Hargreaves Lansdown continued to attract new business in its latest half year, recruiting 25,000 new clients and boosting assets under administration from £9.9bn a year earlier to £15.6bn.
A bulk of group revenue came through the investment manager's Vantage platform, which allows investors to hold investments in a variety of tax-efficient schemes and from which Hargreaves Lansdown earns a commission as a distributor and administrator. Assets here rose from £10.9bn to £14.4bn, of which £2.2bn of the increase reflected an improvement in equity values and the balance of £1.3bn came from net new business inflows. Vantage revenue rose 22 per cent to £51.3m.
However, investment income from cash holdings fell from £1.55m to £0.46m as a result of falling interest rates, and the full effect will be felt in the second half of the year when more fixed interest income arrangements expire.
An increase in allowances for saving in Isas and the fear of higher taxation are expected to boost investor interest in the second half, although uncertainty over the outcome of the election could have a detrimental effect on equity values near-term and could lead to a certain amount of client paralysis.
Numis Securities is forecasting full-year pre-tax profits of £87.6m and EPS of 13.5p (£72.3m and 10.9p in 2009).
More analysis of company results
| HARGREAVES LANSDOWN (HL.) | ||||
|---|---|---|---|---|
| ORD PRICE: | 293p | MARKET VALUE: | £1.4bn | |
| TOUCH: | 292-294p | 12-MONTH HIGH: | 315p | LOW: 165p |
| DIVIDEND YIELD: | 4.2% | PE RATIO: | 25 | |
| NET ASSET VALUE: | 17p | NET CASH: | £63m** | |
| Half-year to 31 Dec | Pretax profit (£m) | Earnings per share (p) | Net div per share (p) |
|---|---|---|---|
| 2008 | 36.5 | 5.50 | 3.07 |
| 2009 | 39.8 | 6.00 | 8.00* |
| % change | +9 | +9 | +161 |
Ex-div:10 Mar Payment:26 Mar *Excludes special dividend of 1.6p, payable on 26 Mar. **Excludes £15m of restricted cash | |||
