Hargreaves Lansdown beats on full-year topline growth, hikes dividend

Hargreaves Lansdown posted a much better than expected full-year performance, contributing to a hike in its dividend payout.

Revenues over the year ending on 30 June grew by 15% to £550.9m (consensus: £531m), driving an 11% jump in underlying profits before tax to £339.5m.

Assets under Administration meanwhile printed at £104bn (consensus: £102.6bn) thanks to better market performance.

Net new business flows of £7.7bn were as expected.

Statutory profits before tax were up 24% to £378.3m following the sale of its Funds Library unit, for a 27% increase in diluted earnings per share to 65.9p (consensus: 51.4p).

The total dividend payout meanwhile was 31% higher than in 2019 at 54.9p per share (consensus: 45.4p) with Hargreaves's board having declared a final dividend of 26.3p and a special payout of 17.4p.

Nevertheless, commenting on the firm's results, analysts at Jefferies said: "AUA came in ahead of consensus, boding well for future estimates, while revenues and costs were roughly in line.

"Underlying operating income was a shade below consensus, but the sale of FundsLibrary has flattered the bottom line, and we expect this will outshine the continuing reduction in fee margins. The high dividend will be attractive, particularly when so many are being cut, but our longer-term view remains negative."

As of 0827 BST shares of Hargreaves Lansdown were 3.45% higher to 1,888.0p.