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(HL) Hargreaves Lansdown General Share Chat

Discussion in 'General Share Chat' started by Microem1, Nov 10, 2015.

  1. Microem1

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    (HL) Hargreaves Lansdown General Share Chat
     
  2. Groucho

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    Trading update

    11 October 2018


    Hargreaves Lansdown plc ('the Group') today publishes a trading update in respect of the three month period to 30 September 2018 ('the period').


    Highlights


    · Net new business of £1.3 billion in the period

    · Net new clients of 29,000

    · Assets under administration ("AUA") of £94.1 billion as at 30 September 2018, up 3% since 30 June 2018

    · Net revenue for the period of £120.8 million (2017: £104.1 million), up 16%


    Chris Hill, Chief Executive Officer, commented:


    "I'm pleased to report a solid start to our financial year for growth in clients, net new business and revenue. The past quarter has seen an uncertain market environment and weak investor sentiment resulting in an industry-wide slowdown in net retail flows. Despite this backdrop, we believe the strength of our business model positions us well for when sentiment improves."


    Assets under administration and net new business
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    Net new business of £1.3 billion for the period was driven by continued investment in our digital marketing presence, higher client numbers and ongoing wealth consolidation onto our platform. During the period, we also added three further banks to our cash marketplace service, Active Savings, enabling clients to manage their cash more easily at attractive rates of interest. As a result, we increased the level of marketing and promotional activity in early September and now have over £100 million managed by clients in this service. AUA rose to £94.1 billion as at 30 September 2018 due to net new business and positive market movements.


    We welcomed 29,000 new clients in the period (Q1 18: 30,000), taking active client numbers to 1,120,000.


    Net revenue

    Net revenue for the period was £120.8 million, up 16% on last year, benefitting from higher AUA levels due to net new business and market growth.

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  4. Groucho

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    29 January 2019

    Hargreaves Lansdown plc

    Interim results for the six months ended 31 December 2018


    Hargreaves Lansdown plc ("HL" or "the Group") today announces interim results for the six month period ended 31 December 2018.


    Highlights

    · Net new business of£2.5 billion.

    · Assets under administration down 6% since 30 June 2018 to£85.9 billion.

    · 1,136,000 active clients, an increase of 45,000 since 30 June 2018.

    · Profit before tax increase of 4% to£153.4 million.

    · Interim dividend up 2% to10.3 penceper share (H1 2018: 10.1p)

    Chris Hill, Chief Executive Officer, commented:

    "The diversified nature of Hargreaves Lansdown has enabled us to continue growing despite a period of geopolitical uncertainty, market volatility and weak investor confidence. 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."

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    Analyst presentation

    Hargreaves Lansdown will be hosting an analyst presentation at 9.00am on 29 January 2019 following the release of these results for the half year ended 31 December 2018. Attendance is by invitation only. A conference call facility will be in place with the following participant dial-in numbers - UK (toll free) 0800 640 6441, UK (local) 020 3936 2999 and all other locations +44 20 3936 2999. The participant access code is 762014. Slides accompanying the analyst presentation will be available atwww.hl.co.uk/investor-relationsand an audio recording of the analyst presentation will be available by close of business on the day.

    The Interim Results contain forward-looking statements which have been made in good faith based on the information available to us at the time of the approval of this report and should be treated with caution due to the inherent risks and uncertainties, including both economic and business risk factors some of which were set out in the 2018 Annual Report, underlying such forward-looking information.

    Unless otherwise stated, all figures below refer to the six months ended 31 December 2018 ("H1 2019"). Comparative figures are for the six months ended 31 December 2017 ("H1 2018"). Certain figures contained in this document, including financial information, have been subject to rounding adjustments. Accordingly, in certain instances the sum of the numbers in a column or a row in tables contained in this document may not conform exactly to the total figure given for that column or row.



    Chief Executive's Statement


    External market and opportunity

    Geopolitical developments abroad and at home have resulted in a year of significant uncertainty and volatility not only for financial markets but also for our clients. Through this period, Hargreaves Lansdown has continued to grow and has maintained its focus on client service and developing our proposition.

