29th Jan 2019 08:06
LONDON (Alliance News) - Financial services firm Hargreaves Lansdown PLC on Tuesday reported a fall in assets, though profit and its dividend both increased.
As of the end of December, the FTSE 100-listed company's assets under administration fell 6% to GBP85.9 billion from June 30. On a year-on-year basis, assets under administration declined 0.2%.
However, Hargreaves Lansdown did achieve growth in client numbers, by 45,000 to 1.1 million, and net new business inflows were GBP2.5 billion, but this was down 24% year-on-year.
"External market conditions have impacted investor confidence and driven industry-wide net outflows over this short reporting period," said Chief Executive Chris Hill.
"This includes our own UK measure of investor confidence, which is at its lowest point since the index was launched in 1995. The Investment Association has reported the worst period for industry net retail fund outflows ever over the three months to November 2018."
Hargreaves Lansdown's net revenue climbed 9% to GBP236.4 million, while pretax profit increased 4% year-on-year to GBP153.4 million.
The firm is paying a 10.3 pence interim dividend, increased 2.0% from 10.1p paid a year prior.
Hargreaves Lansdown said this reflects its confidence in its financial position and its business model, and it remains "committed" to paying special dividends when it has sufficient extra cash.
"The diversified nature of Hargreaves Lansdown has enabled us to continue growing despite a period of geopolitical uncertainty, market volatility and weak investor confidence," added Hill.
"We have a significant long-term market opportunity and our recent investment in service and developing our proposition are bringing real benefits to the business and our clients, both in difficult times such as the present and as and when conditions improve."
Looking ahead, Brexit will continue to weigh on markets and consumer confidence until the uncertainty is resolved.
Its second half is traditionally stronger than the first, Hargreaves Lansdown continued, but it said Brexit uncertainty "is clearly not helpful".
"Irrespective of this short term volatility in markets and the impact on consumer confidence, the long-term growth and structural opportunity in the UK savings market continues to excite us," said Hill.
"We believe our platform and investments position us well to capture this growth and deliver long-term growth for our shareholders."
Shares in Hargreaves Lansdown were 3.6% lower at 1,731.50 pence on Tuesday.
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