Strong first quarter inspires confidence at investment platform AJ Bell

Andy Bell

Total net inflows of £1.3bn have provided a “solid start” to the new financial year for Manchester investment platform, AJ Bell.

In a first quarter update to December 31, 2021, this morning, the firm revealed the inflow figure, as well as a 27% rise in customer numbers over the past year, to 398,066, and a four per cent increase over the past three months.

Total assets under administration (AUA) increased to £75.6bn, up 21% over the past year and four per cent in the quarter. Over the same quarter the FTSE All-Share Index rose by 3.7%.

The firm said its performance was delivered against a very different market backdrop to that seen in the comparative quarter last year, when stricter government restrictions helped to drive AJ Bell’s total customer growth, gross inflows and net inflows to record levels.

The continued growth in quarter one, it said, evidences the resilience of the AJ Bell business model in different market conditions and was again driven by the company’s platform propositions and investment business.

Customer numbers in its platform business increased by 15,309 in the quarter to close at 383,274, up 29% in the past year and four per cent in the quarter

AJ Bell advised customers of 131,610, up 17% in the past year and four per cent in the quarter. Direct to consumer (D2C) customers of 251,664, were up 35% in the past year and four per cent in the quarter.

AUA closed at £68.1bn, up 23% in the past year and four per cent in the quarter.

There was gross inflows in the quarter of £2.7bn, up 23% on the prior year (2020: £2.2bn).

Net inflows of £1.4bn represented a seven per cent fall on the prior year’s £1.5bn figure. This was due to an exceptional bulk annuity purchase, previously signalled in the 2021 year-end trading update in October, which resulted in a one-off outflow of £241m from both advised platform AUA and AJ Bell Investments AUM in the quarter.

There was an advised net inflow of £0.6bn in the quarter. Excluding the impact of the exceptional outflow, underlying net inflows were £0.9bn, up 13% on the prior year’s £0.8bn figure.

D2C net inflows of £0.8bn in the quarter were up 14% on the £0.7bn prior year level.

AUM in AJ Bell Investments closed at £2.1bn, up 110% over the past year and down five per cent in the quarter due to the £241m exceptional outflow.

Excluding the impact of this one-off outflow, underlying net inflows in the quarter were £182m, compared with £147m in 2020.

Chief executive, Andy Bell, said: “We have had a solid start to our new financial year with customer numbers, gross inflows and assets under administration all growing steadily. We continue to see strong demand for our easy to use, low cost platform across both the advised and direct to consumer markets.

“In the advised market we had our second best quarter ever for customer acquisition with 4,690 net new advised customers added in the quarter, 38% more than in the same period last year. Gross inflows of £1.6bn to our advised platform were 23% higher than the comparative period and underlying net inflows were robust in what is normally a quieter period for asset flows.”

He said the direct to consumer market continues to grow strongly, with increasing numbers of people being drawn to the benefits of personal investing. In the quarter the firm delivered further growth in D2C customers and AUA and is now entrusted with more than £20bn of assets by a quarter of a million retail investors.

He added: “Our trusted brand and easy to use platform propositions, supported by our increasingly popular investment solutions, ensure that we are well positioned to deliver further growth in both the advised and D2C markets and we approach the traditionally busy tax year end period with optimism.”