Mattioli Woods, the wealth management and asset management business, has hailed growth in revenue and profit before tax in a trading update in advance of its interim results for the six months ended 30 November 2022.
It comes “despite the difficult economic and political complexities that persisted throughout the period.”
Revenue was up 10% to £54.9m at the Leicester firm, rising from £49.9m in the same period of the year prior. Gross discretionary assets under management (AuM) meanwhile saw a 4% decrease to £4.9bn.
Outlook for current year remains in line with management’s expectations.
Ian Mattioli MBE, Chief Executive, said: “The group delivered creditable revenue and profit before tax growth in the first six months of this financial year, despite the difficult economic and political complexities that persisted throughout the period.
“Our revenue model balances fee-based revenues for specialist advice and administration with revenues linked to the value of clients’ assets on an ad valorem basis, which has allowed the group to continue to grow and experience less sensitivity to movements from challenging investment markets.
“We continue to focus on securing good financial outcomes for our clients and putting them first in everything we do, whilst at the same time achieving both organic and acquisition based growth, and I am pleased to report further progress towards our medium-term goals. In the reporting period. The group has maintained profit margins through prudent cost management and in realising further operational efficiencies.
“Our pension and consultancy, employee benefits and private equity operating segments performed strongly during the period. Clients’ demand for advice and proactive communications by advisers with our clients in such uncertain times resulted in an increase in advisory time, with the value of new clients on-boarded in the first half over 10% higher than the equivalent period last year. 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.
“Our Maven private equity business made further strong progress during the period, enjoying healthy levels of new deal flow across all segments of the business, leading to increased transaction based revenues. Pleasingly joint-fundraising with the group became a feature of two recent Investor Partner deals generating significant fees through combining people talent and access to capital. Maven continues to enjoy a strong deal pipeline with a number of new tender opportunities during 2023 across the UK.
“Our investment and asset management business, like many others in the sector experienced some pressure on asset values, but our multi-asset funds continue to offer the highest level of diversification as we seek to manage volatility in these difficult investment markets.
“Our discretionary managed funds performed in line with their benchmarks and represented a combined value of £4.9 billion at the period end, including more than £1.0 billion managed by the group’s associate, Amati Global Investors. For the first half of the year, gross inflows into our discretionary managed funds were £314.1m (1H22: £384.8m), net inflows of £38.1m or 0.8% of opening AuM, with the balance of AuM influenced by market movements.
“During the period we continued to successfully integrate acquired businesses and our clients into the group. Of the nine acquisitions the group has made since July 2020, all are trading in-line or ahead of budget, and have delivered earnings to support full payment of any contingent consideration, building upon our track record of 34 successful acquisitions to date.
“Consolidation within the wealth management, pensions administration, asset management and financial planning sectors continues apace, and we continue to assess a strong pipeline of potential acquisition opportunities, with a disciplined approach, where all transactions are required to meet our strict investment criteria.
“Our trading outlook for the remainder of the financial year is in line with management’s expectations and the group remains well-positioned to deliver long-term sustainable shareholder returns.”
