HUB24 profits surge despite dip in inflows

HUB24 has posted an underlying net profit after tax (NPAT) of $26.6 million in the first half of the 2023 financial year (1H23), up 87% from $14.2 million in 1H22.

A 69% surge in operating revenue ($137.7 million) was offset by a 69% spike in operating expenses ($87.8 million).

As a result of the profitability improvement, earnings per share increased 59% to 18.9 cents.

The boost in HUB24’s underlying earnings came despite a 13% decline in net flows, from $6.7 billion in 1H22 to $5.8 billion.

Total funds under administration (FUA) grew just 7% to $73 billion, compared to 118% growth in 1H22.

Platform FUA increased 12% to $55.8 billion, offset by a 6% contraction in PARS FUA to $17.2 billion.

Three quarters of net inflows came via existing licensee and adviser relationships, followed by new adviser relationships (22%), and new licensee relationships (3%).

Despite weaker inflows, the group is confident it will reach its platform FUA targets over the medium term.

“As a result of our strong relationships and solid pipeline of opportunities, including 58 new distribution agreements signed and 206 new advisers using the platform in 1HFY23, we expect the growth momentum to continue and reaffirm the Platform FUA target of $80-89 billion for FY24,” HUB24 noted in its update to shareholders.  

Reflecting on the result, HUB24 CEO and managing director Andrew Alcock said he was pleased with the group’s overall 1H23 performance, which has produced a fully franked interim dividend of 14 cents per share, up 87% on 1H22.

“We are in a unique position to build on our success by leveraging our group capabilities and strong relationships to grow market share, capitalise on emerging opportunities and continue to create value for our customers and shareholders,” he said.