AJ Bell reports revenue up 12% in 2022 year-end final results

by | Dec 1, 2022

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AJ Bell has revealed its final results for the year ended 30 September 2022. The results show profits at the platform provider have been on the up and AJ Bell has seen platform net inflows of £5.8 billion over the year.

Financial performance

Strong financial performance, with revenue up 12% to £163.8 million (FY21: £145.8 million) and profit before tax (PBT) up 6% to £58.4 million (FY21: £55.1 million)
PBT margin of 35.6% (FY21: 37.8%), reflecting the planned investment in new propositions, Dodl and Touch, and the impact of price reductions made in the year to benefit customers
Diluted earnings per share up 6% to 11.35 pence (FY21: 10.67 pence)
Final dividend of 4.59 pence per share proposed, increasing the total ordinary dividend for the year by 6% to 7.37 pence per share (FY21: 6.96 pence per share), an 18th consecutive year of ordinary dividend growth

Platform business

 
Another successful year, with customers increasing by 57,687 to 425,652 and platform net inflows of £5.8 billion (FY21: £7.0 billion)
Platform AUA closed the year at £64.1 billion, down 2% as the strong net inflows in the year were offset by adverse market movements of 11%
Customer retention rate increased to 95.5% (FY21: 95.0%)
Development of new simplified propositions to increase our footprint in the D2C and advised market segments, with Dodl launched in April 2022 and Touch to follow in 2023

AJ Bell Investments

Assets under management (“AUM”) increased by 27% in the year to close at £2.8 billion (FY21: £2.2 billion)
Underlying net inflows in the year of £1.05 billion (FY21: £922 million)
Excellent investment performance with all of AJ Bell’s multi-asset funds outperforming their Investment Association sector average over one, three and five years to 30 September 2022

Michael Summersgill, Chief Executive Officer at AJ Bell, commented:

“2022 has been another successful year for AJ Bell. Our trusted, dual-channel platform, serving both the advised and D2C markets, drove organic customer growth of 16% to over 425,000 and delivered £5.8 billion of net inflows across the platform. Our customer retention rate also remained extremely high at 95.5%, evidencing the quality of our propositions and the strong service levels we provide to our customers.

 

“Our continued growth has underpinned another excellent set of financial results in a challenging year for markets. Revenue was up 12%, profit before tax up 6% and earnings per share up 6%. Our profitable, sustainable business model and strong financial position has supported continued investment in our customer propositions and our people whilst enabling us to again increase our ordinary dividend to shareholders. The Board has proposed a final dividend of 4.59 pence per share, increasing the total ordinary dividend for the year by 6% to 7.37 pence per share.

“As we grow, the efficiency of our business model enables us to share the benefits of our scale with customers whilst still delivering strong financial returns for shareholders. Earlier this year we announced several pricing reductions across our platform which delivered total annualised savings to customers of around £5 million. We will look for further opportunities to cut costs for customers in future as we continue to grow the business.

“Our investment in new simplified customer propositions supports our long-term growth ambitions by increasing our footprint in both the advised and direct-to-consumer markets. Dodl, our new commission-free investing app complements AJ Bell, our full-service D2C proposition which has recently been renamed from AJ Bell Youinvest, enabling us to capture more retail investors earlier in their investing journey. Next year we will be launching Touch for the advised market, a simplified platform proposition that complements our full-service AJ Bell Investcentre proposition. This will broaden our offering to financial advisers, helping them serve a wider base of clients. 

 

“The success of AJ Bell would not be possible without our staff, who continue to drive the business forward, delivering award-winning propositions and great service to our customers. We continue to invest in our people and have recently enhanced our pay and benefits package for all employees. In particular I am delighted to have introduced a new annual free share award worth £2,000 per year for all employees outside of the senior management team, ensuring that everyone shares in the future success of the business. This will further strengthen the sense of ownership amongst our people which is already a hugely important part of our culture.

“This strong culture had been built over many years under the leadership of our co-founder, Andy Bell. It was a huge privilege to take over as CEO from Andy in October, having worked alongside him on the Board for 11 years. We have also implemented our succession plans for other executive roles during the year with a good blend of internal promotions and external recruits and I am confident we have the right team in place to take the business forward.

“Looking ahead, whilst market volatility is likely to persist in the short-term, our focus is very much on the long-term. The structural growth drivers for the UK investment platform market remain strong, and with around two-thirds of our estimated £3 trillion target market still held off platform, we have a significant growth opportunity ahead of us. To ensure we capitalise on this, we will be investing more in our brand to improve awareness of AJ Bell and support our long-term growth ambitions. Our diversified revenue streams and efficient operating model ensure we can continue investing in our propositions, our people and our brand whilst continuing to deliver strong financial performance, and we are well positioned heading into 2023.

 

Financial highlights

 Year ended 30 September 2022Year ended30 September 2021Change
Revenue£163.8 million£145.8 million12%
Revenue per £AUA*22.6bps22.2bps0.4bps
PBT£58.4 million£55.1 million6%
PBT margin35.6%37.8%(2.2ppts)
Diluted earnings per share11.35 pence10.67 pence6%
Total ordinary dividend per share7.37 pence6.96 pence6%
Total special dividend per sharenil5.00 pencen/a

Non-financial highlights

 Year ended30 September 2022Year ended30 September 2021Change
Number of retail customers440,589382,75415%
– Platform425,652367,96516%
– Non-platform14,93714,7891%
    
AUA*£69.2 billion£72.8 billion(5%)
– Platform£64.1 billion£65.3 billion(2%)
– Non-platform£5.1 billion£7.5 billion(32%)
    
AUM*£2.8 billion£2.2 billion27%
    
Customer retention rate95.5%95.0%0.5ppts

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