REG - Hargreaves Lansdown - Half-year Report
22/02/2024 07:00
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RNS Number : 0098E Hargreaves Lansdown PLC 22 February 2024
Hargreaves Lansdown plc
Interim results for the six months ended 31 December 2023
Clear strategic ambition and early delivery provides strong potential for
future growth
Highlights
· AUA up 6% since 30 June 2023 to a record £142.2 billion (H1 2023:
£127.1bn)
· Net New Business of £1.0 billion (H1 2023: £1.6bn)
· Revenue up 5% to £368.2 million (H1 2023: £350.0m)
· Underlying Diluted Earnings per Share 34.6p (H1 2023: 35.5p); Interim
Dividend increased 4% to 13.2p (H1 2023 12.7p)
· Business-wide review largely complete; tangible progress against
initial priorities and clear plan moving forward
Financial highlights 6 months ended 31 December 2023 6 months ended 31 December 2022 Change % Year ended
30 June
2023
(H1 2024) (H1 2023) (FY 2023)
Net new business (NNB) £1.0bn £1.6bn -38% £4.8bn
Total assets under administration (AUA) £142.2bn £127.1bn +12% £134.0bn
Revenue £368.2m £350.0m +5% £735.1m
Profit before tax £182.5m £197.6m -8% £402.7m
Underlying profit before tax* £221.5m £211.9m +5% £438.8m
Diluted earnings per share 28.5p 33.1p -14% 68.2p
Underlying diluted earnings per share* 34.6p 35.5p -3% 74.3p
Interim dividend per share* 13.2p 12.7p +4% 41.5p
*Underlying profit before tax and underlying diluted earnings per share are
Alternative Performance Measures which exclude the impact of strategic
investment costs, intangible impairment and restructuring costs. See the
Glossary of Alternative Performance Measures on page 29 for the full
definitions and page 30 where reconciliation to the relevant statutory measure
is provided.
Dan Olley, Chief Executive Officer, commented:
"Our first half results are a reflection of the fundamentals of our business;
AUA has increased to a record £142.2bn, revenue has increased 5% to £368.2m
and our underlying profit before tax at £221.5m is also up 5%.
It is now six months since I took over as CEO and it is clear that the
business is built on strong foundations; a proud heritage, with a trusted
brand and knowledgeable, client-focused colleagues.
What is also clear is the work to be done to capitalise on those foundations
to reposition HL to take advantage of the structural growth opportunities
ahead. The detailed and data-led approach we are taking is giving clear
insight into client needs which, together with our focus on execution, the
strengthened leadership team and improvements in our technology capability,
means we are off to a great start.
The four priorities I set out in September are the right ones to drive the
business forward and I am pleased with the tangible progress we have made in
the first half.
As the largest wealth platform in the UK, looking ahead, ours is a large and
growing market with clear client needs. We have the scale needed to succeed
and we have the right strategy and ambition to accelerate our growth."
Contacts:
Hargreaves Lansdown
For media enquiries: For analyst enquiries:
Danny Cox, Head of Communications James Found, Head of Investor Relations
+44(0)7989 672071 +44(0)7970 066634
Nick Cosgrove Amy Stirling, Chief Financial Officer
Brunswick Group +44(0)207 404 5959
Analysts' presentation
Hargreaves Lansdown will be hosting an analyst presentation at 9.00am on 22
February 2024 following the release of the results for the half year ended 31
December 2023. The meeting can only be accessed remotely via a live dial-in
facility. To register as a participant please use the following link:
https://www.netroadshow.com/events/login?show=d75b5596&confId=60707
(https://gbr01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.netroadshow.com%2Fevents%2Flogin%3Fshow%3Dd75b5596%26confId%3D60707&data=05%7C02%7Cjames.found%40hl.co.uk%7Cd570cd17b95c48c1f22f08dc287be3fb%7C90578e2dfce84c57a1a62b4909a9dc4d%7C0%7C0%7C638429759782284708%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C0%7C%7C%7C&sdata=ot9L9%2B0kbpkHDUoVdGnrHHNWcB4UgabHf%2BOSR0w1tic%3D&reserved=0)
Slides accompanying the analyst presentation will be available this morning at
www.hl.co.uk/investor-relations (http://www.hl.co.uk/investor-relations) and
an audio recording of the analyst presentation will be available by close of
business on the day.
Alternative performance measures
Included in this announcement are various alternative performance measures
used by the Company in the course of explaining the results for the six months
ended 31 December 2023. These measures are listed along with the calculations
to derive them and an explanation of why we use them on page 29 in the
Glossary of Alternative Performance Measures. A reconciliation to profit
before tax is given in the Operating and Financial Review section.
Forward-looking statements
The Interim Results contain forward-looking statements which have been made in
good faith based on the information available to us at the time of the
approval of this report and should be treated with caution due to the inherent
risks and uncertainties, including both economic and business risk factors
some of which were set out in the 2023 Annual Report, underlying such
forward-looking information.
Unless otherwise stated, all figures below refer to the six months ended 31
December 2023 ("H1 2024"). Comparative figures are for the six months ended
31 December 2022 ("H1 2023"). Certain figures contained in this document,
including financial information, have been subject to rounding adjustments.
Accordingly, in certain instances the sum of the numbers in a column or a row
in tables contained in this document may not conform exactly to the total
figure given for that column or row.
Chief Executive's Statement
Overview
It is now six months since I took over as CEO. As I said at my first set of
results a few weeks in, HL is a great business, built on a proud heritage,
with a trusted brand and great people. We have a large, growing and loyal
client base and, with more than 14,000 investment options, we offer our
clients a broad choice of investment and savings solutions.
The last six months have been anything but smooth from a global or a UK
perspective, with ongoing geo-political volatility, the cost-of-living squeeze
in the UK and UK equity markets remaining challenged. Despite this backdrop,
we saw growth in the platform, with an additional £1 billion in net new
business and we welcomed an additional 20,000 new clients, taking our total
client base to 1.82 million.
While the continued growth underlines the fundamental strength of the
business, we need to do more to improve our flow performance. Our inflows
continue to be strong, but our outflows have increased reflecting both the
market backdrop and our product mix. We know that our clients have been
impacted by the cost-of-living squeeze, however, we also know we have more to
do to improve our service levels to meet our own high expectations and to
evolve our digital journeys.
Having undertaken a thorough review of the business, which is largely
complete, it is clear that there are areas where we can and must execute
better to provide even more value to our clients to help them achieve even
better outcomes, in turn, driving stronger client and asset growth.
We are building on strong fundamentals, I am excited by the leadership
capability we have put in place and confident we have the strategy and
ambition to accelerate our growth. The initial priorities I set out in
September last year remain the right ones, and I will outline our progress
against them below as well as our granular approach to delivery.
H1 2024 Business performance
Our gross inflows to the platform were up year on year, however, our outflows
were up too, meaning that overall, our net new business came in at £1.0
billion compared to £1.6 billion last year. Outflows were highest in the
products that our clients use for more transient saving and investing, such as
our Fund and Share Account, driven by cash withdrawals to deal with
cost-of-living issues and/or to pay down debts. The period also saw an
increase in transfers to banks and building societies to take advantage of
Cash ISA products. We responded to this by launching a Cash ISA last year and
the first Multi-Bank Cash ISA in January 2024, helping clients spread their
allowance across multiple banks, and across easy access, limited access and
fixed-term Cash ISA products.
Our pension products continued to see the lowest level of outflows, with
inflows ahead of last year.
The rally in markets, particularly towards the end of the period delivered a
positive market movement of £7.2 billion which, combined with the net new
business of £1.0 billion meant our AUA reached a record of £142.2 billion
(June 2023: £134.0bn).
The higher AUA, combined with the impact of higher net interest margin this
year, delivered a resilient financial performance with revenue up 5% to
£368.2 million (H1 2023: £350.0m) and underlying profit before tax also up
5%.
Along with other platforms, we received and responded to the Dear CEO letters
regarding platform cash during the period. We consider cash to be an integral
part of the way clients use their investment accounts, either holding cash as
part of a portfolio or as part of the running of a product, for example,
making payments or receiving dividends. We retained 41% of interest during the
period and expect this to be c.36% in Q3 FY24 and we do not charge platform
fees on cash, the practice known as "double-dipping" and our approach is set
out in more detail in the Financial Review on page 8.
Underlying costs were in line with our guidance coming in at £161.0 million
(H1 2023: £146.1m) and underlying profit before tax increased 5% to £221.5
million (H1 2023: £211.9m).
Total strategic spend in the period increased to £24.7 million (H1 2023:
£23.4m) as we increased the pace of our delivery. As part of my review, we
have simplified our technology roadmap by adopting a more modular approach to
delivery and rationalised our technology vendors. As a result, we have
recognised an impairment charge of £14.4 million against two specific assets
previously capitalised. We have also incurred £2.9 million restructuring
costs in relation to the reset of the Executive and Digital Leadership teams.
As a result, statutory profit before tax decreased by 8% to £182.5 million
(H1 2023: £197.6m).
Our purpose is more relevant than ever
At HL, our purpose - making it easy to save and invest for a better future -
is more relevant than ever. Our research shows that currently only 13% of UK
households are on track for a comfortable retirement 1 (#_ftn1) and one third
of people (34%) have less than £1,000 in savings. We believe that everyone
should be encouraged to build a financially secure future, and even putting a
little aside regularly can leverage the power of compounding to make a big
difference in the years to come.