    The market opportunity for Hargreaves Lansdown remains significant, extending across £1.0 trillion of addressable investment assets within the private wealth market and up to £2.4 trillion when cash savings are also included. People need to take charge of their money and manage it over a longer period and yet savings and investments are becoming more complicated. Clients therefore need help and want solutions more than ever before. They want to feel valued and supported by their chosen financial service providers, particularly during these uncertain times. Our relentless client focus, combined with our scale, knowledge and expertise uniquely positions us to provide the solutions required and capitalise on this opportunity.

    With this opportunity, and in order to serve the needs of our clients, we continue to invest in our stated strategic agenda and in continuous improvements to our service in order to maintain our leading client and service proposition. Of course, we remain cognisant of balancing our levels of investment and strategic priorities at levels appropriate to the external environment and client activity levels but, for now, it is business as usual.

    Growth and service

    We believe it is critical that we continue to invest in opportunities for growth during difficult times if we are to capitalise on our significant long-term market opportunity. This ensures that we are as well placed as possible to take advantage of better market conditions and improved confidence levels as and when they arise, just as we saw following the Brexit referendum. We remain focused on investment to support higher levels of client activity, deepen our marketing skills, improve our technological development capacity and broaden our offering, all whilst maintaining compliance with regulatory change. Following a period of elevated cost growth to position us for this market opportunity, we are now moderating the rate of investment and remain watchful about the rate we put new costs into the business whilst market conditions remain challenging.

    We have maintained a visible brand and marketing presence during this period and retained the headcount resources to deliver the levels of client service that we aspire to. We have also extended our opportunities for growth should these conditions persist for longer, for example through direct book transfers and the development of our cash marketplace proposition, Active Savings.

    External market conditions have impacted investor confidence and driven industry-wide net outflows over this short reporting period. 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. For Hargreaves Lansdown, whilst these conditions meant that AUA fell 6% to £85.9 billion (30 June 2018: £91.6bn) due to negative market movements of £8.2 billion, we were pleased to welcome a further 45,000 net new clients, taking our total active clients to 1,136,000, and deliver net new business inflows of £2.5 billion.As discussed last year, we benefited from elevated transfer levels and new clients following service issues at a competitor platform in the comparative period of H1 2018.

    This progress demonstrates that the investment we are making continues to pay off and we believe positions us well for when conditions improve. Whilst market share data is slow to emerge, we believe we have continued to maintain our leading position in our chosen areas. For example, it is pleasing to see that whilst dealing volumes for the industry across the period have been subdued, we have managed to increase our share of the execution only stockbroking market to 31.9% (source: Compeer Q3 Benchmarking Report).

    We look to develop a lifelong relationship with all our clients, and hence retention and satisfaction are key measures for us. The client retention rate has remained very high at 93.5% during a period where client numbers, transactions and contacts have all increased. Investment into our Helpdesk and Operations teams through increased training, use of technology and better management techniques has helped to elevate client satisfaction levels. Improved call answering, email response rates and quicker completion of transfers are just some of the tangible benefits coming through. Consistent focus on such client service measures gives us greater insight into client expectations and service levels and helps determine where we invest and deploy resources.

    Delivering value for clients

    Our excellent client service needs to be matched with an outstanding client offering. Back in December 2017 we soft launched Active Savings, our cash management service. In the following months we developed the proposition further, adding more banks and improving the rates on offer. In September 2018, we increased the level of marketing and promotional activity, believing it to be strategically imperative to capture the scale advantage of being a first mover for the long-term benefit of our clients, the banks on the platform and our shareholders. We are therefore currently focused on growing AUA. Our chosen route for achieving this in the current low interest rate environment is via reducing our revenue margins to ensure the rates offered on Active Savings are highly competitive. This will attract the new clients and assets into the service that we need to capitalise on this opportunity. We are pleased with the growth we have seen in the last four months from a standing start as a consequence of this approach. At a time when investment products have not been favoured by consumers, having a leading cash savings solution is a great benefit to clients and diversifies our product offering. Rates on offer across the range of maturity terms are now consistently top quartile, with several products at the top of interest tables and, as at 31 December 2018, AUA had grown to £385m across over 13,000 client accounts.

