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AJ Bell reports profit and revenue rise, warns of short-term outlook

25th May 2023 09:02

(Alliance News) - AJ Bell PLC reported a boost in interim profit and revenue on Thursday, but warned of a compression in revenue margins in the short term.

The Manchester-based provider of investment services and platforms reported a 61% rise in pretax profit to GBP41.9 million in the six months ended March 31, from GBP26.1 million in the prior year.

The company said this rise in profit was driven by a 37% boost in revenue to GBP103.6 million from GBP75.5 million the year prior.

Despite macroeconomic uncertainties, AJ Bell said its revenue increased as "customer numbers grew and interest generated on cash balances on the platform increased".

Assets under administration closed at GBP68.6 billion on March 31, up 7% from GBP64.1 billion on October 1 2022. Similarly, assets under management increased by 39% in the same period to GBP3.9 billion from GBP2.8 billion

The company said this reflected its strongly performing investment solutions that were "highly valued by financial advisers, their clients and our retail customers".

AJ declared an interim dividend of 3.50 pence, a 26% rise from 2.78p the previous year. AJ said this dividend rise reflected its financial strength and cash-generative business model.

Looking ahead, the company expects full-year revenue margins to be similar to those achieved in the first half.

However, the company noted that the macroeconomic environment remains challenging for short-term retail investors, and so expects a slight compression in revenue margins in the next year.

"This breadth of offering, combined with higher service standards and competitive charges, positions us well to continue attracting new customers and assets to our platform and further increase our market share," said Chief Executive Officer Michael Summersgill.

Shares in AJ Bell were down 0.5% at 311.40 pence in London on Thursday morning.

By Will Neill, Alliance News reporter

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