(Alliance News) - Wealth management platform Hargreaves Lansdown on Friday reported a slight dip in revenue as it said the "normalisation" of retail investment activity post-pandemic has been in line with its expectations.
Assets under administration stood at GBP138.0 billion at the end of September, up 2% since June 30. It reported net new business of GBP1.3 billion in the quarter and net new clients at 23,000, slowing from the year ago's addition of 31,000, to take active client numbers to 1.7 million.
Revenue slipped to GBP142.2 million from GBP143.7 million a year ago. Asset-based revenue was higher, but this was more than offset by a drop in interest on client money and a reduction in share-dealing revenue.
"As anticipated share-dealing volumes have declined post Covid lockdowns and across the quarter averaged 861,000 deals per month versus 980,000 in the quarter last year and 479,000 the year before," the Bristol-based company said.
Nonetheless, Chief Executive Chris Hill remained confident in HL's prospects.
"Today we report a good start to our financial year, with continued growth in clients and assets in what is typically our quietest quarter...These results are against the backdrop of an easing out of lockdown and ongoing market uncertainty and highlight the importance of a resilient business and the strength of our proposition," said Hill.
HL said it will host a capital markets event in the first quarter of 2022 to set out its growth plans to "deliver beyond this period of post pandemic 'normalisation'."
Hargreaves Lansdown shares were down 0.8% early Friday.
Here is what you need to know at the London market open:
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MARKETS
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FTSE 100: up 0.5% at 7,241.12
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Hang Seng: up 1.2% at 25,262.87
Nikkei 225: closed up 1.8% at 29,068.63
DJIA: closed up 534.75 points, or 1.6%, at 34,912.56
S&P 500: closed up 74.46 points, or 1.7%, at 4,438.26
Nasdaq Composite: closed up 251.80 points, or 1.7%, at 14,823.43
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EUR: up at USD1.1614 (USD1.1587)
GBP: firm at USD1.3688 (USD1.3680)
USD: up at JPY114.01 (JPY113.63)
Gold: down at USD1,791.39 per ounce (USD1,797.11)
Oil (Brent): up at USD84.82 a barrel (USD83.75)
(changes since previous London equities close)
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ECONOMICS AND GENERAL
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Friday's Key Economic Events still to come
1100 CEST EU foreign trade
1100 BST Ireland goods exports and imports
0830 EDT US import & export price indexes
0830 EDT US retail sales
1000 EDT US University of Michigan consumer confidence survey
1000 EDT US manufacturing & trade
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Sydney will scrap all quarantine requirements for travellers from next month, officials said, an abrupt step toward reopening Australia's long-shuttered borders. In a surprise announcement, Premier Dominic Perrottet of New South Wales said that from November 1 vaccinated travellers would be allowed to enter the state without quarantine of any kind. "For double vaccinated people around the world, Sydney, New South Wales, is open for business," Perrottet said. But Perrottet's suggestion that tourists and students could be weeks away from returning to Australia was promptly slapped down by the country's Prime Minister Scott Morrison – whose government controls borders, while quarantine rules are a state issue. "All we are talking about now is Australian citizens, residents and their immediate families," Morrison said, insisting he would not open the borders to visitors just yet.
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China's economic growth is expected to have slowed further in the third quarter, according to an AFP poll of analysts, with a mounting energy crisis and property market tremors casting a pall as the country's post-Covid recovery lost steam. While the world's number-two economy bounced back quickly from the coronavirus outbreak last year, with gross domestic product growth returning to pre-pandemic levels, economists say further slowdown is "inevitable". Growth is forecast to come in at 5.0% on-year for July-September by the 12 analysts polled by AFP, representing a sharp slowdown from the 7.9% clocked in the previous three months. They also downgraded their full-year growth expectations to 8.1%, from the 8.5% predicted in a July poll. Official figures will be released on Monday.
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BROKER RATING CHANGES
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BERENBERG RAISES BP TO 'BUY' (HOLD) - PRICE TARGET 425 (310) PENCE
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RBC RAISES ANTOFAGASTA TO 'SECTOR PERFORM' (UNDERPERFORM) - PRICE TARGET 1,350 (1,150) PENCE
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BERENBERG RAISES HARBOUR ENERGY TO 'BUY' (HOLD) - PRICE TARGET 425 (380) PENCE
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COMPANIES - FTSE 100
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Educational publisher Pearson backed full-year forecasts as it continues to bolster its digital offering. For the nine months to the end of September, total sales were up 10% on an underlying basis. All segments saw growth except for Higher Education, where sales fell 7% as growth in international courseware, including Canada and the UK, was more than offset by a 9% decline in US Higher Education Courseware. Pearson pointed to a decline in US enrolments, particularly in community colleges. More positively, its new US learning app, Pearson+, launched in late July and is "progressing well" with over two million users. Pearson said it remains on track to deliver full-year adjusted operating profit in line with market expectations, which it placed at GBP377 million. This would be up from GBP313 million in 2020, but still far lower than the GBP581 million achieved in 2019.
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COMPANIES - FTSE 250
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Polymer maker Victrex said Chief Financial Officer Richard Armitage is leaving to become CFO of Morgan Advanced Materials. Armitage will leave Victrex after three and a half years on May 27 of next year, and a search for a replacement will begin soon. It added that trading in its financial year that ended on September 30 was in line with expectations. Morgan Advanced said Armitage will take up the CFO post at the Windsor-based industrial products manufacturer on May 30, 2022, succeeding Peter Turner.
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COMPANIES - MAIN MARKET AND AIM
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Electra Private Equity provided more detail on its plan to demerge Fridays restaurant chain operator Hostmore, with trading in London set to start early next month. Fridays, previously branded as TGI Fridays, is an American-themed casual dining brand. "While Fridays has been trading for over three decades in the UK, Hostmore was established in 2021 to provide a platform for the development of hospitality brands under the leadership of an experienced management team that has a track record of building businesses in the hospitality and leisure sectors," Electra said. Over the 20 weeks since indoor dining resumed in the UK, Hostmore reported like-for-like growth of 11% versus 2019. In the 11 weeks since the further relaxation of Covid-19 restrictions in July, like-for-like growth averaged 12%.
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COMPANIES - GLOBAL
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Johnson & Johnson turned to a bankruptcy court on Thursday in an attempt to resolve ongoing litigation tied to selling baby powder containing cancer-causing asbestos. The New Jersey-based pharmaceutical firm said its newly created subsidiary LTL Management, formed specifically to manage claims in the cosmetic talc litigation, had filed for voluntary bankruptcy protection. The filing is intended to resolve all claims in a "manner that is equitable to all parties", including any current and future claimants, Johnson & Johnson stated, adding it will provide funding to LTL for the payment of any debts the bankruptcy court determines are owed and will also establish a USD2 billion trust for the same purpose.
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Friday's Shareholder Meetings
Ashmore Group PLC - AGM
Hargreaves Lansdown PLC - AGM
Kropz PLC - GM re director authority to allot shares
Loungers PLC - AGM
Sherborne Investors (Guernsey) B Ltd - EGM re delisting and liquidation
Tungsten Corp PLC - AGM
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By Tom Waite; thomaslwaite@alliancenews.com
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