Hargreaves Lansdown plc (LON:HL) has today issued a trading update in respect of the quarter ended 31 March 2024 (Q3 FY24).
Total revenue of £199.7m in the quarter (Q3 2023: £188.1m) benefited from increased transaction volumes and higher platform revenue from higher AUA levels, more than offsetting the year-on-year decline in cash revenue from lower NIM and cash balances.
Net new business of £1.6 billion in the quarter (Q3 2023: £1.6 billion) came from net flows to the Platform as customers focused more on using their ISA and SIPP entitlements. Active Savings continued to perform well and benefited from the launch of its first-of-its-kind multi-bank cash ISA which provides customers with the full range of Cash ISA products (fixed term, easy access and limited access) from multiple banks.
Net customer growth of 34,000 in the quarter (Q3 2023: 23,000) was supported by net new customers in SIPP, ISA and Active Savings accounts. Customer retention at 91.4% (Q3 2023: 92.0%) and asset retention at 88.0% (Q3 2023: 89.1%) continued to reflect the macro backdrop for those of our customers need to make cash withdrawals.
Equity trading volume averaged 794,000 per month in the quarter (Q3 2023: 770,000) and there was an increase in volume from the first half of the financial year, with overseas trading volume accounting for 23.6% of total trading in the quarter (Q3 2023: 16.8%).
As expected, customer cash increased during the quarter as customers contributed to their tax bills ahead of the year-end tax deadline to £12.4bn (Q3 2023: £13.5bn)
Looking ahead to the rest of the financial year, the firm noted that it sees the momentum continuing into April as clients take advantage of the benefits of investing at the start of the tax year.
Dan Olley, CEO, commented:
“We welcomed 34,000 net new customers in the quarter, reflecting the growing popularity of our newer products such as ready-made pensions, our cash ISA offers and Active Savings. A record number of customers contributed to their pensions in the tax year, with the average amount subscribing by 22% and 270,000 of our customers now have an Active Savings account, taking Active Savings to the significant £10bn milestone at AUA since then at the end of the quarter.”