From launching a new lifestyling arrangement for our SIPP clients (the
Ready-Made Pension Plan) to piloting digital investment masterclasses, we are
committed to playing our part in getting people investing for their and their
family's future.
We are operating in a large and growing market, estimated to be c. £3.7
trillion by 2026. As we expand our range of products, we open up this market,
with HL able to provide one single platform for our clients to save and invest
for their future.
Our Strategy - what we are setting out to do
Our strategy is to:
1. Transform the investing experience;
2. Leverage our scale to continuously deliver value;
and
3. Combine the best of colleague and digital
capability.
Transforming the investing experience - Our research shows that investing can
be daunting and difficult for retail investors.
Our first strategic goal is to transform the investing experience, helping
people engage with their financial security by making investing
understandable, simple and accessible for all. This is nothing new for HL; it
is the foundation on which Peter Hargreaves and Stephen Lansdown started the
company over 40 years ago. We have proven that giving people confidence by
providing relevant, timely and digestible investment information and then
making it easy to act helps our clients invest and get positive outcomes.
Leveraging our scale to drive client value - Leveraging our scale is the
renewed focus of our strategy; and enables us to continuously improve our
client value proposition.
We are driving efficiencies in everything we do, in our operations through
process improvement, simplification, automation and standardisation, and
across all areas of our spend to return those benefits back to clients by
reinvesting in the platform and to shareholders through stronger returns. This
is the fundamental flywheel of our company and a discipline we must embrace.
Combining the best of colleague and digital capability - This means offering a
great digital experience and having knowledgeable colleagues available
whenever clients want to talk to us.
There is much more we will do to improve our digital journeys, and much more
we are automating to drive greater efficiency, but our core value proposition
will always provide our clients the option to interact with us in their
preferred channel - web, app, via our expert Helpdesk or through our financial
advisers.
Combining the best of our colleague and digital capability by empowering
colleagues with the right tools will allow HL to scale efficiently while
giving our clients the support and experience they want and deserve.
Progress against our priorities
The initial priorities I laid out in September are still the right ones to
drive the business forward:
· Delight clients, drive growth - continue to evolve our value
proposition to delight our clients and through that, drive our growth;
· Save to invest - always strive to be a fitter and leaner business;
· Increase execution pace - deliver for our clients everyday,
improving our proposition on an ongoing basis;
· Right people, right roles - make HL great for colleagues; the right
culture, with the right people in the right roles, focused on the right
priorities to deliver the strategy.
We have made tangible progress against all four areas, and while there is much
more to do, we are confident in our ability to execute against these
priorities.
Delight clients, drive growth
We know our clients are daunted by saving and investing, the terminology can
be confusing and execution difficult and once they start, they want everything
in one place. This is why helping our clients build their confidence, making
it easy and providing a broad choice is at the heart of our value proposition.
To start with we are focussing on three areas:
1. Continue to deliver strong inflows, by building investing
confidence through targeted content and making it easy through frictionless
flows, to drive new client acquisition and AUA growth.
HL's research and insights are often what bring clients to
HL in the first place. We are focused on improving content driven inflows,
providing clients with relevant investment ideas, in the right way, at the
right time.
Last September we outlined how we are building people's confidence in
investing in the UK gilt market. Our efforts to make gilts easy to understand
and invest in for the right audience resulted in £1.8 billion of inflows over
the period. HL's research team's annual "5 to watch campaign", has driven over
£100m of flows in its first month.
Making it easy for clients to add money to the platform is
crucial. Last year we launched Easy Bank Transfer and it recently reached an
important milestone with over £1 billion payments now made this way.
2. Enhancing the client experience, by resetting our Client
Service levels and enhancing the digital experience to "make it easy" to
execute with HL, driving client retention.
We are resetting and transforming our client service for
those clients who want to speak to us directly, and enhancing and extending
our digital experience. We've invested in our Helpdesks, resulting in an 11pp
increase in the number of calls answered within 20 seconds.
In terms of the digital experience, we are embedding analytics to improve
client journeys. Our refreshed web navigation has delivered a 20% higher
conversion of "transfers in" journeys. And simply making our "ready-made
investments" more visible in the app has increased purchases by 51%.
3. Evolving our product mix, by expanding our proposition and digital
features to drive client retention and acquisition and ultimately AUA growth,
especially in Active Savings and Pensions.
Our product mix needs to evolve. We have grown our SIPP AUA
more slowly as a proportion of total AUA than some of our competitors and that
is naturally resulting in higher client and asset churn. Greater focus is
being given to extending our proposition across all our product lines.
Analysis showed our ISA outflows were being driven by clients moving to Cash
ISAs. We have recently extended Active Savings to add a first-of-its-kind
Multi-Bank Cash ISA, providing clients with the full suite of Cash ISA
products (fixed-term, easy access and limited access) from multiple banks.
Save to invest
During the first half of the year, we have introduced more disciplined
management of third party spend across all areas of the business, such as IT
licences, recruitment agencies and contractor spend.
To drive process improvements across our operations, we have established
internal process automation teams with an initial focus on six processes that
currently require a significant amount of manual work. Our first automated
process is now launched and the other five are on track to be automated by the
end of April.
Additionally, we are rationalising the operating model and optimising our
organisational structure to sharpen accountabilities.
Taken together, these actions start to create capacity for us to invest in our
clients through our proposition and platform, and in turn generate stronger
returns for shareholders, as we make further progress with the execution of
our strategy.
Increase execution pace
Over the last six months, we have successfully piloted new ways of working
with the aim of increasing the pace of delivery of both small incremental
change within our day-to-day activities and the larger innovation and change
being delivered as part of our strategic projects. We have created efficient
cross-functional teams aligned with each product line and building the
organisational muscle to rapidly create ring-fenced project teams to deliver
the overall strategic investment programme.
While still only a few months in, we are already seeing an increased pace of
execution and tangible benefits being delivered. For example, our rollout of
Amazon Connect was accelerated and delivered in half the time originally
estimated. This allowed us to decommission the legacy telephony system ahead
of plan and save on dual running costs. Our initial implementation of
Salesforce within our Complaints and Client Service team will be achieved in
four months, meaning these tools will now be in place for colleagues over tax
year end.
We also continue to progress our investment in the evolution and modernisation
of our technology estate which aims to:
1. Deliver a state-of-the-art digital client experience
2. Decouple our cost to serve and client growth through automation
3. Deliver a highly resilient and linearly scalable platform
We have been able to simplify the technology roadmap by adopting a more
modular approach, leveraging standards or through the rationalisation of
vendors. This does not impact our ability to achieve what we have set out to
do and builds our confidence in our ability to deliver within the financial
parameters set out.
In terms of data and relevancy, our focus has been on setting the right
foundations, implementing our AI Workbench tooling and Machine Learning
Operations pipeline and we are progressing our new BI platform based on
Snowflake which will be launched over the coming months.
We now have in place the foundations on which to build and increasingly
automate our business processes whilst giving our colleagues the tools they
need to provide great client service efficiently. This is how we will decouple
people and cost growth from our client growth.
Leveraging Cloud infrastructure creates a highly resilient and linearly
scalable platform and we have made progress in this area.
Right people, right roles
I have prioritised building my executive leadership team and I am pleased to
have appointed:
· Richard Hebdon as Chief Digital and Technology Officer - Richard
has joined HL from RELX, the global information services provider, where he
was Chief Technology Officer for a division of LexisNexis.
· Afonso Nascimento as Chief Strategy Officer - Afonso has been
with us as interim CSO for the last three months driving our strategic agenda
and digital transformation initiatives forward. Afonso brings extensive
strategy and financial services experience from Boston Consulting Group.
· Lucy Thomas as Corporate Affairs Director - Lucy is currently
Director of Corporate and Regulatory Affairs at TalkTalk, and prior to this
she held senior roles at Edelman and at the BBC where she was a producer on
programmes such as Newsnight and the World at One. She will join HL in March.
We have also significantly strengthened the technology leadership team with
the addition of new talent leading our client-facing solution development
teams and our digital automation and transformation teams.
Board changes
I am delighted that Alison Platt joined us as Chair of the Board and
Non-Executive Director on 6 February 2024. Alison brings a wealth of relevant
experience. She was, until recently, Chair of Dechra Pharmaceuticals plc. She
is also a Non-Executive Director of Tesco plc and Chair of general insurer
Ageas UK. I very much look forward to working with her.
I would like to thank Penny James for acting as Interim Chair since 8 December
2023. She has now reverted to her previous Board position as Senior
Independent Director. The Board benefits greatly from her insight and
expertise.
Dividend and Capital Management Framework
The Board has declared an interim dividend of 13.2 pence per share in line
with our guidance of a 4% increase on H1 2023.
As stated last September, the Board has now set out our capital management
framework and more detail on this can be found in the financial review on page
11.
FY24 Guidance and medium term outlook
As we begin the second half of the year, we have the all-important tax year
end season ahead and whilst the current uncertain economic environment is
likely to remain and weigh on investor confidence, we will do all that we can
to support our clients to make the most of their tax allowances, improve their
financial resilience and achieve their financial goals.
In terms of revenue margin, given our H1 performance we now expect to be at
the top end of guidance on NIM and Active Savings margin, and at the lower end
of the range on Shares given continued muted dealing volumes. Funds margin
guidance is unchanged.
With regard to asset mix, we closed the period with cash at 8.5% of AUA, as
clients continue to make active decisions to invest, put their cash to work as
savings or withdraw from the platform. We expect to see this trend continue in
the second half and see platform cash on a glide path to c.£11.5 billion with
different profiles in Q3 and Q4 given the expected step up over tax year end
driven by inflows.
