmost to support them where possible, from increasing the numbers
of colleagues on phone lines, deploying more resources to
supplement our usual timely and informative market updates with
further insight and comment, enabling more and more digital
management of their affairs via mobile and website journeys and
ensuring protection of their identity and data.
Our Community
We are a firm believer in playing a positive, supportive and
leading role in our local community and that has never been more so
than now. We support our local charities through our charitable
trust, the HL Foundation, and we have stepped up this support
through this crisis particularly for NHS charities, in support of
the Bristol Nightingale Hospital and through a number of other
initiatives. Our colleagues have also stepped up with volunteering
and various fund raising activities.
Contacts:
Investors Media
James Found, Head of Investor Danny Cox, Head of Communications
Relations +44(0)7989 672071
Philip Johnson, Chief Financial Anita Scott / Nick Cosgrove,
Officer Brunswick
+44(0)7970 066634 0207 404 5959
Forward looking statements
This announcement contains forward-looking statements with
respect to the financial condition, results and business of the
Group. By their nature, forward-looking statements involve risk and
uncertainty because they relate to events, and depend on
circumstances, that will occur in the future. The Group's actual
results may differ materially from the results expressed or implied
in these forward-looking statements. Nothing in this announcement
should be construed as a profit forecast. This announcement is
unaudited. This statement should not be seen as a promotion or
solicitation to buy Hargreaves Lansdown plc shares. It should be
remembered that the value of shares can fall as well as rise and
therefore you could get back less than you invested.
LEI Number: 2138008ZCE93ZDSESG90
Assets under administration
Average AUA 4 months 3 months 3 months 2 months 4 months
(GBPbillion) to 30 April to 31 December to 30 September to 30 June to 30 April
2020 2019 2019 2019 2019
Funds 49.4 54.6 54.6 53.1 50.2
------------- ---------------- ----------------- ------------ -------------
Shares 32.5 35.4 34.6 33.3 31.4
------------- ---------------- ----------------- ------------ -------------
Cash 13.2 11.3 11.1 10.7 10.5
------------- ---------------- ----------------- ------------ -------------
HL Funds 8.2 9.2 9.3 9.4 9.1
------------- ---------------- ----------------- ------------ -------------
Active Savings 1.9 1.5 1.2 0.9 0.6
------------- ---------------- ----------------- ------------ -------------
Double count(1) (8.1) (9.1) (9.2) (9.3) (9.0)
------------- ---------------- ----------------- ------------ -------------
Total 97.1 102.9 101.6 98.1 92.8
------------- ---------------- ----------------- ------------ -------------
AUA (GBPbillion) As at 30 As at 31 As at 30 As at 30 As at 30
April 2020 December September June 2019 April 2019
2019 2019
Funds 47.9 55.9 54.2 53.8 52.7
------------ ---------- ----------- ----------- ------------
Shares 32.5 36.5 34.9 33.7 33.4
------------ ---------- ----------- ----------- ------------
Cash 14.1 11.1 11.3 10.8 10.9
------------ ---------- ----------- ----------- ------------
HL Funds 7.7 9.4 9.2 9.4 9.4
------------ ---------- ----------- ----------- ------------
Active Savings 2.1 1.6 1.3 1.0 0.8
------------ ---------- ----------- ----------- ------------
Double count(1) (7.6) (9.3) (9.1) (9.4) (9.4)
------------ ---------- ----------- ----------- ------------
Total 96.7 105.2 101.8 99.3 97.8
------------ ---------- ----------- ----------- ------------
Average AUA 10 months 10 months
(GBPbillion) to 30 April to 30 April
2020 2019
Funds 52.5 50.1
------------- -------------
Shares 34.0 31.0
------------- -------------
Cash 12.0 10.1
------------- -------------
HL Funds 8.8 9.2
------------- -------------
Active Savings 1.6 0.4
------------- -------------
Double count(1) (8.7) (9.1)
------------- -------------
Total 100.2 91.7
------------- -------------
(1) All HL Funds are held in Vantage or the Portfolio Management
Service (PMS) and are included in the Funds category of the table
with the exception of a small balance held off platform by third
parties. To avoid double counting the amount held in Vantage or PMS
has been deducted.
AUA (GBPbillion) 4 months 3 months 3 months 2 months 4 months
to 30 April to 31 December to 30 September to 30 June to 30 April
2020 2019 2019 2019 2019
Opening AUA 105.2 101.8 99.3 97.8 85.9
------------- ---------------- ----------------- ------------ -------------
Net new business(1) 4.0 0.6 1.7 1.9 2.9
------------- ---------------- ----------------- ------------ -------------
Market movements (12.4) 2.8 0.8 (0.4) 9.0
------------- ---------------- ----------------- ------------ -------------
Founder transfer(2) (0.1) - - - -
------------- ---------------- ----------------- ------------ -------------
Closing AUA 96.7 105.2 101.8 99.3 97.8
------------- ---------------- ----------------- ------------ -------------
(1) Net new business in the 4 months to 30 April 2019 includes
GBP267m of flows acquired from Witan Investment Services.
(2) Net new business excludes the withdrawal of GBP110 million
of Hargreaves Lansdown plc placing proceeds during the period that
were held by a founder.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
TSTBUGDUUXBDGGX
(END) Dow Jones Newswires
May 14, 2020 02:00 ET (06:00 GMT)
Hargreaves Lansdown (LSE:HL.)
Gráfica de Acción Histórica
De Mar 2024 a Abr 2024
Hargreaves Lansdown (LSE:HL.)
Gráfica de Acción Histórica
De Abr 2023 a Abr 2024
