Hargreaves Lansdown registers 13% Y/Y growth in revenue in Q1 FY24
Hargreaves Lansdown plc (LON:HL) today issued a trading update in respect of its first quarter ended 30 September 2023.
Net new business of £0.6 billion in the quarter (Q1 2023: £0.7bn), reflects moderated flows being seen across the market. Active Savings continues to perform well and has been the key driver of net flows as clients favour cash savings over risk based investments.
The company reported net client growth of 8,000 in the quarter (Q1 2023: 17,000) primarily driven by net new clients in the SIPP and Active Savings accounts. Client retention was at 91.7% (FY2023: 92.2%) and asset retention was at 89.0% (FY2023: 90.4%) reflecting the muted macroeconomic backdrop and the need for various cohorts of clients to make cash withdrawals.
Share dealing volumes averaged 634,000 per month in the quarter (Q1 2023: 700,000) reflecting wider market trends.
Client cash balances were £12.4 billion at the end of the quarter, 9.2% of total AUA, with heightened levels of cash withdrawals and an increase in movement of cash into Active Savings in July and August before stabilising in September.
Total revenue in the quarter of £183.8 million (Q1 2023: £162.9m) with net interest margin growth more than offsetting the revenue impact of the reduction in share dealing volumes.
Dan Olley, Chief Executive Officer, commented:
“We continue to see net client growth and positive net new business despite the macroeconomic backdrop and its on-going impact on investor confidence and client behaviour.
Clients are looking to invest more in cash than risk-based investments, from our Active Savings offer, giving easy access to a range of banking partners, to Money Market Funds and short-dated bonds. Combining this with informative and relevant content provides our clients with a wide range of solutions to meet their saving and investment needs.”