Brewin Dolphin shares plunge 5.7% after warning of market instability next year

Brewin Dolphin shares plunge 5.7% after asset manager warns of market instability next year

  • The company earned income of over £400m in the 12 months to September 30th
  • It expects volatility from weaker levels of public stimulus and consumer demand
  • “We’ve had an exceptional year,” said Robin Beer, CEO of Brewin Dolphin


Shares of Brewin Dolphin fell 5.7 percent today after it said it expects more volatile market conditions next year.

The asset manager said that after markets have rebounded strongly in the past 12 months, they will face increased volatility as public stimulus wanes and consumer spending returns to normal.

But the company believes it will perform well in the coming months, as demand for financial advice rises as a result of the pandemic and the transfer of wealth between generations.

Money: Brewin Dolphin saw revenue growth thanks to significant rise in retail client fees, rising demand for financial advisory services 1762 and

Brewin Dolphin revealed it had attracted record inflows of £4 billion in the year to 30 September, with revenues exceeding £400 million.

Income growth was driven by a significant increase in retail client fees, growing demand for financial advisory services 1762 and capital core, and the £1 billion increase in discretionary net flows.

Brewin Dolphin also noted the strong performance of its Irish division, which saw a total fund growth of £800 million and a 30 per cent increase in revenue thanks to Brexit-related transfers and a one-off business transaction in the third quarter.

The company’s CEO, Robin Beer, said: “We have had an exceptional year with record inflows of discretionary funds and we are achieving our growth ambitions.

“All of this would not have been possible without our people, who have adapted so effectively to remote working and continue to focus on putting our customers at the center of all their decision-making.

“We have remained relevant by continuing to innovate our propositions while developing our digital capabilities. We have started to increase operational efficiency through our customer management system and our new custody and settlement system is now live.”

Future: Brewin Dolphin (headquarters pictured) believes it will continue to perform well on growing demand for financial advice and the transfer of wealth between generations

Future: Brewin Dolphin (headquarters pictured) believes it will continue to perform well on growing demand for financial advice and the transfer of wealth between generations

Due in part to the use of two parallel customer management systems, the group predicts that operating expenses will grow at a mid-to-high single digit rate this fiscal year, with wage inflation and other investments also contributing.

UK investment firms have benefited heavily from attracting hundreds of thousands of new clients during the pandemic, many of whom were young and first trying to invest.

AJ Bell’s results for fiscal year 2021 showed it attracted 87,000 additional customers to its platform, while Hargreaves Lansdown added an additional 233,000 customers.

Both firms noted that trading activity has slowed as restrictions eased, but are confident they will continue to do well despite the long-term changes affecting the investment sector.

Commenting on Brewin Dolphin’s trading update today, Rob Murphy, the general manager of finance at Edison Group, said: “After a great year helped by booster vaccinations that lifted investor sentiment, market volatility could increase as Covid-19 relief measures wane and the consumer demand falls back to normal levels.

“Given the near-term cost pressures, investors will be watching closely to see if it remains on track to deliver on its vision of achieving double-digit earnings per share growth by 2025.”

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