REG - Hargreaves Lansdown - Interim results <Origin Href="QuoteRef">HRGV.L</Origin> - Part 2
06/02/2018 07:05
- Part 2: For the preceding part double click ID:nRSF9696Da
Number of shares Number Number Number
Weighted average number of ordinary shares 474,318,625 474,318,625 474,318,625
Weighted average number of shares held by HL EBT (381,494) (1,594,886) (926,356)
Weighted average number of share options held by HL EBT which have vested unconditionally with employees 611,223 893,358 1,010,585
Weighted average number of shares for the purposes of basic EPS 474,548,354 473,617,097 474,402,854
Weighted average number of dilutive share options held by HL EBT that have not vested unconditionally with employees 668,003 731,379 562,587
Weighted average number of shares for the purpose of diluted EPS 475,216,357 474,348,476 474,965,441
Earnings per share Pence Pence Pence
Basic EPS 25.0 22.4 44.7
Diluted EPS 25.0 22.4 44.6
Section 2: Assets & Liabilities
Notes to the Condensed Consolidated Statement of Financial Position
for the period ended 31 December 2017
Note Unauditedat 31 December2017 £m Unauditedat 31 December2016 £m Audited at 30 June 2017 £m
ASSETS:
Non-current assets
Goodwill 1.3 1.3 1.3
Other intangible assets 13.9 9.3 11.9
Property, plant and equipment 12.1 10.9 11.7
Deferred tax assets 2.6 3.4 2.0
29.9 24.9 26.9
Current assets
Trade and other receivables 2.3 573.0 353.7 628.8
Cash and cash equivalents 2.4 104.2 192.7 81.4
Investments 2.2 0.9 1.8 4.1
Derivative financial instruments 0.2 - 0.3
678.3 548.2 714.6
Total assets 708.2 573.1 741.5
LIABILITIES:
Current liabilities
Trade and other payables 354.5 314.0 411.5
Derivative financial instruments 0.1 - 0.2
Current tax liabilities 19.9 22.1 21.5
374.5 336.1 433.2
Net current assets 303.8 212.1 281.4
Non-current liabilities
Provisions 0.6 0.5 0.6
Total liabilities 375.1 336.6 433.8
Net assets 333.1 236.5 307.7
EQUITY:
Share capital 3.1 1.9 1.9 1.9
Shares held by Employee Benefit Trust reserve (5.5) (13.6) (7.0)
EBT reserve 7.3 10.5 7.9
Retained earnings 328.4 236.9 304.1
Total equity, attributable to the owners of the parent 332.1 235.7 306.9
Non-controlling interest 1.0 0.8 0.8
Total equity 333.1 236.5 307.7
2.1 Changes in capital expenditure since the last annual balance sheet
date
Capital expenditure
During the six months ended 31 December 2017, the Group acquired fixtures,
fittings, plant, equipment and software assets and internally generated
intangibles with a cost of £6.0 million (H1 2017: £5.0 million, year to 30
June 2017: £8.4 million).
2.2 Investments
Unaudited6 months ended 31 December2017 £m Unaudited 6 months ended 31 December2016 £m Audited Year to 30 June 2017 £m
At beginning of period 4.1 1.0 1.0
Sales (3.2) - (0.3)
Purchases - 0.8 3.4
At end of period 0.9 1.8 4.1
Comprising:
Current asset investment - UK listed securities valued at quoted market price 0.9 1.5 4.1
Current asset investment - Unlisted securities valued at cost - 0.3 -
£0.9 million (31 December 2016: £1.5 million, 30 June 2017: £4.1 million) of
investments are classified as held at fair value through profit and loss and
nil (31 December 2016: £0.3 million, 30 June 2017: nil) are classified as
available-for-sale.
2.3 Trade and other receivables
Unaudited6 months ended 31 December2017 £m Unaudited 6 months ended 31 December2016 £m Audited Year to 30 June 2017 £m
Financial assets:
Trade receivables 343.5 301.5 401.1
Term deposits 175.0 - 180.0
Other receivables 3.5 1.5 1.5
522.0 303.0 582.6
Non-financial assets:
Accrued income 45.9 46.0 40.0
Prepayments 5.1 4.7 6.2
573.0 353.7 628.8
Trade and other receivables are measured at initial recognition at fair value.
Appropriate allowances for estimated irrecoverable amounts are recognised in
profit or loss when there is objective evidence that the asset is impaired.