    Whilst Active Savings has been gaining traction we have been busy on the next stages of development. The ability to hold and manage cash through our platform and receive a competitive rate of interest, should prove very appealing during uncertain times for investors and we will look to add an easy access account shortly. We are also looking forward to welcoming new clients from Witan Investment Services following their announcement to withdraw from administering their retail Investment Trust Savings and ISA Schemes. The deal could involve the transfer of up to 16,000 retail clients, representing up to £420 million. This is the seventh such transaction we have undertaken and once again demonstrates our ability to provide the best solution for fund managers and the best value for their clients.

    Putting clients first is at the heart of our culture and it is always pleasing when our proposition and service scores highly in independent research. In November, Platforum issued their UK D2C Investor Experience report which looks at the customer experience of investing in 2018 and how it has evolved over the past year. Hargreaves Lansdown scored top marks in all the online proposition categories, for its mobile proposition, and customer service. Only on pricing did we not score top marks, but we continue to offer an excellent value proposition for our clients with fund discounts and low costs to hold shares and investment trusts. In the coming months, we are also expecting the final outcome from the Financial Conduct Authority on their Investment Platform Market Study which we hope will help deliver overall benefits to the consumer.

    A year ago we rebranded our content and platform to create a new, clean visual identity. This has enabled us to tailor our look, feel and tone of voice when we interact with groups of clients. Much work has been done in segmenting our clients so that we can increasingly personalise content and guidance in communications to them and this is now delivering improved conversion rates on marketing campaigns. New names to our marketing list in the period are higher than last year, driven by share related content through third party online channels. Given the environment, converting these leads is the next challenge but we won't hold back on marketing despite investor uncertainty. It is times like these that clients and potential new investors need clear and concise communications giving them the confidence to make the right investment decisions for their future benefit.

    Many improvements to our service are born from listening to the needs of different groups of clients and analysing their activity. Our newly launched Wealth 50, a shortlist of our experts' favourite funds, is a prime example of this. We spoke to over 6,000 existing and potential clients, undertook 12 surveys, discussed with focus groups and conducted a number of one-on-one and user-experience sessions. Their insights guided us to replace the Wealth 150 with a simpler more focused list of funds across a range of sectors and its launch gave us the opportunity to renegotiate with the fund managers who made our shortlist. Many of the funds on the list are now available with even bigger discounts on their annual fund charges. All such discounts are to the sole benefit of clients, and not to Hargreaves Lansdown in any way. Since its launch, the Wealth 150 has outperformed its benchmark by 5.8% and sector by 11.8% and clients will now save an average of 30% on a Wealth 50 fund's annual ongoing charge because we have used our collective buying power to secure them a better outcome. We believe that the total cost of owning funds via Hargreaves Lansdown is now even more competitive, particularly when compared to traditional advice channels. Overall this creates a truly compelling value proposition when combined with the excellence of our investment research, breadth of our offering and service delivery.

    Dividend

    The Board believes the Group has sufficiently strong profitability, liquidity and capital positions to execute its strategy without financial constraints and to operate a sustainable and progressive ordinary dividend policy. We remain confident in our business model and the Board has declared a 2% rise in the interim dividend to 10.3 pence per share. The Board remains committed to paying special dividends when sufficient excess cash and capital exist after taking account of the Group's growth, investment and regulatory capital requirements at the time.

    Outlook and Brexit

    Brexit is on the horizon, and until certainty is reached, it will continue to impact markets and consumer confidence. Financial decision making becomes trickier and clients can become reluctant to invest more in volatile markets and prefer to sit on the side-lines. As we have done already, throughout the whole Brexit process, we will keep clients updated on our views, potential scenarios and impacts. We will also ensure that we have sufficient resources in place in order to help clients at the critical moments. For many clients, however, their investment goals are long-term and they remain willing to invest and look to us for guidance in such times. We will continue to deliver tailored content that will help empower them with the confidence to make appropriate investment decisions for their future.

    The second half of our trading year is traditionally our stronger half for new business, including as it does the tax year-end, which acts as a natural incentive for clients to use tax allowances. Investor sentiment and stock market levels are usually key to the levels of new business but this year has the added complication of Brexit. Such uncertainty during our busiest time of year is clearly not helpful for predicting new flows and business volumes, but we will be prepared operationally to deal with any outcome. Our fundamental objective will be to ensure continuity of service and a seamless client experience throughout the Brexit process and, as ever, over the busy tax year-end.