We are now expecting underlying cost growth at the lower end of our 9-11%
guidance range driven by our latest view on the FSCS levy which indicates that
we will not see the uplift we had anticipated this year.
Given our increased momentum, full year Strategic Opex spend is now expected
to be at the top end of our guidance for the year at c.£45m.
We are re-iterating our guidance of 4% growth in our ordinary dividend for the
full year.
Looking further forward, we will measure our success in the delivery of our
strategy through seeing a step up in AUA growth, increasing our client
satisfaction and retention, driving operating leverage through a different
cost trajectory for the business and enabling sustainable operating margins
over the medium term.
In addition, combining the best of colleague and digital capability means that
improving the engagement of our colleagues is a fundamental enabler of our
future success.
HL is a financially robust business with a great heritage, and we are now on
the right course to execute on our strategy, capitalise on the significant
growth opportunities that lie ahead and create value for all our stakeholders.
Dan Olley
Chief Executive Officer
Financial Review
Assets Under Administration (AUA) and Net New Business (NNB)
6 months ended 6 months ended
31 December 2023 31 December 2022
£bn £bn
Opening AUA 134.0 123.8
Platform growth* 0.1 0.3
Net Movement to Active Savings* (0.4) (0.4)
Active Savings growth* 1.3 1.7
Total Net New Business 1.0 1.6
Market growth and other* 7.2 1.7
Closing AUA 142.2 127.1
*Platform growth, Net Movement to Active Savings, Active Savings Growth and
Market growth and other are alternative performance measures. See the Glossary
of Alternative Performance Measures on page 29 for the full definition.
As in FY23, the economic backdrop for retail investors has remained
challenging with inflation still high, higher interest rates impacting the
mortgage market and macro and geo-political issues weighing on investor
confidence. Against that backdrop, it is really encouraging to see new money
onto the platform for the SIPP and Fund & Share accounts increasing year
on year, however, flows into the ISA have been flat year on year and
withdrawals and money out overall has continued to increase contributing to
overall net new business of £1.0 billion (H1 2023: £1.6 billion) which is a
reduction on the prior year. In terms of product mix within our client base,
42% of our Platform AUA are held in Stocks and Shares ISA accounts, 34% in
SIPP (including drawdown) and 24% in General Investment Accounts (H1 2023:
ISA: 42%, SIPP: 33%, GIA: 25%).
Asset retention is highest in our SIPP products given the purpose of these
accounts, with lower levels of retention seen particularly over the last 2
years in Stocks and Shares ISAs as increasing interest rates have made Cash
ISAs more attractive and clients have used funds previously allocated to
investments to either pay down or fund increasing mortgage costs. Overall
asset retention rate for the period was 89.2% (H1 2023: 91.4%).
Total AUA increased by 12% to £142.2 billion at the period end, (H1 2023
£127.1bn) driven by net new business and positive market movement experienced
during both Q1 and Q2.
Engaging with clients and helping them to navigate the challenges of the
economic backdrop and to improve their financial engagement and resilience
remains a priority and we were pleased to welcome 20,000 net new clients to
our services in the first half (H1 2023: 31,000), growing our total active
client base to 1,824,000. Our client retention rate was broadly flat across Q1
and Q2 at 91.6% (H1 2023: 92.4%).
We now have 235,000 clients with an Active Savings account, (H1 2023 146,000),
representing 12.9% of our total active client base (H1 2023 8.3%).
Income Statement
6 months ended 6 months ended
31 December 2023 31 December 2022
£m £m
Revenue 368.2 350.0
Operating costs (200.0) (160.4)
Finance and other income 14.6 8.4
Finance costs (0.3) (0.4)
Profit before tax 182.5 197.6
Tax (47.3) (40.4)
Profit after tax 135.2 157.2
Profit before tax 182.5 197.6
Adjusted for:
Total strategic spend
- Strategic investment costs 21.7 14.3
- Intangible impairment 14.4 -
- Restructuring costs 2.9 -
Underlying profit before tax* 221.5 211.9
Tax on underlying profit* (57.3) (43.3)
Underlying profit after tax* 164.2 168.6
*Underlying profit before tax, Tax on Underlying profit, and Underlying profit
after tax for the period exclude £21.7 million of strategic investment costs,
intangible impairment of £14.4 million and restructuring costs of £2.9
million. See the Glossary of Alternative Performance Measures on page 29 for
the full definition.
Revenue
Total revenue for the period increased 5% to £368.2 million (H1 2023:
£350.0m), driven by both the growth in AUA across Funds, Shares and Active
Savings and a continuation of higher Net Interest Margin (NIM) given sustained
levels of higher interest rates.
The table below shows revenue, average AUA and margins during the period:
6 months ended 6 months ended
31 December 2023 31 December 2022
Revenue Average AUA Revenue margin* Revenue Average AUA Revenue margin
£m £bn bps £m £bn bps
Funds(1) 120.4 62.4(7) 39 117.9 59.5(7) 40
Shares(2) 72.4 52.6 28 70.2 47.4 30
Cash (NIM) (3) 132.8 12.3 216 121.6 14.5 168
HL Funds(4) 26.1 8.8(7) 59 27.0 8.2(7) 66
Active Savings(5) 8.5 8.6 20 3.2 5.6 11
Other(6) 8.0 (-) - 10.1 ( ) -
Double-count(7) - (8.7)(7) - - (8.1)(7) -
Total 368.2 136.0(7) 54 350.0 127.1(7) 55
* Revenue margin is an alternative performance measure, see the Alternative
Performance Measures glossary on page 29 for the full definition
1 Platform fees.
2 Stockbroking commission and equity holding charges.
3 Net interest earned on cash held in investment accounts.
4 Annual management charge on HL Funds, i.e. excluding the platform fee, which
is included in revenue on Funds.
5 Revenue from Active Savings earned as fees from partner banks and interest
earned on cash held in the Hub account.
6 Advisory fees and ancillary services (e.g. annuity broking, distribution of
VCTs)
7 HL Funds AUM included in Funds AUA for platform fee and in HL Funds for
annual management charge. Total average AUA excludes HL Fund AUM to avoid
double-counting.
Revenue on Funds increased 2.1% to £120.4m (H1 2023: £117.9m) reflecting the
4.9% increase in average AUA, with revenue margin reducing to 39bps as result
of the removal of platform fees from Junior ISAs (JISA) and the reduction in
platform fees on Lifetime ISAs (LISA) in March 2023. Funds AUA at the end of
the period was £65.1 billion (H1 2023: £59.6bn), 46% of total AUA in line
with prior year.
Revenue on Shares increased by 3% to £72.4m (H1 2023: £70.2m) and the
revenue margin of 28bps (H1 2023: 30bps) was at the lower end of our expected
range. Whilst average Shares AUA increased by 11% during the first half, deal
volumes continue to be subdued and decreased by 3% to 3.9 million (H1 2023:
4.0m). Shares AUA at the end of the period was £55.8 billion (H1 2023:
£47.1bn), 39.2% of total AUA, a modest increase on prior year.
Revenue on cash (NIM) increased in the period to £132.8m (H1 2023: £121.6m)
reflecting higher level of interest earned despite the expected ongoing
reduction in cash held. Cash held in Investment accounts was £12.1 billion as
at 31 December 2023 (8.5% closing AUA), a reduction of £1.0 billion during
the first half as clients either invested, chose to save via our Active
Savings offering or withdrew cash from the platform.
In December 2023, we received, along with 41 other UK platform providers, a
Dear CEO letter from the FCA as a follow up to their request for information
in July 2023.
With regard to platform cash, we retained 41% of interest received during the
period, and we estimate we will retain 36% of interest in the third quarter of
2024.
As of 10 January, we pass through the following interest rates to our clients:
Fund & Share Account 2.25% - 2.90%
Stocks & Shares ISA, JISA, and LISA 3.00% - 3.70%
SIPP 3.45% - 4.20%
Drawdown 3.65% - 4.55%
Our rates are competitive versus direct rates from high street banks with the
average bank easy access rate at 2.73% and we do not charge clients a separate
fee on cash. We are making further changes to our website navigation, content
and disclosures following our Consumer Duty reviews.
Revenue from HL funds was £26.1m during the period (H1 2023: £27.0m) with
Average funds under Management (AUM) up 7% versus last year, and with a margin
of 59bps that was at the top end of our guidance.
We now offer a broad range of HL funds;
· nine multi-manager funds which saw broadly flat AUM during the
period
· three Select equity funds demonstrating modest growth
· four new Portfolio funds which were launched during FY23 and
increased to £445m AUM during the period
· three new building block funds (HL Growth, US and Global
Corporate Bond) which saw AUA increase to £1,121m
· two new multi-index funds, both of which were launched in
November
A broad HL fund range is an important element of our value proposition as it
offers different solutions to clients to meet their varying levels of risk
appetite and specific diversification objectives. Our newer funds have a lower
pricing structure than the multi-manager funds and, as they build, will drive
margin compression in this revenue stream.
Active Savings has continued to make great progress, with revenues now at
£8.5 million (H1 2023: £3.2m) in the first half, reflecting the increase in
AUA, better commercial pricing and changes in the base rate. The average
margin throughout the period was 20bps (H1 2023: 11bps) and AUA has grown to
£9.1 billion (31 December 2022: £6.3bn) at the end of the period.