In accordance with market practice, certain balances with clients, Stock
Exchange member firms and other counterparties totalling £326.2 million (31
December 2016: £291.2 million, 30 June 2017: £378.6 million) 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 £394.3 million and the gross amount of offset in the
balance sheet with trade payables is £68.0 million. Other than counterparty
balances trade receivables primarily consist of fees and amounts owed by
clients. 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
Unaudited6 months ended 31 December2017 £m Unaudited 6 months ended 31 December2016 £m Audited Year to 30 June 2017 £m
Restricted cash - balances held by Hargreaves Lansdown EBT 4.2 2.9 5.5
Group cash and cash equivalent balances 100.0 189.8 75.9
104.2 192.7 81.4
Cash and cash equivalents comprise cash on hand and demand deposits held by
the Group that are readily convertible to a known amount of cash. The carrying
amount of these assets is approximately equal to their fair value.
At 31 December 2017 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 £8,719 million (31 December 2016: £7,423 million, 30
June 2017 £8,243 million). In addition there were currency service cash
accounts held on behalf of clients not governed by the client money rules of
£14.1 million (31 December 2016: £35.0 million, 30 June 2017 £13.4 million).
The client retains the beneficial interest in both these deposits and cash
accounts and accordingly they are not included in the balance sheet of the
Group.
2.5 Trade and other payables
Unaudited6 months ended 31 December2017 £m Unaudited 6 months ended 31 December2016 £m Audited Year to 30 June 2017 £m
Financial liabilities:
Trade payables 322.5 286.0 375.5
Social security and other taxes 4.8 3.8 8.0
Other payables 18.6 15.1 13.1
345.9 304.9 396.6
Non-financial liabilities:
Accruals 8.1 8.8 14.3
Deferred income 0.5 0.3 0.6
354.5 314.0 411.5
In accordance with market practice, certain balances with clients, Stock
Exchange member firms and other counterparties totalling £322.9 million (31
December 2016: £286.0 million, 30 June 2017: £374.9 million) 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. The gross amount of trade payables is £390.9 million and the
gross amount offset in the balance sheet with trade receivables is £68.0
million. 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.
Other payables principally comprise amounts owed to clients as a loyalty bonus
and to staff as a bonus. Accruals and deferred income principally comprise
amounts outstanding for trade purchases and revenue received but not yet
earned on group pension schemes where an ongoing service is still being
provided.
Section 3: Equity
Condensed Consolidated Statement of Changes in Equity
for the period ended 31 December 2017
Share capital Shares held by EBT reserve EBT reserve Retained earnings Total Non-controlling interest Total equity
£m £m £m £m £m £m £m
At 1 July 2016 1.9 (14.9) 12.0 254.6 253.6 0.5 254.1
Total comprehensive income - - - 106.0 106.0 0.3 106.3
Employee Benefit Trust:
Shares sold during the period - 4.2 - - 4.2 - 4.2
Shares acquired in the period - (2.9) - - (2.9) - (2.9)
EBT share sale - - (2.5) - (2.5) - (2.5)
Reserve transfer on exercise of share options - - 1.0 (1.0) - - -
Employee share option scheme:
Share-based payments expense - - - 1.3 1.3 - 1.3
Current tax effect of share-based payments - - - 0.2 0.2 - 0.2
Deferred tax effect of share-based payments - - - (0.4) (0.4) - (0.4)
Dividend paid (note 3.2) - - - (123.8) (123.8) - (123.8)
At 31 December 2016 1.9 (13.6) 10.5 236.9 235.7 0.8 236.5
At 1 July 2017 1.9 (7.0) 7.9 304.1 306.9 0.8 307.7
Total comprehensive income - - - 118.8 118.8 0.2 119.0
Employee Benefit Trust:
Shares sold during the period - 8.3 - - 8.3 - 8.3
Shares acquired in the period - (6.8) - - (6.8) - (6.8)
EBT share sale - - (2.7) - (2.7) - (2.7)
Reserve transfer on exercise of share options - - 2.1 (2.1) - - -
Employee share option scheme:
Share-based payments expense - - - 1.9 1.9 - 1.9
Current tax effect of share-based payments - - - 0.8 0.8 - 0.8
Deferred tax effect of share-based payments - - - 1.5 1.5 - 1.5
Dividend paid (note 3.2) - - - (96.6) (96.6) - (96.6)
At 31 December 2017 1.9 (5.5) 7.3 328.4 332.1 1.0 333.1
The share premium account represents the difference between the issue price
and the nominal value of shares issued.
The shares held by 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 Employee Benefit Trust to satisfy options under
the Group's share option schemes.
