Home Money AJ Bell shares rise 10% as investment platform raises dividends and profits rise

AJ Bell shares rise 10% as investment platform raises dividends and profits rise

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Rapid rise: AJ Bell shares rose more than 10% on Thursday
  • AJ Bell seeks long-term cash savings to grow customer base

AJ Bell stock rose more than 10 percent on Thursday after the investment platform increased its dividend amid higher half-year profits and revenue.

To give AJ Bell shareholders a boost, the group announced an interim dividend of 4.25 pence per share, up 21 per cent on the same period last year.

AJ Bell’s pre-tax profit rose 47 per cent to £64.1m in the six months to the end of March, while revenue rose 27 per cent to £131.3m.

The group focuses on people with long-term cash savings who are looking for an alternative location for their money.

Rapid rise: AJ Bell shares rose more than 10% on Thursday

Chief executive Michael Summersgill said: “Long-term cash savings represent an important part of the market addressed by platforms like ours.”

“There are millions of people in the UK who hold cash savings for long periods of time, missing out on the superior returns that risk-based assets offer.”

Across AJ Bell’s platforms business, which operates things like Sipps, a stocks and shares Isa company and Lifetime Isa, net inflows hit £2.9bn, up 45 per cent on the same point a year ago. anus. Assets under management grew to a record £80.3 billion.

AJ Bell shares rose 11.59 per cent or 42.00 pence to 404.50 pence on Thursday, having risen more than 27 per cent in the last year.

Summersgill said: ‘I am pleased to announce an excellent set of results in the first half.

“Our dual-channel platform continued to generate strong organic growth with 27,000 customers added in the period and total platform customers exceeding half a million, a significant milestone for the business.”

He added: “This customer and AUA growth drove very strong financial performance, with both revenue and pre-tax profit increasing significantly.”

The group’s customer retention rate fell to 94.5 percent in the period, down from 95.5 percent a year ago.

On 1 April, AJ Bell reduced its custodial fees for advised clients and halved its core trading fee for direct-to-consumer clients to £5.

He added: “For our D2C customers, we have halved trading charges for shares, ETFs, investment trusts and bonds from £9.95 to £5.00 per trade, while charges for frequent traders have been reduced. have been reduced from £4.95 to £3.50”.

Investment platforms are locked in a battle to attract more clients and keep their rates and charges competitive.

Britain’s biggest investment platform, Hargreaves Lansdown, has become the latest London-listed company to be targeted by foreign bidders.

After the market closed on Wednesday, Hargreaves Lansdown said it had received two proposals from a consortium of buyers regarding a possible acquisition.

The latest offer, valued at 985 pence per share or £4.67bn, was unanimously rejected by the board “on the basis that it substantially undervalues ​​Hargreaves Lansdown and its future prospects”.

But the suitors – private equity firm CVC, Nordic Capital and Abu Dhabi Investment Authority-owned Platinum Ivy – are understood to be considering a new bid.

Hargreaves Lansdown Shares They rose 7.71 per cent or 75.50 pence to 1,054.50 pence on Thursday, having risen 27 per cent in the last year.

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