24 November 2021
Brewin Dolphin Holdings PLC
Full Year Results
For the Year Ended 30 September 2021
Record discretionary fund inflows and delivering on our strategic growth ambitions
Strong financial performance
- Strong total discretionary net flows of £1.9bn (FY 2020: £0.9bn), representing an annualised growth rate of 4.6%.
– Record discretionary gross inflows of £4.0bn (FY 2020: £2.8bn), benefitting from strong brand advocacy, as well as a broad range of propositions and investment solutions.
– Discretionary net flows of £0.5bn from direct clients and £1.4bn from indirect clients, of which £1.0bn flowed into MPS and Voyager.
- Total funds increased by 19.5% over the last 12 months to £56.9bn (FY 2020: £47.6bn). Total discretionary funds increased 20.9% to £49.8bn (FY 2020: £41.2bn) driven by positive net flows and strong investment performance.
- Total income for the period increased by 12.3% to £405.9m (FY 2020: £361.4m) driven by strong market performance and record discretionary gross inflows.
– Financial planning income grew 25.7% to £41.6m (FY 2020: £33.1m), driven by both 1762 from Brewin Dolphin and the Wealth Core propositions.
- Adjusted1 PBT up 16.2% to £90.9m (FY 2020: £78.2m), with margin of 22.4% (FY 2020: 21.6%), driven by strong income growth and cost savings of £2.6m associated with COVID-19 restrictions.
- Strong cash balance of £188.0m (FY 2020: £180.5m) and capital adequacy ratio of 230%.
- Final dividend per share up 12.1% to 11.1p, taking total to 15.7p per share (2020 final: 9.9p per share, total 14.3p per share).
|
|
|
30 Sept |
Change |
|
Income |
405.9 |
361.4 |
12.3% |
|
Profit before tax and adjusted¹ items |
90.9 |
78.2 |
16.2% |
|
Statutory profit before tax |
72.5 |
62.1 |
16.7% |
|
Earnings per share |
|
|
|
|
Basic earnings per share |
18.8p |
16.3p |
15.3% |
|
Diluted earnings per share |
18.3p |
15.9p |
15.1% |
|
Adjusted1,2 earnings per share |
|
|
|
|
Basic earnings per share |
24.6p |
21.1p |
16.6% |
|
Diluted earnings per share |
23.8p |
20.6p |
15.5% |
1. Adjusted items are amortisation of client relationships and brand, onerous contracts, acquisition costs, incentivisation awards, defined benefit pension scheme past service costs and other gains and losses. See the Financial Review for an explanation of the adjusted measure.
2. See note 9 to the Financial Statements.
Delivering on our strategic priorities
- Custody and settlement system is now live and will parallel run with the existing system until summer 2022.
- Improved our digital capabilities; new BPS onboarding platform and piloting digital onboarding for intermediaries.
- Expanded our distribution channels; successful launch and continued momentum in Voyager funds, net flows of c.£300m.
- ESG investment solutions launched for our intermediaries and 1762 from Brewin Dolphin clients.
Outlook and guidance for FY 2022
- Well placed to serve the growing demand for financial advice and capture market share through widening our distribution channels, offering a broad range of propositions and investment solutions to all demographics.
- FY 2022 commission income expected to be similar to annualised Q4 2021.
- FY 2022 operating costs to grow mid to high single digit percent, due to wage inflation, parallel running of systems which will reverse in FY 2023, depreciation from recent technology investments and continued investment in the business to support future growth.
- Technology investment:
− FY 2022, final year of elevated capex spend estimated at c.£26m, of which £20m is on the final stage of integrating our new custody and settlement system with our other two internal systems whilst parallel running with the existing system.
− Post the completion of our large-scale technology project, normalised capex spend will be c.£10m per annum.
− Modern technology and an operational excellence programme will drive cost benefits of c.£1m in FY 2022 and c.£10m in FY 2023.
Robin Beer, Chief Executive, said:
“We have had an exceptional year achieving record discretionary inflows and are delivering on our growth ambitions. None of this would have been possible without our people, who have adapted so effectively to remote working and continue to focus on putting our clients at the centre of all their decision making. We have remained relevant by continuing to innovate our propositions whilst also developing our digital capabilities. We have started to drive operational efficiencies through our client management system and our new custody and settlement system is now live.
Looking ahead to FY 2022, our priority is to complete the final phased rollout of functionality for our new custody and settlement system, which will complete in summer 2022. On completion, with our new technology capabilities coupled with the operational excellence programme, we expect to capture significant synergies and benefits across the business, supporting our vision to deliver double digit earnings per share growth by 2025. We remain focused on becoming the leading advice-focused digitally enabled wealth manager in the UK and Ireland, which we believe will allow us to benefit from sector growth and capture market share.”
Declaration of Final Dividend
The Board is proposing a final dividend of 11.1p per share, to be approved at the 2022 AGM and to be paid on 9 February 2022 to shareholders on the register at the close of business on 7 January 2022 with an ex-dividend date of 6 January 2022.