The EBT reserve represents the cumulative gain 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 consist 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. The non-controlling interest represents a 22% shareholding in Library
Information Services Limited and a 7.5% shareholding in Hargreaves Lansdown
Savings Limited, both subsidiaries of the Company.
3.1 Share capital Unaudited6 months ended 31 December2017 £m Unaudited 6 months ended 31 December2016 £m Audited Year to 30 June 2017 £m
Issued and fully paid:
Ordinary shares of 0.4p 1.9 1.9 1.9
Shares Shares Shares
Issued and fully paid:
Number of ordinary shares of 0.4p 474,318,625 474,318,625 474,318,625
474,318,625
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 Unaudited6 months ended 31 December2017 £m Unaudited 6 months ended 31 December2016 £m Audited Year to 30 June 2017 £m
Amounts recognised as distributions to equity holders in the period:
2017 Final dividend of 20.4p per share 96.6 - -
2017 First interim dividend of 8.6p per share - - 40.7
2016 Second interim dividend of 16.3p per share - 77.0 77.0
2016 Special dividend of 9.9p per share - 46.8 46.8
Total 96.6 123.8 164.5
The Hargreaves Lansdown Employee Benefit Trust (the "EBT"), which held the
following number of ordinary shares in Hargreaves Lansdown plc at the date
shown, has agreed to waive all dividends.
Unaudited6 months ended 31 December2017 Unaudited 6 months ended 31 December2016 Audited Year to 30 June 2017
Number of shares held by the Hargreaves Lansdown Employee Benefit Trust (HL EBT) 551,958 1,540,551 917,011
Representing % of called-up share capital 0.12% 0.32% 0.18%
Note Unaudited6 months ended 31 December2017 £m Unaudited6 months ended 31 December2016 £m Audited Year to 30 June 2017 £m
Net cash from operating activities
Cash generated from operations 4.1 145.5 130.3 270.5
Income tax paid (27.8) (18.5) (44.7)
Net cash generated from operating activities 117.7 111.8 225.8
Investing activities
Decrease/(increase) in term deposits 5.0 - (180.0)
Interest received 0.7 0.4 1.0
Dividends received from investments - - 0.2
Proceeds on disposal of investments 3.2 - 2.7
Purchase of property, plant and equipment (2.6) (1.7) (4.7)
Purchase of intangible assets (3.4) (3.3) (8.4)
Purchase of investments - (0.8) (3.4)
Net cash used in investing activities 2.9 (5.4) (192.6)
Financing activities
Purchase of own shares in EBT (6.8) (2.9) (2.9)
Proceeds on sale of own shares in EBT 5.6 1.6 4.2
Dividends paid to owners of the parent (96.6) (123.8) (164.5)
Dividends paid to non-controlling interests - - -
Net cash used in financing activities (97.8) (125.1) (163.2)
Net (decrease) in cash and cash equivalents 22.8 (18.7) (130.0)
Cash and cash equivalents at beginning of period 81.4 211.4 211.4
Cash and cash equivalents at end of period 2.4 104.2 192.7 81.4
4.1 Notes to the consolidated cash flow statement Unaudited 6 months ended 31 December2016 £m Audited Year to 30 June 2017 £m
Profit for the period after tax 106.3 212.0
Adjustments for:
Investment revenues (0.4) (1.2)
Income tax expense 24.6 53.8
Gain on disposal of investments (0.1) (3.5)
Depreciation of plant and equipment 1.8 3.8
Amortisation of intangible assets 1.1 2.3
Impairment of intangible assets - 1.2
Share-based payment expense 1.3 4.1
Increase in provisions - 0.1
Operating cash flows before movements in working capital 134.6 272.6
Decrease/(increase) in receivables 263.3 168.2
(Decrease)/increase in payables (267.6) (170.2)
Net derivative movement - (0.1)
Cash generated from operations 130.3 270.5
270.5
Section 5
Other Notes
as at 31 December 2017
5.1 Basis of preparation
The consolidated Interim Financial Statements of Hargreaves Lansdown plc for
the six months to 31 December 2017 have been prepared using accounting
policies in accordance with International Financial Reporting Standards
(IFRSs) as adopted by the European Union and in accordance with the
International Accounting Standard (IAS) 34 Interim Financial Reporting and
theDisclosure Rules and Transparency Rules 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 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 2017 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 on-line at 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.
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 2017 as were applied in the Audited Annual
Financial Statements for the year ended 30 June 2017.
