Nucleus reports further growth in first quarter

Wrap platform provider Nucleus said it continued to grow assets under administration in its first quarter on Tuesday, with the total rising 28.4% year-on-year and 3.1% quarter-on-quarter to £18.0bn at period end on 31 March.

By comparison, the FTSE All-Share Index increased 23.3% year-on-year and by 4.3% on the last quarter.

The AIM-traded firm achieved gross inflows of £637m in the first quarter, with March its “best ever month” for inflows.

That represented a 29.5% increase on the prior quarter as sentiment continued to improve, and a 9.8% increase on the first quarter of 2020.

Net inflows totalled £301m, with March being its second best ever month, which was up 44.7% against the prior quarter and ahead 12.3% over the prior year.

Advisers actively using the platform increased 1.9% year-on-year, and customer numbers improved 3.1% over the same period in 2020.

Nucleus reported the “successful integration” of its new colleagues following the December transaction with Genpact.

Following a successful soft launch period in the second half of 2020, the first quarter saw the full rollout of its new model portfolio service ‘Nucleus IMX’, which had already become the third-highest discretionary managed portfolio service for net inflows from existing users on the Nucleus platform in the first quarter.

The board said the firm was making “further and continued” investment in the platform, which led to enhancements to its phased drawdown functionality and improvements to client documentation in the period, and would shortly see the introduction of next-day payments.

Nucleus said it had the largest year-on-year increase in score across all platforms in the latest Platforum User Leaderboard in March, to move into fifth place, and was the only platform to score an increase in performance across all categories.

“The first quarter has been incredibly strong for new business activity, reflecting the continued achievements of our people and validating our decision to maintain our investment programme through 2020,”said founder and chief executive officer David Ferguson.

“First quarter net inflows were substantially up on the fourth quarter, and on the prior year, and at over £300m for the first time in a single month, March was by far our best-ever month for inflows, a trend we'd hope to see continue as lockdown eases.”

Ferguson said user satisfaction was continuing to improve following the successful acquisition and integration of its new colleagues from OpenWealth.

“We are pleased with our first quarter performance.

“Profit for the year to date is ahead of the board's expectations as a result of higher assets under administration and lower costs, and we believe the business is well-positioned to accelerate inflow momentum and to expand our operating margin through the rest of this year and beyond.”

At 1432 BST, shares in Nucleus Financial Group were up 0.01% at 185.01p.