1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.
  2. Dear Guest, we realise advertising is annoying, it is however necessary to help us be a sustainable resource for all, if you want to go advert free then please use the following link to subscribe for £5 a month: Click here
    Dismiss Notice

(HL) Hargreaves Lansdown General Share Chat

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

  1. Microem1

    Microem1 Administrator

    (HL) Hargreaves Lansdown General Share Chat
  2. Groucho

    Groucho Member

  3. Groucho

    Groucho Member

    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').


    · 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

    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.

  4. Groucho

    Groucho Member

    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.


    · 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."


    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.


    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

    Last edited: Jan 29, 2019

Share This Page