Hargreaves Lansdown : Q3 Trading Update 30 April 2024

Trading update

30 April 2024

Hargreaves Lansdown plc today issues a trading update in respect of the three months ended 31 March 2024.

Highlights

• Good momentum into tax year end with increased gross inflows, net new clients and share dealing volumes.
• Net new business of £1.6 billion in the period and closing Assets under Administration ("AUA") a record £149.7 billion.
• Net new clients of 34,000 in the period, up 48% year on year, taking us to 1,858,000 active clients.
• Revenue for the period of £199.7 million, up 6% (Q3 2023: £188.1m).

Dan Olley, Chief Executive Officer, commented:

"On joining the business, one of the highest priorities I set was to recapture our service excellence, so I am delighted that we delivered a great service experience for our clients over tax year end despite receiving record volumes in calls and emails. We saw a significant rise in the service Net Promoter Score, up to +48 from +33.

"Our relentless focus on client service, making it easy to save and invest to ensure that we meet our clients' needs has delivered clear results this quarter. We built good momentum into tax year end, and as a result have seen year-on-year increases of gross inflows and share dealing volumes in the quarter and net new business on a par with last year.

"We welcomed 34,000 net new clients in the quarter, reflecting the increasing popularity of our newer products such as ready-made pensions, our cash ISA offerings and Active Savings. A record number of clients contributed to their pensions in the tax year, with the average amount subscribed up by c22% and 270,000 of our clients now have an Active Savings account, resulting in Active Savings reaching the significant milestone of £10 billion in AUA since the end of the quarter."

Trading performance

• Net new business of £1.6 billion in the quarter (Q3 2023: £1.6bn), reflects a significant step up versus the first half of the year driven by net flows on to the Platform as clients focused more on utilising their ISA and SIPP allowances. Active Savings continues to perform well and benefited from the launch of the first of its kind multi-bank cash ISA which provides clients with the full suite of Cash ISA products (fixed-term, easy access and limited access) from multiple banks.
• Net client growth of 34,000 in the quarter (Q3 2023: 23,000) driven by net new clients in the SIPP, ISA and Active
  Savings accounts. Client retention at 91.4% (Q3 2023: 92.0%) and asset retention at 88.0% (Q3 2023: 89.1%) continues to reflect the macroeconomic backdrop for those of our clients who need to make cash withdrawals.
• Share dealing volumes averaged 794,000 per month in the quarter (Q3 2023: 770,000) and an increase in volumes seen since the first half of the year, with overseas deal volumes representing 23.6% of total deals in the quarter (Q3 2023: 16.8%).
• As expected, client cash balances increased during the quarter as clients contributed to their tax wrapped accounts ahead of the tax year-end deadline to £12.4 billion (Q3 2023: £13.5bn)
• Total revenue in the quarter of £199.7 million (Q3 2023: £188.1m) benefits from increased dealing volumes and higher platform revenue from higher AUA levels, more than offsetting the year on year reduction in revenue on cash from lower NIM and cash balances.

Looking ahead to the remainder of the financial year, we are pleased to see momentum continue into April as clients take advantage of the benefits of investing at the start of the tax year.

We continue to make good progress against our priorities for the year - improving our client proposition, controlling our costs and increasing our execution pace so that we can capitalise on the significant growth opportunities that lie ahead and create value for all our stakeholders.

Financial calendar

A fourth quarter trading update will be issued on 19th July 2024 and then the full year results will be issued on 9th August 2024. Our Annual General Meeting is set for 22nd October 2024.

Contacts:
Investors	Media
James Found, Head of Investor Relations	Danny Cox, Head of Communications
[phone]	[phone]
	Lucy Thomas, Corporate Affairs Director
	[phone]

Forward looking statements

This announcement contains forward-looking statements with respect to the financial condition, results and business of the Group. By their nature, forward- looking statements involve risk and uncertainty because they relate to events, and depend on circumstances, that will occur in the future. The Group's actual results may differ materially from the results expressed or implied in these forward-looking statements. Nothing in this announcement should be construed as a profit forecast. This announcement is unaudited. This statement should not be seen as a promotion or solicitation to buy Hargreaves Lansdown plc shares. It should be remembered that the value of shares can fall as well as rise and therefore you could get back less than you invested.

LEI Number: 2138008ZCE93ZDSESG90

Revenue, clients and share dealing volumes

Key metrics			3 months to 31		3 months to 31	3 months to 30	3 months to 30		3 months to 31
			March 2024		December 2023	September 2023	June 2023		March 2023
Revenue (£m)	199.7	184.4	183.8		197.0	188.1
Net new clients	34,000	12,000	8,000		13,000	23,000
Total		1,858,000	1,824,000	1,812,000		1,804,000	1,791,000
active clients
Client Retention	91.4	91.6	91.7		92.0	92.0
Rate (%)
Asset Retention	88.0	89.3	89.0		89.7	89.1
Rate (%)
Share dealing	794,000	672,000	634,000		685,000	770,000
volumes per
month
Assets under administration
AUA (£billion)		3 months to 31		3 months to 31	3 months to 30	3 months to 30		3 months to 31
			March 2024		December 2023	September 2023	June 2023		March 2023
Opening AUA		142.2	134.8	134.0		132.0	127.1
Net new business		0.9	(0.2)	(0.1)		0.9	0.9
- platform
Net new business		0.7	0.6	0.7		0.8	0.7
- Active Savings
Total net new		1.6	0.4	0.6		1.7	1.6
business
Market			5.9	7.0	0.2		0.3	3.3
movements and
other
Closing AUA			149.7	142.2	134.8		134.0	132.0
Closing	AUA		As at 31		As at 31	As at 30		As at 30		As at 31
(£billion)			March 2024		December 2023	September 2023		June 2023		March 2023
Funds		68.8		65.1	61.9		62.2		61.6
Shares		58.5		55.8	51.9		50.8		49.8
Cash		12.4		12.1	12.4		13.1		13.5
HL Funds		9.8		9.2	8.7		8.7		8.6
Active Savings	9.9		9.1	8.5		7.8		7.0
Double count1	(9.7)		(9.1)	(8.6)		(8.6)		(8.5)
Total		149.7		142.2	134.8		134.0		132.0
Average AUA		3 months to 31		3 months to 31	3 months to 30		3 months to 30		3 months to 31
(£billion)			March 2024		December 2023	September 2023		June 2023		March 2023
Funds		66.9		62.3	62.6		62.1		61.8
Shares		56.4		52.9	52.2		50.4		50.1
Cash		12.2		12.1	12.5		13.4		13.6
HL Funds		9.5		8.8	8.8		8.7		8.6
Active Savings	9.6		8.9	8.3		7.5		6.8
Double count1	(9.4)		(8.7)	(8.7)		(8.6)		(8.5)
Total		145.2		136.3	135.7		133.5		132.4

1 All HL Funds are held in Vantage or the Portfolio Management Service (PMS) and are included in the Funds category of the table with the exception of a small balance held off platform by third parties. To avoid double counting the amount held in Vantage or PMS has been deducted.