AJ Bell announces record business growth, with profit up 27%

New business inflows at AJ Bell grew 68% to £3.6bn during the first six months of its financial year (1 Oct 2016 – 31 March 2017) up from £2.1bn in the prior year.

Tax year end was particularly busy across both SIPP and ISA accounts, with AJ Bell recording over £1bn in new business inflows during the final month of the tax year.

Inflows were boosted by an increase in the rate of new customer acquisition, up 13% when compared with the first six months of the previous financial year. This strong flow of new business helped to increase Assets Under Administration by over 14% to a new record high of £36.3bn (30 Sept 2016: £31.8bn).

Financial performance was strong during the six month period.  The growth in the business saw revenue increase by 24% to £37.0m and profit before tax increase by 27% to £11.2m, up from £8.8m in the prior year. 

This strong growth was driven predominantly by AJ Bell’s core platform propositions which have significant momentum as a result of favourable market dynamics and its focus on meeting the needs of advisers and customers.

The advent of pension freedoms two years ago has led to growing demand for low cost and flexible SIPPs and income drawdown solutions, a core strength for AJ Bell. 

AJ Bell completed its re-platforming project in 2014 which has given it a stable and scalable technology platform to support advisers.  It continues to use its strong financial position to invest in the platform in line with feedback from advisers, as well as the technical support and customer services functions that underpin the platform and help advisers provide a first class service to their clients.

During the period AJ Bell made its first move into investment management with the launch of the AJ Bell Passive fund range - five low-cost, multi-asset funds, which followed the launch of its Managed Portfolio Service in August 2016.  Both investment propositions have been well received by the market and are expected to contribute further to AJ Bell’s growth.                        

Andy Bell, chief executive at AJ Bell, comments:

“These results reflect serene progress in an increasingly disrupted and turbulent platform market.  Many platforms are wrestling with re-platforming or platform migration projects and this will be disruptive for their users.  That is now a dot in our rear view mirror and our focus remains on helping advisers grow their businesses.

“We know that profitability and financial stability have become a core focus for advisers when selecting platforms so we are pleased to be able to demonstrate strong momentum on that front.  We continue to invest heavily in the platform and the functionality that supports advisers and customers.  Our mantra of making it easy for people to invest means that everything we do has the needs of advisers and customers at its core.

“Our latest initiative during this period has been the launch of our managed portfolio service and our new range of passive funds.  This is an exciting addition to our platform services and has been well received by advisers and customers looking for low cost, passive investment solutions that can be used as core portfolio holdings.”