Other revenues (comprising advisory fees, and ancillary services such as
annuity broking, distribution of VCTs) have reduced partly due to decreases in
annuity broking and third-party commissions. Advisory fees are up 3% on the
prior year.
Underlying costs*
6 months ended 6 months ended
31 December 2023 31 December 2022
£m £m
Underlying cost Underlying cost
People costs* 90.3 81.5
Activity costs* 21.2 19.3
Technology costs* 24.0 17.2
Support costs* 27.1 28.1
Underlying costs (pre-FSCS) 162.6 146.1
Total FSCS levy (1.6) -
Underlying costs** 161.0 146.1
*Definitions are shown in the Glossary of Alternative Financial Performance
Measures on page 29.
**Underlying costs excludes £21.7 million of strategic investment costs,
intangible impairment of £14.4 million and restructuring costs of £2.9
million. See the Glossary of Alternative Performance Measures on page 30 for
the full definition.
Underlying costs
In line with guidance, underlying costs increased by 10.2% to £161.0 million
(H1 2023: £146.1m) reflecting the on-going impact of inflation, annualisation
of headcount growth in FY23 and increased technology spend.
People costs increased 10.7% to £90.3 million (H1 2023: £81.5m) reflecting
the annualisation of FY23 increases, wage inflation and headcount growth. Our
headcount during the period increased by 378 FTE to 2,404 FTE as at 31
December 2023, with 254 net new colleagues joining our Helpdesk and operations
functions as we focus on returning our service levels to our high standards.
Activity costs comprising marketing costs, dealing related costs, and payment
costs, increased 9.7% to £21.2 million (H1 2023: £19.3m). Dealing costs have
increased, with the benefit of renegotiated 3(rd) party contracts being more
than offset by a change in the mix to incorporate more overseas dealing. We
have also seen higher transaction costs of £1m in relation to increased flow
in Active Savings, however this is net of a saving of £0.5m as a result of
new payment options for clients adding money to the platform.
As expected, Technology costs have increased during the period by 40% to
£24.0 million (H1 2023: £17.2m) as a result of new software and data
licences as we start to stand up our Cloud capabilities and introduce new
functionality across the business as part of our Technology capability and
product build out. We have also seen software and support cost inflation
uplifts and an increase in users across the business during the period.
Support costs, which include legal and professional fees, office running
costs, depreciation and amortisation, decreased 3.4% to £27.1 million (H1
2023 £28.1m), primarily because the prior period included a one-off increase
to the dilapidations provision of £1.8 million.
Adjustments to underlying profit
Total strategic spend in the period was £24.7 million (H1 2023 £23.4m), of
which £21.7 million has been expensed in the year and £3.0 million
capitalised in line with our accounting policy. The level of spend has
increased as expected during FY24 as we continue to build momentum, commencing
new material programmes of work including on Service Transformation, driving
improvements to our Helpdesk client experience and efficiency in relation to
our Workplace product offering and in relation to the scalability and
efficiency of our core payment and reconciliation processes.
Additionally, as a result of a detailed review of our technology roadmap
during the period, we have recognised an impairment charge of £14.4m against
intangible assets previously capitalised. This includes £7.2m in relation to
software that was developed to support a client financial health check tool
and £7.2m on development of a tool to improve efficiency for Financial
Advisors for which there is now no intended future use.
During the period, we have incurred £2.9 million of spend in relation to the
reset of the Executive Leadership and Digital Leadership teams.
Profit and Earnings
During the period, £14.6 million (H1 2023: £8.4m) of Finance Income resulted
from higher interest rates applied to corporate cash held on deposit.
On an underlying basis, profit before tax increased by 5% to £221.5 million
(H1 2023: £211.9m). On a statutory basis profit before tax was down 8% to
£182.5 million (H1 2023: £197.6m) as a result of increased strategic spend
and other one-off items.
The effective tax rate for the period was 25.8% (H1 2023: 20.4%), reflecting
the increase in corporation tax from 19% to 25% in effect from April 2023. The
Group's tax strategy is published on our website at http://www.hl.co.uk
(http://www.hl.co.uk)
Earnings per share 6 months ended 6 months ended
31 December 2023 31 December 2022
£m £m
Operating profit 168.2 189.6
Finance and other income 14.6 8.4
Finance costs (0.3) (0.4)
Profit before tax 182.5 197.6
Tax (47.3) (40.4)
Profit after tax 135.2 157.2
Underlying profit before tax* 221.5 211.9
Tax on underlying profit* (57.3) (43.3)
Underlying profit after tax* 164.2 168.6
Weighted average number of shares for the calculation of diluted EPS 474.5 474.6
Diluted EPS (pence per share) 28.5 33.1
Underlying diluted EPS (pence per share)* 34.6 35.5
*Underlying profit before tax, Tax on underlying profit before tax, Underlying
profit after tax and Underlying diluted EPS for the period exclude
£21.7 million of strategic investment costs, intangible impairment of £14.4
million and restructuring costs of £2.9 million. See the Glossary of
Alternative Performance Measures on page 30 for the full definition.
Diluted EPS decreased by 14% from 33.1 pence to 28.5 pence, reflecting the
increase in Underlying profit being more than offset by the uplift in
strategic investment costs, impairment and one off cost of change and the tax
rate.
Underlying diluted EPS decreased by 3% from 35.5 pence to 34.6 pence as a
result of the tax rate change (See Glossary of Alternative Performance
Measures on page 30 for the full definition).
Capital and Liquidity management
Total attributable shareholders' equity as at 31 December 2023 increased to
£713.5 million (30 June 2023: £709.7m) with first half profitability more
than offsetting the Strategic spend resulting from the Investment programme
and payment of the 2023 final dividend.
In terms of liquidity, the Group's net cash position increased to £536.3
million (30 June 2023: £503.3m) during the period as long term deposits
maturing led to the receipt of cash and a change in working capital. Net Cash
generated from operations was £183.9 million, funding the majority of the
£136.4m 2023 final ordinary dividend. The cash position is stated before
funding the 2024 interim dividend of £62.6 million.
The Group's £75 million Revolving Credit Facility with Barclays Bank remained
undrawn.
Capital Management Framework and Dividend
In line with guidance, the Board has declared an increased interim dividend of
13.2 pence per share (H1 2023: 12.70 pence per share). The interim dividend
will be paid on 28 March 2024 to all shareholders on the register at 1 March
2024.
During the period, the Board has reviewed and agreed the capital management
framework for HL, taking into account the appropriate level of capital to be
held above the Regulatory Requirement, the level of organic investment
required to support the business plans for growth and efficiency, and the
importance of delivering sustainable and attractive shareholder returns.
The framework comprises four elements:
1. Maintaining a Robust Balance Sheet
Our priority continues to be maintaining robust financial health; holding a
management buffer above the regulatory minimum to support the businesses'
regulatory capital and liquidity requirements. The FCA's Investment Firm
Prudential Regime (IFPR) applies to the Group and HL completes this assessment
through the Group Internal Capital Adequacy and Risk Assessment (ICARA)
processes. The Regulatory Requirement is driven by factors set out in the
ICARA framework with the main drivers of material movement being the level of
AUA managed by HL and our internal assessment of the level of risk presented
within the business.
2. Investing for Growth and Efficiency
We will deploy capital for investment in the business to maintain and enhance
our platform capabilities through investment in people capability, technology
and innovation. Where appropriate, the Board may choose to selectively deploy
capital for inorganic growth to accelerate delivery of the strategy.
3. Ordinary Dividend Policy
Recognising the importance of shareholder returns, cash distributions to
shareholders will be primarily driven through our progressive ordinary
dividend. We will continue to give specific dividend guidance on an annual
basis whilst we are investing in the business through the Strategic Spend
programme through to FY26.
4. Other Capital Returns
Where the Board assesses there to be surplus capital available for
distribution after the above considerations have been taken into account, this
will be returned to shareholders as part of our full year annual cycle over
time. The specific mechanism for a return of surplus capital will be
determined should an additional return be deemed appropriate.
Directors' Responsibility Statement
The Directors confirm that these condensed interim financial statements have
been prepared in accordance with UK adopted International Accounting Standard
34, 'Interim Financial Reporting' and the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct Authority and that
the interim management report includes a fair review of the information
required by DTR 4.2.7R and DTR 4.2.8R, namely:
· an indication of important events that have occurred during the
first six months of the financial year and their impact on the condensed set
of consolidated financial statements, and a description of the principal risks
and uncertainties for the remaining six months of the financial year; and
· material related-party transactions in the first six months and
any material changes in the related party transactions described in the last
Annual Report.
The Directors of Hargreaves Lansdown plc are listed on page 33 of the Interim
Report and Condensed Consolidated Financial Statements 6 months ended 31
December 2023.
By order of the Board:
Amy Stirling
Chief Financial Officer
21 February 2024
Independent review report to Hargreaves Lansdown plc
Independent review report to Hargreaves Lansdown plc
Report on the condensed consolidated interim financial statements
Our conclusion
We have reviewed Hargreaves Lansdown plc's condensed consolidated interim
financial statements (the "interim financial statements") in the Interim
results for the six months ended 31 December 2023 of Hargreaves Lansdown plc
for the 6 month period ended 31 December 2023 (the "period").
Based on our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in all
material respects, in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority.
