Hargreaves Lansdown plc (LON:HL) today issued a trading update in respect of the three months ended 31 March 2024 (Q3 FY24).
Total revenue in the quarter of £199.7 million (Q3 2023: £188.1m) benefited from increased dealing volumes and higher platform revenue from higher AUA levels, more than offsetting the year on year reduction in revenue on cash from lower NIM and cash balances.
Net new business of £1.6 billion in the quarter (Q3 2023: £1.6bn) was driven by net flows on to the Platform as clients focused more on utilising their ISA and SIPP allowances. Active Savings continued to perform well and benefited from the launch of the first of its kind multi-bank cash ISA which provides clients with the full suite of Cash ISA products (fixed-term, easy access and limited access) from multiple banks.
Net client growth of 34,000 in the quarter (Q3 2023: 23,000) was supported by net new clients in the SIPP, ISA and Active Savings accounts. Client retention at 91.4% (Q3 2023: 92.0%) and asset retention at 88.0% (Q3 2023: 89.1%) continued to reflect the macroeconomic backdrop for those of our clients who need to make cash withdrawals.
Share dealing volumes averaged 794,000 per month in the quarter (Q3 2023: 770,000) and an increase in volumes seen since the first half of the financial year, with overseas deal volumes representing 23.6% of total deals in the quarter (Q3 2023: 16.8%).
As expected, client cash balances increased during the quarter as clients contributed to their tax wrapped accounts ahead of the tax year-end deadline to £12.4 billion (Q3 2023: £13.5bn)
Looking ahead to the remainder of the financial year, the company noted that it sees momentum continue into April as clients take advantage of the benefits of investing at the start of the tax year.
Dan Olley, Chief Executive Officer, commented:
“We welcomed 34,000 net new clients in the quarter, reflecting the increasing popularity of our newer products such as ready-made pensions, our cash ISA offerings and Active Savings. A record number of clients contributed to their pensions in the tax year, with the average amount subscribed up by c22% and 270,000 of our clients now have an Active Savings account, resulting in Active Savings reaching the significant milestone of £10 billion in AUA since the end of the quarter.”