    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. We believe our platform and investments position us well to capture this growth and deliver long-term growth for our shareholders.

    I would like to thank our clients for their continued support and recommendation and I would also like to recognise my colleagues for their hard work and commitment. All these improvements to our client service and proposition would not be possible without the immense contribution from our talented and diverse population of employees. We continue to focus on attracting, developing and retaining outstanding people, embedding our client driven culture, improving employee well-being and providing training programmes to ensure we have a strong talent pipeline of people who can deliver our future strategic goals, thereby underpinning our future growth.


    Chris Hill

    Chief Executive Officer

    Hargreaves Lansdown - Half-year Report @HLInvest https://www.voxmarkets.co.uk/rns/announcement/26b6ce21-d2a9-497e-a6c9-9bd445ea889d

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    Last edited: Jan 29, 2019
  5. Groucho

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    Sunday Times 26/5/19
     

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    Sunday Times 23/6/19
     
  7. Groucho

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    08 August 2019

    Hargreaves Lansdown plc


    Results for theyear ended 30 June 2019



    Highlights:

    · Net new business of£7.3 billion

    · Strong growth in Assets Under Administration, up 8% to£99.3 billion

    · 1,224,000 active clients, an increase of 133,000 in the year

    · Profit before tax increase of 5% to£305.8 million

    · Total dividend up 5% at 42.0 pence per share

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    Chris Hill, Chief Executive Officer, commented:

    "We are pleased with the underlying strength and resilience of our business and our increase in market share. We continue to focus on our clients' evolving needs and where we see opportunities for growth. We now have a record 1,224,000 clients and Assets Under Administration (AUA) of£100 billion.

    The second half of the financial year was particularly strong, supported by our best ever tax year end with clients continuing to use their ISA and SIPP allowances. Our Active Savings launched with a full tranche of term deposits and through considerable momentum, now has over£1bnAUA. Our HL Select Global Growth Shares fund now has over£350 millionAssets Under Management and is our most successful Select fund launch to date.

    I have apologised to all clients who have been impacted by the recent problems around the Woodford Equity Income Fund, because we all share their disappointment and frustration. In these difficult times we recognise the financial and personal impact the gating of the fund has had on them. Our priority is to support them, keep them informed and ensure that the fund reopens as soon as is practicable.

    We recognise that there are industry headwinds, but we continue to execute our strategy and remain on track. We are confident that we are well placed to help our clients prosper, whilst continuing to deliver strong and sustainable returns for shareholders."



    Chief Executive's Review


    Continued execution of our strategy

    2019 saw Hargreaves Lansdown continue to execute our strategy. We delivered strong growth, increased market share and maintained our focus on clients' evolving needs and the service we provide.

    Net new business was £7.3 billion and we welcomed a further 133,000 net new clients. We now have a record 1,224,000 clients. I am also pleased to report that AUA exceeded £100 billion for the first time in July 2019. We take great pride in what we do and I am confident that we are well positioned for the future.

    This growth came despite external challenges, including uncertainty over Brexit and the wider macro-economic outlook. Investor confidence was understandably volatile in the UK market overall and, by our own measures, it hit record lows in the second half of 2018 with the Investment Association reporting the worst quarter ever for net retail fund outflows in Q4 2018.

    Our growth and the resilience of net new business reflects the execution of our strategy and our relentless focus on putting the client at the centre of all that we do. The second half of our financial year was particularly strong, driven by a number of ongoing diversification initiatives that broaden our accessible market and by improved marketing effectiveness. This contributed to our best ever tax year end as clients continued to use their ISA and SIPP allowances.

    We continue to develop new and innovative products and services where there is client need. Our new Active Savings service has gained considerable momentum and made a significant contribution to growth. Its AUA went above £1 billion in early July. We launched the HL Select Global Growth Shares fund in May 2019, with £298 million placed ahead of the launch. We were also delighted to welcome new clients from Witan, JP Morgan and Baillie Gifford during the year, continuing our successful history as a provider of choice for organisations wishing to transfer direct books. These books contributed £1.2 billion.