The interim financial statements comprise:
· the Condensed Consolidated Statement of Financial Position as at
31 December 2023;
· the Condensed Consolidated Income Statement and Condensed
Consolidated Statement of Comprehensive Income for the period then ended;
· the Condensed Consolidated Statement of Cash Flows for the period
then ended;
· the Condensed Consolidated Statement of Changes in Equity for the
period then ended; and
· the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim results for the six
months ended 31 December 2023 of Hargreaves Lansdown plc have been prepared in
accordance with UK adopted International Accounting Standard 34, 'Interim
Financial Reporting' and the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, 'Review of Interim Financial Information Performed by
the Independent Auditor of the Entity' issued by the Financial Reporting
Council for use in the United Kingdom ("ISRE (UK) 2410"). A review of interim
financial information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and, consequently, does not
enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express
an audit opinion.
We have read the other information contained in the Interim results for the
six months ended 31 December 2023 and considered whether it contains any
apparent misstatements or material inconsistencies with the information in the
interim financial statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on the review
procedures performed in accordance with ISRE (UK) 2410. However, future events
or conditions may cause the group to cease to continue as a going concern.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the directors
The Interim results for the six months ended 31 December 2023, including the
interim financial statements, is the responsibility of, and has been approved
by the directors. The directors are responsible for preparing the Interim
results for the six months ended 31 December 2023 in accordance with the
Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority. In preparing the Interim results for the six
months ended 31 December 2023, including the interim financial statements, the
directors are responsible for assessing the group's ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors either intend
to liquidate the group or to cease operations, or have no realistic
alternative but to do so.
Our responsibility is to express a conclusion on the interim financial
statements in the Interim results for the six months ended 31 December 2023
based on our review. Our conclusion, including our Conclusions relating to
going concern, is based on procedures that are less extensive than audit
procedures, as described in the Basis for conclusion paragraph of this report.
This report, including the conclusion, has been prepared for and only for the
company for the purpose of complying with the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority and for no other purpose. We do not, in giving this conclusion,
accept or assume responsibility for any other purpose or to any other person
to whom this report is shown or into whose hands it may come save where
expressly agreed by our prior consent in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
London
21 February 2024
Section 1: Results for the period
Condensed Consolidated Income Statement
for the period ended 31 December 2023
Note 6 months ended 31 December 6 months ended 31 December
2023 2022
£m £m
Revenue 1.1 368.2 350.0
Operating costs 1.3 (200.0) (160.4)
Operating profit 168.2 189.6
Finance and other income 1.4 14.6 8.4
Finance costs (0.3) (0.4)
Profit before tax 182.5 197.6
Tax 1.5 (47.3) (40.4)
Profit for the period 135.2 157.2
Attributable to:
Owners of the parent 135.2 157.3
Non-controlling interest - (0.1)
135.2 157.2
Earnings per share 1.6 28.5 33.2
Basic earnings per share (pence)
Diluted earnings per share (pence) 28.5 33.1
The results relate entirely to continuing operations.
After the Statement of Financial Position date, the Directors declared an
ordinary interim dividend of 13.2 pence per share payable on 28 March 2024 to
shareholders on the register at 1 March 2024.
Condensed Consolidated Statement of Comprehensive Income
for the period ended 31 December 2023
6 months ended 31 December 6 months ended 31 December
2023 2022
£m £m
Profit for the period 135.2 157.2
Total comprehensive income for the financial period 135.2 157.2
Attributable to:
Owners of the parent 135.2 157.3
Non-controlling interest - (0.1)
135.2 157.2
The results relate entirely to continuing operations
Notes to the Condensed Consolidated Statement of Comprehensive Income
for the period ended 31 December 2023
1.1 Revenue
Revenue represents fees receivable from financial services provided to
clients, management fees charged to clients and net interest income (see note
2.4 for further details regarding money held on behalf of clients). It relates
to services provided in the UK and is stated net of value added tax.
The largest source of revenue for the Group encompasses ongoing revenue, which
includes platform fees, fund management fees, net interest income, ongoing
advice charges and renewal commission.
The other source is revenue earned on individual transactions and is primarily
made up of fees on stockbroking transactions and advisory event driven fees,
referred to as initial advice charges in the table below. The price is
determined in relation to the specific transaction type and are frequently
flat fees. There is no variable consideration in relation to transactional
revenue.
Revenue
6 months ended 31 December 6 months ended 31 December
2023 2022
£m £m
Ongoing revenue
Platform fees* 135.3 134.4
Fund management fees 26.1 27.0
Ongoing advice charges 3.5 3.7
Active Savings revenue 8.5 3.2
Net interest income 132.8 121.7
Renewal commission 1.8 2.5
Transactional revenue
Fees on stockbroking transactions 56.5 54.6
Initial advice charges 2.0 1.7
Other transactional income 1.7 1.2
Total Revenue 368.2 350.0
*This figure includes an adjustment in relation to discounts provided to
clients on fees, which were previously offset against Other transactional
income, which are now considered to be more appropriately classified against
platform fees.
1.2 Segment information
Under IFRS 8, operating segments are required to be determined based upon the
way the Group generates revenue and incurs expenses and the primary way in
which the Chief Operating Decision Maker (CODM) is provided with financial
information. In the case of the Group, the CODM is considered to be the
Executive Committee.
It is the view of the Board and of the Executive Committee that there is only
one segment, being the direct wealth management service administering
investments in ISA, SIPP and Fund & Share accounts, and providing cash
management services for individuals and corporates. Given that only one
segment exists, no additional information is presented in relation to it, as
it is disclosed throughout these financial statements.
The Group does not rely on any individual customer and so no additional
customer information is reported.
1.3 Operating costs
Operating profit has been arrived at after charging:
6 months 6 months ended 31 December
ended 31 2022
December
2023 £m
£m
Depreciation of owned plant and equipment and right-of-use assets 4.1 4.1
Amortisation of other intangible assets 3.1 3.1
Impairment of intangible assets 14.4 -
Activity costs(2)
- Marketing costs 10.1 9.7
- Dealing and financial services costs 11.1 9.6
Technology costs(*) 24.8 18.0
Support costs(1)
- Legal and professional fees 20.7 16.8
- Office running costs 3.3 5.3
- Other operating costs 7.0 7.7
Staff (including contractors) costs 101.4 86.1
Operating costs 200.0 160.4
( )
(*) The line item description of this category has changed from the prior
period. Technology costs includes IT costs and data costs.
(1) Support costs includes costs previously known as legal and professional
fees and office running costs. Also included in support costs are compensation
and compliance costs, other finance costs, insurance costs and fair value
movements on investments (note 2.2).
(2) Activity costs now includes costs previously known as marketing costs and
dealing and financial services costs.
1.4 Finance and other income
6 months ended 31 December 6 months ended 31 December
2023 2022
£m £m
Interest on bank deposits 14.4 5.2
Other income 0.2 3.2
14.6 8.4
1.5 Tax
6 months ended 31 December 6 months ended 31 December
2023 2022
£m £m
Current tax: on profits for the period 46.6 40.4
Current tax: adjustments in respect of prior years - -
Deferred tax 0.8 0.1
Deferred tax: adjustments in respect of prior years (0.1) (0.1)
47.3 40.4
1.5 Tax (continued)
In addition to the amount charged to the Consolidated Income Statement,
certain tax amounts have been charged/(credited) directly to equity as
follows:
6 months ended 31 December 6 months
2023 ended 31
December
£m 2022
£m
Deferred tax relating to share-based payments - (0.2)
Current tax relating to share-based payments (0.8) 0.3
(0.8) 0.1
1.6 Earnings per share (EPS)
Basic earnings per share is calculated by dividing the profit attributable to
equity holders of the Company by the weighted average number of ordinary
shares in free issue during the period, including ordinary shares held in the
EBT which have vested unconditionally with employees.
Diluted earnings per share is calculated by adjusting the weighted average
number of ordinary shares outstanding by assuming the conversion of all
dilutive potential ordinary shares.
The weighted average number of anti-dilutive share options and awards excluded
from the calculation of diluted earnings per share was 1,443,260 as at 31
December 2023 (1,510,318 at 31 December 2022).
6 months ended 31 December 6 months ended 31 December
2023 2022
Earnings (all from continuing operations) £m £m
Earnings for the purposes of basic and diluted EPS - net profit attributable 135.2 157.3
to equity holders of the parent Company
Number of shares Number Number
Weighted average number of ordinary shares 474,318,625 474,318,625
Weighted average number of shares held by HL EBT and SIP
(603,101) (292,518)
Weighted average number of share options held in relation to shares held by HL 182,445 45,480
EBT which have vested unconditionally with employees
473,897,969 474,071,587
Weighted average number of shares for the purposes of basic EPS
Weighted average number of dilutive share options held by HL EBT and SIP that 564,668 527,453
have not vested unconditionally with employees
474,462,637 474,599,040
Weighted average number of shares for the purposes of diluted EPS
Earnings per share Pence Pence
Basic EPS 28.5 33.2
Diluted EPS 28.5 33.1
Section 2: Assets & Liabilities
Condensed Consolidated Statement of Financial Position
for the period ended 31 December 2023
Note As at 31 December Audited at 30
2023 June
2023
£m
£m
ASSETS:
Non-current assets
Goodwill 1.3 1.3
Other intangible assets 2.1 39.0 50.4
Property, plant and equipment 2.1 16.1 17.4
Deferred tax assets 2.1 2.6
58.5 71.7
Current assets
Investments 2.2 4.9 0.5
Trade and other receivables 2.3 664.0 836.9
Cash and cash equivalents 2.4 516.3 373.3
Current tax assets 5.5 3.4
1,190.7 1,214.1
Total assets 1,249.2 1,285.8
LIABILITIES:
Current liabilities
Trade and other payables 2.5 524.8 565.5
524.8 565.5
Net current assets 665.9 648.6
Non-current liabilities
Provisions 5.1 3.0
Non-current lease liabilities 5.8 7.6
Total liabilities 535.7 576.1
Net assets 713.5 709.7
EQUITY:
Share capital 3.1 1.9 1.9
Shares held by EBT (3.7) (6.4)
EBT reserve (3.7) (1.0)
Retained earnings 719.0 715.2
Total equity 713.5 709.7
2.1 Changes in capital expenditure since the last annual Statement
of Financial Position date
Capital expenditure
During the six months ended 31 December 2023, the Group acquired fixtures,
fittings, plant, equipment and software assets and internally generated
intangibles with a cost of £8.8 million (year to 30 June 2023: £23.4m).
