28th May 2019 09:47
LONDON (Alliance News) - Wealth manager AFH Financial Group PLC on Tuesday reported a sharp rise in first half profit and funds under management as the company reiterated its medium-term guidance.
In the six months to April 30, AFH Financial saw its pretax profit almost double to GBP6.0 million from GBP3.2 million for the same period a year prior.
Revenue increased 61% to GBP36.6 million from GBP22.7 million a year before. AFH said its recurring fees increased 69% compared to a year before in its Financial Advisory & Investment Management division. The division generates 80% of group revenue.
AFH Financial's administrative costs, before amortisation & depreciation and share-based payments expenses, increased 54% year on year to GBP11.9 million from GBP7.7 million. The increase was attributed to further spending on digital marketing.
The wealth manager's funds under management at April 30 stood at GBP5.38 billion, up 22% from GBP4.40 billion at November 1 and up 68% from the same time last year.
In the first half, AFH Financial saw GBP640 million of inflows through acquisition and GBP220 million of inflows from its existing businesses. During the period, the company completed four acquisitions.
Market movements added GBP160 million in the period. The company experienced GBP40 million of outflows and drawdowns.
"I am pleased to report another set of strong results for the first half of 2019 demonstrating our progress as we continue to build ourselves into the leading financial planning-led wealth manager in the UK. Despite turbulence in the equity markets and subdued investor confidence over the period, we have delivered increased revenues,and improved trading margins demonstrated by our underlying earnings before interest, tax, depreciation and amortization margin increasing to 21.0%," said Chief Executive Alan Hudson.
AFH re-confirmed its three-to-five year targets. The company is targeting GBP10 billion funds under management, GBP140 million revenue per annum, and an underlying Ebitda margin of 25% on revenue.
Hudson added: "The overarching strategy of the company continues to be to generate long term value for shareholders by driving revenue growth and margin expansion while providing exceptional value and service to our clients, using our increasing size to drive down platform and fund management charges aligned to an appropriate risk-based investment model.
"On the basis of our results and the opportunities identified, we look forward to continuing to deliver continued profitable growth in the second half of 2019 and beyond."
Shares in AFH Financial were up 8.6% Tuesday morning at 337.70 pence each.
Related Shares:
AFHP.L