In the year to the end of June 2011, total assets under administration rose by 41% to £24.6bn with revenue also leaping up to £207.9m, a rise of 31%. The company’s underlying profit was also up by 42% at £129m, with pre-tax profit up 46% to £126m.
Net new business flows saw £3.5bn through its doors, a 6% increase on the previous year with chief executive Ian Gorham adding that since the year end, net new business and net new clients are both “significantly higher” than last year’s comparatives. New business through Hargeaves Lansdown’s own advisers was up 13% to £625m.
In terms of the future outlook, Gorham stated: “Direct business will remain core to Hargreaves Lansdown but our fee-based advice proposition presents opportunity for growth, as the regulatory and economic environment presents acute challenges to other firms in the financial advice sector.”
Away from markets and the wider economic challenges, new regulation in the form of the Retail Distribution Review will impact its business but Gorham is upbeat about any changes being positive.
“We have previously stated that we consider ourselves already materially compliant with the advisory part of the reforms. These changes should hold opportunity, both for expansion of our advice business and increased interest in direct investment. Our view on this element of RDR remains positive.
“The platform paper issued by the FSA on 1 August 2011 represented a potential significant U-turn in its position on payments to platforms by fund groups and posed more questions than answers. While we are disappointed that this part of the FSA’s work is not yet clearly resolved, we are confident that we will be able to adapt as a business to meet any regulatory requirements whilst maintaining a clear focus on client service and on the success of our business. There is substantial water to go under the bridge in this debate.