During the period we impaired internally developed software for which there is
no longer an intended future use. These assets have been written off in full
and the net book value of £14.4m has been recorded in operating costs in the
Income Statement.
2.2 Investments
As at 31 December Audited at
2023 30 June
2023
£m
£m
At beginning of period 0.5 0.8
Purchases 5.6 2.0
Disposals (1.2) (2.3)
At end of period 4.9 0.5
Comprising:
Current asset investment - listed securities valued at quoted market price and 4.9 0.5
fund units priced daily
£4.9 million (30 June 2023: £0.5m) of investments are classified as held at
fair value through profit and loss. These investments are all Level 1 or Level
2 financial instruments in line with the fair value hierarchy under IFRS 7 and
there have been no transfers between levels in the period.
During the period, HLFM, the Group's fund management subsidiary, seeded two
new funds with £2m each. See note 5.1 for further details.
2.3 Trade and other receivables
As at Audited at
31 December 30 June
2023 2023
£m
£m
Financial assets:
Trade receivables 489.3 510.3
Term deposits 20.0 130.0
Accrued income 135.6 169.0
Other receivables 3.8 7.6
648.7 816.9
Non-financial assets:
Prepayments 15.3 20.0
664.0 836.9
Trade and other receivables comprise fees due from clients and counterparty
positions. They are subsequently measured at amortised cost using the
effective interest method less any expected credit losses. The financial
assets are held in order to collect the contractual cash flows and those cash
flows are payments of interest and principal only. The Group recognises
Expected Credit Losses (ECLs) relating to trade receivables in line with the
simplified approach per IFRS 9 and calculated based on the historic
information available from the preceding years alongside factors impacting the
individual debtors, economic conditions and forecast expectations. Impairment
losses are recognised immediately in the Income Statement.
Term deposits comprise cash deposits held by UK licensed banks for a period of
greater than three months, over which there is no recall during the term of
the deposit.
In accordance with market practice and accounting standards on trade date
accounting, certain balances with clients, Stock Exchange member firms and
other counterparties totalling £469.9 million (30 June 2023: £486.0m) are
included in trade receivables. These balances are presented net where there is
a legal right of offset and the ability and intention to settle net. The gross
amount of trade receivables is £652.9 million and the gross amount offset in
the Statement of Financial Position with trade payables is £183.1 million.
Other than these counterparty balances trade receivables primarily consist of
fees and amounts owed by clients and renewal commission, owed by fund
management groups. There are no balances where there is a legal right of
offset but not a right of offset in accordance with accounting standards, and
no collateral has been posted for the balances that have been offset.
2.4 Cash and cash equivalents
As at 31 December Audited at
2023 30 June
2023
£m
£m
Group cash and cash equivalent balances 516.0 368.0
Restricted cash - balances held by HL EBT 0.3 5.3
516.3 373.3
Cash and cash equivalents comprise cash in hand and demand deposits that are
readily convertible to a known amount of cash, subject to insignificant
changes in value and are holdings of less than three months or those over
which the Group has an immediate right of recall. The carrying amount of these
assets is approximately equal to their fair value.
At 31 December 2023, segregated deposit amounts held by the Group on behalf of
clients in accordance with the client money rules of the Financial Conduct
Authority amounted to £6,344 million (30 June 2023: £7,214m). In addition,
there were pension trust and Active Savings cash accounts held on behalf of
clients not governed by the client money rules of £5,992 million (30 June
2023: £6,224m). The client retains the beneficial interest in both these
deposits and cash accounts, and accordingly, they are not included in the
Statement of Financial Position of the Group.
2.5 Trade and other payables
As Audited at
at 31 December 30 June
2023 2023
£m £m
Financial liabilities:
Trade payables 468.5 487.4
Current lease liabilities 4.4 4.6
Other payables 23.1 38.0
496.0 530.0
Non-financial liabilities:
Deferred income 0.2 0.3
Accruals 22.0 26.5
Social security and other taxes 6.6 8.7
524.8 565.5
In accordance with market practice, certain balances with clients, Stock
Exchange member firms and other counterparties totalling £466.3 million (30
June 2023: £483.5m) are included in trade payables. As stated in note 2.3,
where we have a legal right of offset and the ability and intention to settle
net, trade payable balances have been presented net.
Other payables principally comprise amounts owed to staff as a bonus and
rebates due to the regulated funds operated by the Group. Accruals and
deferred income principally comprise amounts outstanding for trade purchases
and receipts from clients, where cash is received in advance of certain
services.
2.6 Contingencies
The Group operates in a highly regulated environment and, in the ordinary
course of business, provides information to various regulators and authorities
as part of informal and formal requests and enquiries. In addition, the Group
receives complaints or claims in relation to its services from time to time
brought by clients, investors or other third parties. These may be notified to
the Group or directly to third parties, such as the Financial Ombudsman
Service in the case of client and investor complaints investigated and not
upheld by the Group. These include enquiries, complaints and a threatened
claim relating to the LF Equity Income Fund (formerly the Woodford Equity
Income Fund).
The Company received a letter purporting to be a pre-action letter from a law
firm in March 2021. In June 2021, the Company rejected all the claims made for
lack of a substantive basis of claim. The Company is aware that the law firm
has since filed a claim form with the court against both Link Fund Solutions
Limited and Hargreaves Lansdown Asset Management Limited ("HLAM") for an
unspecified amount in October 2022. As at the date of issuing these financial
statements, the law firm has not yet confirmed that it has secured sufficient
funding to progress the claim, HLAM has not been served with the claim form
and no timetable has been set for the conduct of any claim.
2.6 Contingencies (continued)
All such matters are periodically reassessed, with the assistance of external
professional advisers where appropriate, to determine the likelihood of the
Group incurring a liability. There are inherent uncertainties in the outcome
of such matters and it is not practicable to reliably estimate the financial
impact if any, on the Group's results or net assets at the period end.
These matters have been re-assessed throughout the financial period and the
above statement is accurate as at the reporting date and up to the date of
issue.
Section 3: Equity
Condensed Consolidated Statement of Changes in Equity
for the period ended 31 December 2023
Attributable to the owners of the Parent
Share capital Shares held by EBT EBT reserve Retained earnings Total Non-controlling interest Total equity
£m £m £m £m £m £m £m
Audited at 30 June 2022 1.9 (3.6) (2.4) 579.2 575.1 (1.6) 573.5
Total comprehensive income(1) - - - 157.3 157.3 (0.1) 157.2
Change in ownership - - - (1.7) (1.7) 1.7 -
Employee Benefit Trust:
Shares sold in the period - 1.9 - - 1.9 - 1.9
Shares acquired in the period - - - - - - -
HL EBT share sale - - (1.9) - (1.9) - (1.9)
Reserve transfer on exercise of share options - - 3.2 (3.2) - - -
Employee share option scheme:
Share-based payments expense - - - 3.3 3.3 - 3.3
Current tax effect of share-based payments - - - (0.3) (0.3) - (0.3)
Deferred tax effect of share-based payments - - - 0.2 0.2 - 0.2
Dividend paid - - - (130.0) (130.0) - (130.0)
As at 31 December 2022 1.9 (1.7) (1.1) 604.8 603.9 - 603.9
Audited at 30 June 2023 1.9 (6.4) (1.0) 715.2 709.7 - 709.7
Total comprehensive income(1) - - - 135.2 135.2 - 135.2
Employee Benefit Trust:
Shares sold in the period - 2.7 - - 2.7 - 2.7
HL EBT share sale - - (2.7) - (2.7) - (2.7)
Employee share option scheme:
Share-based payments expense - - - 4.2 4.2 - 4.2
Current tax effect of share-based payments - - - 0.8 0.8 - 0.8
Deferred tax effect of share-based payments - - - - - - -
Dividend paid (note 3.2) - - - (136.4) (136.4) - (136.4)
As at 31 December 2023 1.9 (3.7) (3.7) 719.0 713.5 - 713.5
(1) Total comprehensive income includes profit for the period and the total
comprehensive income presented is equal to profit in both periods presented.
The shares held by the Employee Benefit Trust ("the EBT") reserve represents
the cost of shares in Hargreaves Lansdown plc purchased in the market and held
by the Hargreaves Lansdown plc EBT to satisfy options under the Group's share
option schemes.
The EBT reserve represents the cumulative loss on disposal of investments held
by the Hargreaves Lansdown EBT. The reserve is not distributable by the
Company as the assets and liabilities of the EBT are subject to management by
the Trustees in accordance with the EBT trust deed.
