Record dealing volumes fuel Hargreaves Lansdown’s revenues
Hargreaves Lansdown enjoyed record dealing activity in March and April, as market volatility helped to push revenues up 13 per cent.
The coronavirus-induced turbulence over the past two months saw Hargreaves Lansdown reach new daily records and monthly dealing levels more than double the highs experienced before in this period.
The figures
Revenue for the first four months of the year was £190.2m, up from £159.5m in the same period last year. It brings the year to date revenue to £448.1m, a 13 per cent increase on last year.
Net new business was £4bn during this period, taking year to date net inflows to £6.3bn. Hargreaves Lansdown added 94,000 new clients, taking the total active client numbers to 1.4m.
Why it’s interesting
The company said the period had two distinct phases where revenues initially benefited from a greater level of assets under administration (AUA) at the beginning of the year and a higher cash revenue margin.
However, at the start of March, the coronavirus-induced market volatility, and the subsequent emergency rate cuts, “negatively impacted asset-related revenue streams.” The impact of this was offset by higher stock broking revenues driven by record dealing activity.
The firm said the market turbulence in March helped accelerate new business, as existing clients added money to their accounts. New clients also joined to take advantage of the opportunity to invest at lower prices.
What Hargreaves Lansdown said
Chief executive Chris Hill said:
In these challenging times, it is critical we can support people in managing their investments and savings according to their desired outcomes. Retail investors have a vital role to play in the recovery and I would like to thank all of our clients for their continued support.
There remains much uncertainty in the coming months and hence, like many businesses, we cannot predict levels of new business or client activity. However, we are confident that the strategy we have invested in, with our focus on the needs of UK investors and savers and delivering the highest level of client service, means that we are well positioned to deliver continued attractive long-term growth.”