Wealth manager and SIPP provider Mattioli Woods has today reported a sharp rise in pre-tax profits by 45% to £4.8m in its interim results for the six months ended 30 November.
The company called its trading performance “resilient” against a tough backdrop.
Revenue for the six months was up 10% to £54.9m (1H22: £49.9m). Total clients assets, however, fell by 2% to £14.6bn.
The firm continues to diversify its revenues via its “integrated model” with 36% of revenues based on fee income (1H22 restated: 38%). This makes the firm less sensitive to AUM declines, it said.
Gross discretionary Assets under Management were £4.9bn, a 4% decrease in the period, with gross inflows down by £70.7m to £314.1m (1H22: £384.8m).
Recent acquisitions continued to “integrate well” helped by revenue from cross-selling and there is a “strong” pipeline of new acquisitions. The firm has made eight adviser firm acquisitions since the beginning of 2021.
The firm said the revenue contribution from acquisitions was £20.2m (1H22: £19.4m).
There was also progress with development of its digital business with the launch of the MWise online investment platform.
Despite the improvement in pre-tax profits, Mattioli said that adjusted EBITDA, a measure of profit, was down 5.1% to £15.0m (1H22: £15.8m) due to a change in the revenue mix and the market impact on revenues linked to asset values. The firm said other factors reducing EBITDA were the annualisation of employee benefit structure changes made in the prior year and investment to develop capacity.
The interim dividend is up 6% to 8.8p (1H22: 8.3p).
The company says it has a strong cash pile although this has fallen since the last set of figures from £53.9m in May 2022 to £38.3m at 30 November.
The firm said the outlook for the current year remains in line with management’s expectations and there will be continued focus on new business generation and improved operational efficiency complemented by “strategic acquisitions.”
Mattioli Woods CEO Ian Mattioli said: “The first six months of this financial year saw the group deliver a resilient trading performance against the challenging macroeconomic and geopolitical backdrop that persisted throughout calendar year 2022. During the period, we proactively balanced securing good financial outcomes for our clients with ensuring the long-term growth and sustainability of our business, remaining true to our purpose of putting clients first. We are pleased to report further progress towards our strategic medium-term goals, achieving continued revenue growth in the first half of this financial year.
“Revenue of £54.9m was 10% higher than the equivalent period last year (1H22: £49.9m) driven by positive performances in our pensions advice and administration, employee benefits, property management and private equity management operating segments.
“The success of our new business initiatives and the strength of existing client referrals resulted in organic revenue growth of over 2%, despite a 2% fall in the value of total client assets. Clients’ demand for advice and proactive communications by our advisers in such uncertain times resulted in an increase in advisory time, as well as the value of new clients on-boarded in the first half more than 10% higher than the equivalent period last year. The group’s strong, integrated business model facilitates multiple engagement points in providing a holistic service to our clients and to generate multiple revenue streams to facilitate future revenue growth.
“The eight acquisitions completed since 1 January 2021, including our two largest acquisitions to date, Maven and Ludlow, contributed £20.2m (1H22: £19.4m) of revenue in the period and continue to deliver revenue synergies.”
• In a trading update, personal injury and clinical negligence specialist adviser Frenkel Topping today reported revenues in line with expectations for the the financial year ended 31 December. The firm expects to report revenues of c.£24.8m (2021: £18.4m) and adjusted EBITDA of c.£6.1m (2021: £4.6m) for FY2022. The company had £5.0m of net cash at the year end and remains debt free. Assets Under Management have grown to £1,187m (2021: £1,174m) during the year and £129m of new AUM was added in the advisory business.