Non-controlling interests in the net assets of consolidated subsidiaries are
identified separately from the Group's equity therein. Non-controlling
interests consisted of the minority's proportion of the net fair value of the
assets and liabilities acquired at the date of the original business
combination and the non-controlling interest's change in equity since that
date. During the prior period, the Company purchased all of Stuart Louden's
7.5% shareholding in Hargreaves Lansdown Savings Limited and therefore at 31
December 2022 the Company had 100% control of the subsidiary.
Section 3: Equity
Notes to the Condensed Consolidated Statement of Changes in Equity
for the period ended 31 December 2023
3.1 Share capital As at 31 December As at 31 December
2023 2022
£m £m
Issued and fully paid:
Ordinary shares of 0.4p 1.9 1.9
Shares Shares
Issued and fully paid:
Number of ordinary shares of 0.4p 474,318,625 474,318,625
The Company has one class of ordinary shares which carry no right to fixed
income.
3.2 Dividends paid
As at 31 December As at 31 December 2022
2023
£m
£m
Amounts recognised as distributions to equity holders in the period:
2023 Final dividend of 28.8p per share (2022 - 27.44p) 136.4 130.2
2023 interim dividend of 12.70p per share - 60.2
Total 136.4 190.4
Under an arrangement dated 30 June 1997, the Hargreaves Lansdown Employee
Benefit Trust, which held the following number of ordinary shares in
Hargreaves Lansdown plc at the date shown, has agreed to waive all dividends.
As at 31 December As at 31 December
2023 2022
Number of shares held by the 442,696 197,460
Hargreaves Lansdown Employee Benefit Trust
Representing percentage of called-up share capital 0.09% 0.04%
Section 4
Condensed Consolidated Statement of Cash Flows
for the period ended 31 December 2023
Note As at 31 December As at 31 December
2023 2022
£m £m
Net cash from operating activities
Profit for the period after tax 135.2 157.2
Adjustments for:
Income tax expense 1.5 47.3 40.4
Depreciation of plant and equipment 1.3 4.1 4.1
Amortisation of intangible assets 1.3 3.1 3.1
Impairment of intangible assets 1.3 14.4 -
Investment income (14.6) (8.4)
Share-based payment expense 4.2 3.3
Interest on lease liabilities 0.1 0.2
Increase in provisions 2.1 1.8
Operating cash flows before movements in working capital 195.9 201.7
Decrease in receivables 62.9 17.2
Decrease in payables (40.7) (107.4)
Cash generated from operations 218.1 111.5
Income tax paid (48.8) (38.8)
Interest received 14.6 8.4
Net cash generated from operating activities 183.9 81.1
Investing activities
Decrease/(increase) in term deposits 110.0 (170.0)
(Purchase of)/Proceeds on disposal of investments (4.4) 0.1
Purchase of property, plant and equipment 2.1 (2.7) (1.6)
Cash capitalisation of intangible assets 2.1 (6.1) (10.5)
Net cash from/(used in) investing activities 96.8 (182.0)
Financing activities
Proceeds on sale of own shares in EBT - 0.1
Payments of principal in relation to lease liabilities (1.3) (2.1)
Dividends paid to owners of the parent (136.4) (130.0)
Net cash used in financing activities (137.7) (132.0)
Net increase/(decrease) in cash and cash equivalents 143.0 (232.9)
Cash and cash equivalents at beginning of period 2.4 373.3 488.3
Cash and cash equivalents at end of period (including restricted cash) 2.4 516.3 255.4
Section 5
Other Notes
as at 31 December 2023
5.1 Basis of preparation
This condensed consolidated interim financial report for the half-year
reporting period ended 31 December 2023 has been prepared using accounting
policies in accordance with UK-adopted International Accounting Standard 34,
'Interim Financial reporting' and the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct Authority. The
Interim Financial Statements have been prepared on the historical cost basis,
except for the revaluation of certain financial instruments, and are presented
in pounds sterling which is the currency of the primary economic environment
in which the Group operates. The accounting policies adopted are consistent
with those of the previous financial year and corresponding interim reporting
period.
The financial information contained in these Interim Financial Statements does
not constitute statutory accounts within the meaning of Section 434 of the
Companies Act 2006. However, the information has been reviewed by the
Company's auditor, PricewaterhouseCoopers LLP, and their report appears
earlier in this document. The financial information for the year ended 30 June
2023 has been derived from the audited financial statements of Hargreaves
Lansdown plc for that year, which have been reported on by
PricewaterhouseCoopers LLP and delivered to the Registrar of Companies. Copies
are available online at www.hl.co.uk (http://www.hl.co.uk) . The auditor's
report on those accounts was not qualified, did not include a reference to any
matters to which the auditor drew attention by the way of emphasis without
qualifying the report and did not contain statements under section 498 (2) or
(3) of the Companies Act 2006.
Going concern
Throughout the period, the Group was debt free, has continued to generate
significant cash, with £20m in term deposits at 31 December 2023 (see note
2.3) and has adequate financial resources available to meet its day-to-day
regulatory and working capital requirements.
The Directors have considered the resilience of the Group, taking account of
its current financial position, the principal risks facing the business in
severe but plausible scenarios and the effectiveness of any mitigating
actions. As a consequence, the Directors believe that the Group is well placed
to manage its business risks in the context of the current economic outlook
and has adequate financial resources to continue in operational existence for
a period of at least 12 months from the date of signing. Forecasts have been
considered and there are no material changes in the approach taken in
outlining the Group's viability as stated on pages 55 of the Group's Annual
Report and Financial Statements 2023, a copy of which is available on the
Group's website, www.hl.co.uk. The Directors therefore continue to adopt the
going concern basis in preparing the consolidated interim financial
statements.
The same accounting policies, methods of computation and presentation have
been followed in the preparation of the Interim Financial Statements for the
six months ended 31 December 2023 as were applied in the Audited Annual
Financial Statements for the year ended 30 June 2023.
Changes in the composition of the Group
During the prior period an agreement was reached to purchase Stuart Louden's
shares and as at 31 December 2022 the Company had 100% control of Hargreaves
Lansdown Savings Limited.
During the period Hargreaves Lansdown Fund Managers Ltd, the Group's fund
management subsidiary, made seed investments into two retail funds. These
funds are managed by the Group but are not consolidated into the Group at the
end of the period. The total value of these investments at 31 December 2023
was £4.2m.
Seasonality of operations
A high proportion of the Group's revenue is derived from the value of assets
under administration or management on the HL platform or within HL funds. The
values of these assets are influenced predominantly by new business volumes,
the stock market and client withdrawals.
Revenues are not considered to be seasonal, with approximately 52% of revenues
being earned in the second half of the financial year, based on previous
financial years. The Group revenue is however sensitive to the impact of net
new business inflows and interest rates during a particular period.
5.2 Material events after interim period-end
After the interim Statement of Financial Position date, an ordinary interim
dividend of 13.2 pence per share (H1 2023: interim dividend 12.70 pence)
amounting to a total dividend of £62.6 million (2023: £60.2m) was declared
by the plc Directors. These financial statements do not reflect this dividend
payable.
There have been no other material events after the
end of the interim period.
5.3 Principal risks and uncertainties
The principal risks and uncertainties which could impact the Group for the
remainder of the financial year are those detailed on pages 53 to 62 of the
Group's Annual Report and Financial Statements 2023, a copy of which is
available on the Group's website, www.hl.co.uk. These remain the principal
risks and uncertainties for the second half of this financial year and beyond;
the key ones of which are listed below and they are regularly considered by
the Board.
Strategic risks
· Failure to execute strategic plans
· Business Performance
Operational risks
· Technology
· Administration
· Regulatory compliance
· Financial crime
· Data management
· Products and proposition
· Operational Resilience
· Employee relations
· Change management
· Information security
Interest rate risk is the risk that the Group will be impacted by adverse
movements in rates associated with interest bearing assets and liabilities.
There is an exposure to interest rates on banking deposits held in the
ordinary course of business. At 31 December 2023 the value of such assets on
the Group Statement of Financial Position was £536.3 million (at 31 December
2022: £445.4m).
This exposure is continually monitored to ensure that the Group is maximising
its interest earning potential within accepted liquidity and credit
constraints. The Group has no external borrowings and as such is not exposed
to interest rate or refinancing risk on borrowings. Cash at bank, including
restricted cash, earns interest at floating rates based on daily bank deposit
rates, cash held on term deposits greater than 3 months, classified as
receivables earns interest at a fixed rate.
Given that a source of revenue is based on the value of client cash under
administration, the Group has an indirect exposure to interest rate risk on
cash balances held for clients, the balance of which was £12,336 million at
31 December 2023 (30 June 2023: £13,438m). These amounts are not included in
the Group Statement of Financial Position.
The below is an analysis of the impact of a change of 100bps (1.00%) in
interest rates on the revenue received in relation to client cash. This
calculation considers no other impacts on interest income, it is an isolated
adjustment to one input to our revenue stream and as such is not indicative of
a real change. The calculations assume the interest income has been earned
evenly over the period and that rates have changed in isolation in the period,
without any changes to balances or margin of interest earned by clients.
100bps has been chosen as it is illustrative of movements seen during the
financial year from the Bank of England, it is not an expectation of actual
changes.
As at 31 December
2023
£m
Net Interest Income +100bps (1.00%) 62.6
Net Interest Income -100bps (1.00%) (62.6)
The above disclosure is not intended as forward guidance or analysis and does
not take into account the behaviour of clients in relation to changes in
interest rates, nor does it forecast future cash holdings and the level of
pass through to clients. It is intended as a point in time indication of the
sensitivity of the net interest income revenue category in the reporting
period to unforeseen changes in the base rate.