    Due to this growth and our diversification initiatives, we have continued to add market share. We have grown our share of the direct to consumer platform market to 40.5%1 and increased our share of the execution only stockbroking market to 34.1%2.

    I would like to thank our clients for their continued loyalty and support. Our relationship with them is based on a desire to help them to save and invest with confidence and build for their long-term prosperity and our strong retention rate of 93.6% is a demonstration of our strong service performance.

    The hard work of colleagues is behind all that has been achieved and I would also like to thank them for their dedication and resilience throughout the year.

    Serving our clients

    We have a significant opportunity in an evolving and growing market. Societal changes such as improving life expectancy, the transfer of long-term savings from companies to individuals, and a prolonged low interest rate environment offering minimal risk-free returns all require that individuals and families build their own wealth and capital. This is against a backdrop of ever-shifting regulatory and tax environments. In this complicated world, our clients need support more than ever.

    Our business grows as we add clients then deepen our relationship with them. We aim to develop this throughout their financial lives as they save and invest to accumulate before moving into a decumulation phase in retirement. By providing the service and solutions that they need, when they need them, engaging with them at the right times and communicating in the ways they prefer, we optimise the value that we can bring to them.

    We have worked hard this year on the areas that our clients tell us cause them inconvenience, such as transfers, where we have reacted by facilitating higher numbers of online transactions and a reduction in overall completion times. We have improved our Helpdesk service by responding to high volume call drivers, providing new training to managers and through deployment of technology tools. We have also maintained our marketing efforts through quieter periods of client activity. It is through uncertain times that clients seek knowledge, information and our insight more than ever.

    Given all of the hard work and resource we put into service, I was delighted that Hargreaves Lansdown received top marks from Platforum in its November 2018 UK D2C Investor Experience report for customer service, as well as for our online and mobile propositions. We also won the Boring Money Best Customer Service award, sponsored by The Times and The Sunday Times. We have achieved records in our internal measures for client satisfaction with our Helpdesk and improved our performance in Operations, whilst at the same time improving efficiency.

    At the heart of our business is an extensive and complex technology infrastructure. We ensure that the monitoring and maintenance of our systems is thorough and rigorous to ensure that client information is always safe and secure and our hardware, software and client portals enable a smooth and efficient experience. This year we have delivered a number of key projects that have improved our ability to handle electronic trading volumes and to make our back office systems and websites work faster. We also completed changes to the way our clients log into the platform, making the process simpler and safer. Throughout all of these changes, platform uptime has been maintained and we have made enhancements to capacity and responsiveness of core applications.

    Investing for the future

    A key part of maintaining a lifelong relationship with clients is to provide a home for their assets not only throughout their lifetime, but through the market cycle. To that end, we continue to invest in our proposition. Our research told us that clients wanted to manage their cash savings as well as their investments all in one place with simple switching and easy execution. We therefore "soft" launched our cash management service, Active Savings, in December 2017 and spent some time to get the proposition right, adding more banks and making sure that the rates on offer were the best they could be.

    We launched with a full tranche of term deposits and a focus on growing AUA in September 2018. In order to achieve this and establish a leading presence in this market, we have reduced our revenue margins to make sure that the rates we can offer on the platform are competitive. We followed this up by introducing Easy Access in January 2019. We have been pleased with the growth that we've seen this year which has taken us to almost £1 billion of AUA as at 30 June 2019. Our rates continue to be among the best available to the 28,000 clients who have opened accounts and we are committed to maintaining top quartile rates.

    Through the uncertainties of 2018, clients indicated a desire to invest in global funds and this continued into early 2019. We therefore launched the HL Select Global Growth Shares fund in May 2019.

    This now has over £350 million of AUM, our most successful Select fund launch yet. It is a high conviction fund that will typically hold shares in 30-40 companies and is actively managed by our experienced team in Bristol. We are committed to transparency and engagement with fund holders, so for all our HL Select funds we publish every shareholding once dealt, as well as the complete portfolio breakdown and regular updates on performance.