Going concern
Throughout the period, the Group was debt free, has continued to generate
significant cash and has considerable financial resources enabling it to meet
its day-to-day 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 reasonable 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 have adequate financial resources to continue in operational existence for
a period of at least 12 months from the date of approval of these interim
financial statements. They therefore continue to adopt the going concern basis
in preparing the consolidated interim financial statements.
Seasonality of operations
A high proportion of the Group's revenue is derived from the value of assets
under administration or management in either the Vantage Service or the
Portfolio Management Service (PMS). The values of these assets are influenced
predominantly by new business volumes, the stock market and client
withdrawals.
As new business only accounts for a small proportion of asset values and
because of other revenue streams and market effects, overall Group net revenue
is less seasonal than new business inflows. In the year ended 30 June 2017 51%
of revenue was earned during the second half of the year (2016: 51%).
5.2 Material events after interim period-end
After the interim balance sheet date, an ordinary interim dividend of 10.10
pence per share (H1 2017: interim dividend 8.60p) amounting to a total
dividend of £47.9 million (2017: £40.7 million) 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 24 to 26 of the
Group's Annual Report and Financial Statements 2017, 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.
Operational risks
· Cybercrime, fraud or security breaches in respect of the Group's
information, data, software or information technology systems.
· Business continuity event.
· Changing markets and increased competition.
Financial risks
· Risk of a decline in earnings due to a decline in interest rates or
regulatory changes affecting interest income.
· Fluctuations in the capital markets adversely affecting trading
activity and /or the value of the Group's assets under administration.
The Group is exposed to interest rate risk, the risk of sustaining losses from
adverse movements in interest bearing assets. These assets comprise cash,
cash equivalents and term deposits. At 31 December 2017 the value of such
assets on the Group balance sheet was £279.2 million (at 31 December 2016:
£192.7 million). A 50bps (0.5%) move in interest rates, in isolation, would
therefore, not have a material direct impact on the Group balance sheet or
results. This exposure is continually monitored to ensure that the Group is
maximizing 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.
As a source of revenue is based on the value of client cash under
administration, the Group also has an indirect exposure to interest rate risk
on cash balances held for clients. These balances are disclosed in note 2.4
and are not on the Group balance sheet.
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 during the financial
period; transactions are consistent in nature with the disclosure in note 5.6
to the 2017 Annual Report.
5.5 Financial instruments' fair value disclosure
The fair values of the Group's financial assets and liabilities are not
materially different from their carrying values. There have been no transfers
of assets or liabilities between levels of the fair value hierarchy and there
are no non-recurring fair value measurements.
The following table provides an analysis of financial instruments that are
measured subsequent to initial recognition at fair value, grouped into Levels
1 to 3 based on the degree to which fair value is observable:
Level 1Quoted prices for similar instruments Level 2Directly observable market inputsother than Level 1 inputs Level 3Inputs not based on observable market data Total
£m £m £m
Unaudited at 31 December 2017
Financial assets at fair value through profit or loss 0.9 - - 0.9
Derivative financial assets - 0.2 - 0.2
Derivative financial liabilities - (0.1) - (0.1)
0.9 0.1 - 1.0
Unaudited at 31 December 2016
Financial assets at fair value through profit or loss 1.5 - - 1.5
Available-for-sale financial assets - - 0.3 0.3
1.5 - 0.3 1.8
Audited at 30 June 2017
Financial assets at fair value through profit or loss 4.1 - - 4.1
Derivative financial assets - 0.3 - 0.3
Derivative financial liabilities - (0.2) - (0.2)
4.1 0.1 - 4.2
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 counter-party basis. As such there is no recurring valuation of financial
instruments between reporting periods.
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 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.
General Information
EXECUTIVE DIRECTORS
Christopher Hill
Philip Johnson
NON-EXECUTIVE DIRECTORS
Chris Barling
Fiona Clutterbuck (appointed 1 September 2017)
Mike Evans
Shirley Garrood
Deanna Oppenheimer (appointed 2 February 2018)
Roger Perkin (appointed 1 September 2017)
Stephen Robertson
Jayne Styles
COMPANY Secretary
Judy Matthews
INDEPENDENT AUDITOR
PricewaterhouseCoopers LLP, London
SOLICITORS
Osborne Clarke LLP, Bristol
PRINCIPAL BANKERS
Lloyds Bank plc, Bristol
BROKERS
Barclays
Numis Securities Limited
REGISTRARS
Equiniti Limited
Registered Office
1 College Square South
Anchor Road
Bristol
BS1 5HL
Registered number
02122142
WEBSITE
www.hl.co.uk
DIVIDEND CALENDAR 2017/18
First dividend (interim)
Ex-dividend date* 15 February 2018
Record date** 16 February 2018
Payment date 9 March 2018
* 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.