5.4 Related party transactions
The Company has a related party relationship with its Directors and members of
the Executive Committee (the "key management personnel"). There were no
material changes to the related party transactions or arrangements during the
financial period; transactions are consistent in nature with the disclosure in
note 5.6 to the 2023 Annual Report.
As noted in note 5.1 the Group has made seed investments into two managed
funds in the period. Management fees received in respect of these funds were
nil in the period.
5.5 Financial instruments' fair value disclosure
The Group's investments are financial assets and are held at fair value
through profit or loss. There have been no transfers of assets or liabilities
between levels of the fair value hierarchy.
The following table provides an analysis of financial instruments that are
measured subsequent to initial recognition at fair value, grouped into Levels
1 to 2 based on the degree to which fair value is observable:
Level 1 Level 2 Total
Quoted prices Directly observable market inputs other than Level 1 inputs
£m £m £m
As at 31 December 2023
Financial assets at fair value through profit or loss
- Listed equities 0.7 - 0.7
- Daily priced fund units - 4.2 4.2
0.7 4.2 4.9
Audited at 30 June 2023
Financial assets at fair value through profit or loss
- Listed equities 0.5 - 0.5
0.5 - 0.5
The fair value of financial instruments traded in active markets is based on
quoted market prices at the end of the reporting period. Instruments included
in Level 1 comprise primarily equity investments and fund units entered into
on a counterparty basis.
The fair value of financial instruments that are not traded in an active
market (for example, over-the-counter derivatives) is determined by using
valuation techniques. These valuation techniques maximise the use of
observable market data, such as foreign currency exchange rates, where it is
available and rely as little as possible on entity-specific estimates. If all
significant inputs required to fair value an instrument are observable, the
instrument is included in Level 2.
Glossary of Alternative Performance Measures
Within the Interim Report and Condensed Financial Statements various
Alternative Performance Measures are referred to, which are non-GAAP
(Generally Accepted Accounting Practice) measures. They are used in order to
provide a better and more consistent understanding of the performance of the
Group and the table below states those which have been used, how they have
been calculated, why they have been used and how they reconcile to the
Financial Statements of the Group
Measure Calculation Why we use this measure Reconciliation
Underlying Activity costs Underlying cost related to stockbroking, financial services costs and This has been amended in the period to provide visibility of the costs that This measure is the same as the Activity Costs figures
marketing costs on a transactional basis related to the volume of activity are associated with both client numbers and transactional volumes, to allow
undertaken by our clients. comparison from year to year within note 1.3
Dividend per share (pence per share) Total dividend payable relating to a financial year divided by the total Dividend per share is pertinent information to shareholders and investors and N/A
number of shares eligible to receive a dividend. Note ordinary shares held in provides them with the ability to assess the dividend yield of the Hargreaves
the Hargreaves Lansdown Employee Benefit Trust have agreed to waive all Lansdown plc shares.
dividends (see note 3.2 to the consolidated financial statements).
Underlying People costs Underlying costs related to staff, the main driver in business. People costs are our largest cost category and our people are the key driver Equivalent to staff costs figure within note 1.3, less strategic investment
of our Business and our strategy. costs and restructuring costs totalling £11.1 million
Platform Growth The net value of new assets brought onto the platform less assets leaving the Provides the most useful measure of tracking, over time, the element of net N/A
platform, excluding cash placed with Active Savings. new business that is made up on assets brought onto the platform.
Net movement to Active Savings The net value of assets moving from the HL platform to Active Savings Separated out from Platform Growth to highlight the change in asset mix within N/A
the business and the retention provided by Active Savings.
Active Savings Growth The net value of new cash placed with Active Savings. Provides the most useful measure of tracking, over time, the element of net N/A
new business that is made up of cash brought into Active Savings
Market growth and other The underlying market movement and other retained investment income, including Provides the best measure for highlighting changes in the AUA that are not N/A
dividends reinvested on behalf of clients. directly impacted by client activity.
Net interest margin (bps) Revenue from cash divided by the average value of cash under administration, Provides the most comparable means of tracking, over time, the margin earned N/A
net of interest received by clients. on the cash under administration after
considering the amount received by clients.
Revenue margin (bps) Total revenue divided by the average value of assets under administration Provides the most comparable means of tracking, over time, the margin earned N/A
which includes the Portfolio Management Services assets under management held on the assets under administration and is used by management to assess
in funds on which a platform fee is charged. business performance.
Revenue margin from cash (bps) Revenue from cash (net interest earned on the value of client money held on Provides a means of tracking, over time, the margin earned on cash held by our N/A
the platform divided by the average value of assets under administration held clients.
as client money).
Revenue margin from funds (bps) Revenue derived from funds held by clients (platform fees, initial commission Provides the most comparable means of tracking, over time, the margin earned N/A
less loyalty bonus) divided by the average value of assets under on funds held by our clients.
administration held as funds, which includes the Portfolio Management Services
assets under management held in funds on which a platform fee is charged.
Revenue margin from HL Funds (bps) Management fees derived from HL Funds (but excluding the platform fee) divided Provides a means of tracking, over time, the margin earned on HL Funds. N/A
by the average value of assets held in the HL Funds.
Revenue margin from shares (bps) Revenue from shares (stockbroking commissions, management fees where shares Provides a means of tracking, over time, the margin earned on shares held by N/A
are held in a SIPP or ISA) divided by the average value of assets under our clients.
administration held as shares.
Revenue from shares - Stockbroking Commission Stockbroking commissions differs from Fees on Stockbroking Transactions, as it Provides a means of tracking, over time, the revenue earned on trading by our This is Fees on Stockbroking Transactions per Note 1.1, less £1.6m, which is
relates directly to client charges for trading clients. included in "Other Revenue" on page 9
Strategic investment costs The total Cost (excluding capitalisation), of the Strategic Investment Costs relating to the planning, commencement and undertaking of the digital See page 7
Programme including staff and professional fees relating to the planning, technology strategy and core growth initiatives, which include staff costs,
commencement and undertaking of the digital technology strategy, strategic professional fees and technology costs, that are considered separately to
growth initiatives and the cost of expanding associated compliance, reflect the impact on the results of the Group.
infrastructure and support functions.
Underlying support costs Underlying support costs includes legal and professional fees and office Provides an assessment of our other costs. The measure is the same as Support costs, within note 1.3, plus
running costs, including depreciation, amortisation and impairment and excluding strategic
operating lease rentals. Also included in underlying support costs are investment costs of £12.7 million
depreciation of owned plant and equipment, amortisation of other intangible
assets and impairment.
Underlying technology costs Costs associated with the use of third-party software and data feeds used in Provides a means of understanding the impact that increasing or changing our Technology costs per note 1.3, less strategic
the performance of daily business. proposition has on our costs.
investment costs of £0.8m
Underlying costs Operating costs less strategic investment costs, intangible impairment and Provides relevant information on the year-on-year cost of the underlying Operating costs per note
restructuring costs. business as we go through a period of significant strategic investment.
1.3 less £39.0m of strategic
investment costs, intangible impairment and restructuring costs
Underlying diluted earnings per share Underlying profit after tax divided by the weighted average number of ordinary The calculation of diluted earnings per share using statutory profit after tax N/A
shares for the purposes of diluted EPS adjusted for those costs that are related specifically to our strategic
investments.
Underlying profit after tax Profit after tax attributable to equity holders of the parent company Profit after tax includes costs that are part of strategic planning and Profit after tax per the
excluding strategic investment costs, intangible impairment and restructuring development. This measure helps to provide clarity between the profit of the
costs. business from period to period when those costs are not considered. This is Statement of
important as we go through a period of significant strategic investment.
Comprehensive income
after adding back strategic
investment costs, impairment of intangible assets, restructuring costs and
adjusting for a tax shield
effect, as shown on
page 10
Underlying profit before tax Profit before tax excluding strategic investment costs, intangible impairment Provides the best measure for comparison of profit before tax of the Profit before tax per the
and restructuring costs. underlying business performance as we go through a period of significant
strategic investment. Statement of
Comprehensive income
after adding back strategic
investment costs, impairment of intangible assets, restructuring costs as
shown
on page 10
General Information
EXECUTIVE DIRECTORS
Dan Olley
Amy Stirling
NON-EXECUTIVE DIRECTORS
Andrea Blance
Adrian Collins (non-independent as represents Peter Hargreaves)
Penny James
Moni Mannings
Michael Morley
Alison Platt
Darren Pope
John Troiano
COMPANY Secretary
Claire Chapman
INDEPENDENT AUDITOR
PricewaterhouseCoopers LLP, London
BROKERS
Barclays
Numis Securities Limited
REGISTRARS
Equiniti Limited
Registered Office
One College Square South
Anchor Road
Bristol
BS1 5HL
Registered number
02122142
WEBSITE
www.hl.co.uk
DIVIDEND CALENDAR
First dividend (interim)
Ex-dividend date* 29 February 2024
Record date** 1 March 2024
Payment date 28 March 2024
* Shares bought on or after the ex-dividend date will not qualify for the
dividend.
** Shareholders must be on the Hargreaves Lansdown plc share register on this
date to receive the dividend.
1 (#_ftnref1) Source HL Savings and Resilience Barometer. Comfortable
retirement per the Retirement Living Standards definition: £37,300 for a
single person and £54,500 for a couple (as of January 2024)
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