    As Hargreaves Lansdown grows, it is paramount that we invest so that we continue to provide the very best service to our clients and develop capabilities to maximise the significant long-term market opportunity. By continually developing our people, technology and marketing capabilities we believe we will nurture the trust, engagement and ease of doing business that is critical to our success.

    The Wealth 50

    Behavioural economics suggest that when people are presented with a wide or unfamiliar choice, for example about financial planning, this can result in them not making any decision at all. One tool that people can use when making investment decisions is 'best buy' lists. In their Investment Platforms Market Study, the FCA found that 'best buy' lists and/or model portfolios help investors pick independent well-performing funds.

    We are committed to a favourite funds list as one of many tools which are important for our clients.

    At Hargreaves Lansdown, we have had a favourite funds list since October 2003. This is now known as the Wealth 50 following its relaunch in January 2019. This was as a result of feedback from 6,500 current and potential investors who told us they wanted a shorter, more focused list with the ability to filter by objective, risk, yield and cost.

    The process of selecting and reviewing the Wealth 50 constituents is a rigorous one driven by our 14 person investment research team. They devote thousands of working hours every year to conducting quantitative and qualitative analysis of fund managers and the funds. This process helps identify managers who have added value over the long-term through repeatable skill rather than market movements or thematic biases.

    This research has resulted in the selection of funds which have on average outperformed both their relevant benchmark index and their sector average after charges, by 5.8% and 11.8% respectively over the period they have been on our favourite funds list.

    It is important to note that Hargreaves Lansdown is paid directly by our clients, not by fund managers. Our fee income is calculated as a percentage of the clients' assets held on our platform, and we earn the same fee regardless of the funds our clients hold.

    We use the combined buying power of our 1.2 million clients to get the lowest cost we can for each fund, as a lower price delivers better investment returns. These discounts are passed in full to our clients. In 2018, we saved our clients £61 million of fund management costs as a result of the terms we have negotiated on their behalf and the Wealth 50 relaunch has enabled us to deliver a further £7 million of discounts to clients.

    Woodford Equity Income

    The nature of active fund management portfolios means that there will be periods of outperformance and underperformance by all managers. There are a limited number of individuals who deliver outperformance over their peers and benchmarks over the long term, and investors who own these managers' portfolios benefit from these outcomes.

    We have followed Neil Woodford's career from 1999, when he was at Invesco Perpetual, and supported the launch of his new venture in 2014. For the first two and a half years from launch, the Woodford Equity Income fund was among the top performers in the sector, but at the end of 2016 the fund started to underperform. We had seen the fund manager display similar periods of underperformance in 1999, but then bouncing back strongly to 2003 and again underperforming in 2009, rallying strongly to 2016.

    We believed there was a reasonable expectation that the fund would do the same again. As a result, the research process concluded that the Woodford Equity Income Fund should be kept on our favourite funds list.

    As I detailed in my submission to the Treasury Select Committee, we began an active dialogue with Woodford in November 2017 over the proportion of small and unquoted assets in the Woodford Equity Income fund.

    During the course of 2018, redemptions from the fund began to increase. This meant the manager sold stocks where he had the least conviction to meet demands for investor cash. This in turn meant the unquoted portion of the portfolio was not reduced as quickly as we had desired.

    On 3 June, the authorised corporate director, Link Asset Services, decided to suspend dealing in the Woodford Equity Income Fund. We responded quickly and decisively. We immediately removed the fund from the Wealth 50, communicated the suspension to clients and dealt with all calls and emails received since in a timely and orderly manner. We waived our platform administration fee on direct holdings in this fund and we believe that Woodford Investment Management should suspend collecting its fees whilst their investors cannot access their cash. This is the right thing for them to do.

    Since these announcements, Hargreaves Lansdown's own business flows and service levels have held up well. We have actively engaged with external stakeholders, including Link, Woodford Investment Management, and the regulator as well as the financial press which followed the story closely, keeping them informed. Our priority remains to support our clients and pressing for the Woodford Equity Income Fund to reopen as soon as is practicable, whilst protecting the interests of all investors.

    I am determined that we learn from events such as these. I have apologised to all clients who have been impacted by the recent problems because we all share their disappointment and frustration. In these difficult times we recognise the financial and personal impact the gating of the fund has had on them. Philip and I, together with the unanimous support of the Board, have therefore decided that we will not take a bonus award for 2019.