Glossary of Alternative Performance Measures
Within the Interim Report and Condensed Financial Statements various
Alternative Financial Performance Measures are referred to, which are non-GAAP
(Generally Accepted Accounting Practice) measures. They are used in order to
provide a better understanding of the performance of the Group and the table
below states those which have been used, how they have been calculated and why
they have been used.
Measure Calculation Why we use this measure
Dividend per share (pence per share) Total dividend payable relating to a financial year divided by the total number of shares eligible to receive a dividend. Note ordinary shares held in the Hargreaves Lansdown Employee Benefit Trust have agreed to waive all dividends. Dividend per share is pertinent information to shareholders and investors and provides them with the ability to assess the dividend yield of the Hargreaves Lansdown plc
shares.
Operating Costs The costs as per the Income Statement excluding commission payable (i.e. the aggregate of staff costs, other operating costs and FSCS costs). In light of the transitional period relating to the Retail Distribution Review (see Net Revenue below) and the impact this had on commission payable in the form of
loyalty bonuses, this measure of Operating Costs provides a more useful comparative measure over time.
Operating profit margin Profits after deducting operating costs but before the impact of finance income and other gains or losses divided by revenue. Provides a measure of profitability of the core operating activities and excludes non-core items.
Net new business inflows Represents subscriptions, cash receipts, cash and stock transfers in less cash withdrawals, cash and stock transfers out. Provides a measure of tracking the success of gathering assets on to the platform over time.
Net revenue (£) (See Income Statement on page 11 for the reconciliation of net revenue) Total revenue less commission payments which are primarily loyalty bonuses paid to Vantage clients. Because of the changes brought about to the client charging structure by the Retail Distribution Review ("RDR") there was a transitional period (from 1 March 2014 to 1
April 2017). From 1 March 2014 revenue was increased as Hargreaves Lansdown earned both a new platform fee from clients and the existing renewal commission from the Fund
Management Groups based on the value of funds held by clients. At the same time the loyalty bonus paid to clients was significantly increased on the pre-RDR funds to
largely mitigate the impact of the new platform fee. In order to aid comparability during the period of transition to 1 April 2017 the net revenue measure became the most
useful comparative measure of revenue as it better reflected the underlying income relating to funds held by clients.
Net recurring revenue Net revenue that is received every month depending on the value of assets held on the platform including platform fees, management fees and interest earned on client money. Provides a measure of the quality of our earnings. We believe net recurring revenue provides greater profit resilience and hence is of higher quality than non-recurring
revenue.
Percentage of recurring net revenue (bps) The total value of renewal commission (after deducting loyalty bonuses), platform fees, management fees and interest earned on client money divided by the total net revenue. Provides a measure of the quality of our earnings. We believe recurring revenue provides greater profit resilience and hence it is of higher quality than non-recurring
revenue.
Net revenue margin (bps) Total net revenue divided by the average value of assets under administration which includes the Portfolio Management Services assets under management held in funds on which a platform fee is charged. Provides the most comparable means of tracking, over time, the margin earned on the assets under administration and is used by management to assess business performance.
Net revenue margin from cash (bps) Net revenue from cash (net interest earned on the value of client money held on the platform divided by the average value of assets under administration held as client money). Provides a means of tracking, over time, the margin earned on cash held by our clients.
Net revenue margin from funds (bps) Net revenue derived from funds held by clients (platform fees, initial commission less loyalty bonus) divided by the average value of assets under administration held as funds, which includes the Portfolio Management Services assets under management held in funds on which a platform fee is charged. Provides the most comparable means of tracking, over time, the margin earned on funds held by our clients.
Net revenue margin from HL Funds (bps) Management fees derived from HL Funds (but excluding the platform fee) divided by the average value of assets held in the HL Funds. Provides a means of tracking, over time, the margin earned on HL Funds.
Net revenue margin from shares (bps) Net revenue from shares (stockbroking commissions, management fees where shares are held in a SIPP or ISA, less the cost of dealing errors) divided by the average value of assets under administration held as shares. Provides a means of tracking, over time, the margin earned on shares held by our clients.
Transactional revenue Revenue that is non-recurring in nature and dependent on a client instruction such as a deal to buy or sell shares or take advice. Such revenue is not as high quality as recurring revenue but helps to show the diversification of our revenue streams.
This information is provided by RNS
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