Hargreaves Lansdown reports record inflows, but revenue headwinds persist

20th May 2015 07:53

Bristol-based financial services provider Hargreaves Lansdown reported a record level of inflows over the first four months of 2015, helped by strong new business and client retention.However, shares fell on Wednesday as the company said that headwinds to revenues continued during the period.The ISAs, pensions, funds and stocks group said net inflows were £2.75bn in the four months to 30 April.Chief executive Ian Gorham said this was a "record for net inflows in any similar period in Hargreaves Lansdown's history, being 8% higher than the previous record set last year".The performance helped assets under administration (AuA) rise £6.2bn to £55.3bn over the period. The increase in assets was attributed to £2.7bn net new business inflows and a £3.4bn positive impact of the market as well as other growth factors, HL said.Total active client numbers increase 13% year-on-year to 715,000, while the client retention rate was high at 93.4%.Revenues since the start of HL's financial year (1 July) now total £241m, though this was up just 0.7% from £239.3m the year before. Lower interest rate margins compared to 2014.Gorham said that the new "pensions freedoms" available to the public from 6 April were a success, with the company experiencing "particular interest in pensions" since that date.He said HL has been one of the few companies in the UK fully ready to service the public at the start of pension freedoms. The company also experienced lower-than-expected withdrawals from pensions "as clients appear to be using the freedoms extremely sensibly, further evidence of the wisdom of trusting the British public with their own money", Gorham said.Analyst Paul McGinnis from Shore Capital said HL showed "good growth" in assets over the four-month period, though the revenue headwinds highlighted in the first half were still present and the year-to-date growth of 0.7% was tracking well below his full-year assumption of +4%.The stock was down nearly 1% at 1,268p by 08:17.