    Our aim remains to provide the best possible service and choices to allow people to manage their investments simply and effectively. The shortcomings of one fund should not detract from the benefits of favourite fund lists like the Wealth 50. We are confident in the robustness of how we analyse, research and compile our favourite fund list with a focus on ensuring best value for clients. Nonetheless, we recognise that there will be learnings and improvements we can make from reviewing this event and we will ensure we apply these to benefit our clients in the future.

    The regulatory environment

    The FCA's final Investment Platforms Market Study report was published in March 2019. The FCA confirmed its view that the platform market is mainly working well. There is not excessive profitability, consumers who pay more get more and that platforms help consumers make informed investment decisions. There are no material barriers to entry in the market and whilst the cost of customer acquisition is a barrier to expansion, making transfers between platforms easier should be an appropriate solution.

    We welcome the proposed remedies which are reflective of our own core value of putting the client first. The FCA cited the need to make transfers easier and Hargreaves Lansdown is already at the forefront of this, chairing the industry's STAR working group. We anticipate that the study's focus on switching will enable a faster and more straightforward process.

    We also believe helping clients to compare and contrast platform services and fees and making it easier for them to switch between providers, will lead to healthier competition. This should promote greater engagement among clients across the entire industry. We look forward to working with the FCA on the outcomes from this study.



    Conclusion and outlook

    I am pleased with the performance and progress we have made throughout a very challenging 2019. We recognise that there are industry headwinds and that the environment continues to be difficult and we remain vigilant to these conditions. However, we are confident in the underlying strength of our business and that we are well placed to help our clients prosper whilst continuing to deliver strong and sustainable returns for shareholders.


    Chris Hill

    Chief Executive Officer

    7 August 2019


    1 Source: Platforum UK D2C Market Update (July 2019)
    2 Source: Compeer Limited XO Quarterly Benchmarking Report Quarter 1 2019

    Hargreaves Lansdown - Final Results @HLInvest https://www.voxmarkets.co.uk/rns/announcement/d7afc1a1-d5c7-4e4d-a51e-3a998ac888bb
     
    Last edited: Aug 8, 2019
  8. Groucho

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    Hargreaves Lansdown abolishes controversial exit fees for clients
    By Jonathan Jones

    STOCKBROKER Hargreaves Lansdown has removed nine investor charges, including controversial exit fees, as it seeks to repair its reputation after its involvement in the Neil Woodford debacle, The Daily Telegraph can reveal.

    In the wake of the freezing of Mr Woodford’s Equity Income fund, this newspaper called on the broker – Britain’s largest – to let affected customers switch providers free of charge.

    Hargreaves had refused to do so, but has now decided that all investors will not be charged fees normally levied ostensibly to cover the cost of administrative tasks, including selling lines of stock or funds when moving money elsewhere.

    The move will save customers about £3m a year based on the rate of switches in the past.

    Previously, Hargreaves charged a £30 account closure fee, plus £25 per fund or stock and £25 for any cash held. These fees – and a £295 plus VAT charge for closing a pension early – have now been scrapped.

    By removing these costs, investors will potentially save thousands of pounds when switching accounts. One Telegraph Money reader faced a £2,000 bill to move his £800,000 portfolio to another firm.

    Hargreaves’ Danny Cox said he hoped the rest of the industry would follow suit. Pressure now builds on the 16 major providers that still charge a fee, including The Share Centre and AJ Bell, as well as wealth managers including St James’s Place.

    Hargreaves Lansdown stopped charging customers three other fees in June: the internal stock transfer fee of £12.50, used either for transferring shares between spouses or from an Isa to a pension; a £75 fee for pensions going into “drawdown”; and a £25 cost to transfer a shareholding to a certificate.

    Two other charges were scrapped at the start of September: the 1pc fee to reinvest income in a fund; and the £1.50 per fund charged if a customer did not have sufficient cash in their account to cover management fees.

    Mr Cox said: “This makes our charging structure one of the simplest and most transparent in the market.”

    Daily Telegraph 19/09/19
     
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