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Hargreaves Lansdown PLC on Thursday reported a weaker performance for its financial year to date, with revenue and assets under administration experiencing a fall due to adverse market movements.
Shares in the Bristol-based fund retail investment platform were 7.2% lower at 831.60 pence on Thursday in London, the worst performer in the FTSE 100 index.
For the four months ended April 30, the group's revenue was in line with company expectations, down 16% to £196.5 million from £233.3 million a year before, as a net interest margin increase was more than offset by the drop in assets.
For Hargreaves Lansdown's financial year to date, covering the 10 months to April 30, revenue was down 8.4% to £487.6 million from £532.7 million a year prior.
Net new business for the four-month period was £2.5 billion, and was £4.8 billion for the ten-month period. Net new clients for the four months plunged 67% year-on-year to 42,000 from 126,000, taking total active clients to 1.73 million.
Assets under administration as at April 30 was £132.3 billion, a slight drop from £132.9 billion the same date a year before, which Hargreaves attributed to adverse market movements through exposure to global equity markets, particularly US technology stocks.
Looking ahead, Hargreaves Lansdown reiterated its annual guidance, but has raised its expected revenue margin on cash to 30 to 35 basis points for the year.
‘We are off to an encouraging start on the strategic initiatives we set out at our Capital Markets Day, which will build our capability to innovate and scale and enable us to take advantage of the growth in the wealth management sector,’ said Chief Executive Officer Chris Hill.
‘The challenging backdrop driven by unprecedented macro-economic and geo-political events has impacted markets and investor confidence, in turn leading to moderated flows and asset levels with net new business of £2.5 billion in this period,’ Hill added.
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