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Netwealth sees FUM growth as it pursues ‘emerging’ opportunities

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As of 31 December, the funds under administration (FUA) stood at $78 billion, with 31.9 per cent of the wealth held by high-net-worth advised individuals and 62 per cent held by retail clients.

In an announcement to the ASX on Tuesday, Netwealth reported that its FUA had increased to $78 billion as of 31 December, up $15.6 billion (24.9 per cent) compared with the previous year. This included net inflows of $9.5 billion and positive market movement of $6.0 billion.

Expanded to 16 February, Netwealth said its FUA had increased further and now sits at $80.8 billion.

Over the first half of FY2024, FUA net inflows were $4.7 billion.

Its non-custodial FUA saw net inflows of $91 million in the first half, reaching $228 million.

“Since its launch, the non-custodial administration service has been steadily gaining support and recognition across the industry,” Netwealth said.

The business also had funds under management (FUM) as at 31 December 2023 of $18.1 billion, up $3.6 billion, or 25.2 per cent, from 31 December 2022.

Netwealth’s managed account balance also saw significant growth, up 26.9 per cent or $3.3 billion to $15.5 billion, consisting of net inflows of $2.0 billion and market movement of $1.2 billion.

According to the Netwealth announcement, there were 132,826 client accounts as of 31 December, an increase of 11,794 accounts or 9.7 per cent from the first half of FY23. The average account size also increased to $560,000, up from $506,000.

Total revenue hit $123.3 million for the first half of FY24, up $20.5 million (20 per cent) on the prior corresponding period, while platform revenue grew $18 million to $117.8 million.

Netwealth also announced an EBITDA of $58.8 million, up 27.2 per cent on 1H2023 ($46.2 million), and an EBITDA margin of 47.6 per cent.

Statutory net profit after tax (NPAT) for the half year was $39.3 million, an increase of $8.7 million or 28.3 per cent on 1H2023.

The board declared a fully franked interim dividend of 14.0 cents per share, totalling $34.2 million for 1H2024. The ex-dividend date is 4 March 2024 and payable on 28 March 2024.

Netwealth said that, looking ahead, it is focused on “enhancing and extending our current product and technology capabilities to address the substantial number of existing and emerging opportunities in the market”.

“AI is, and will, drive efficiencies, enhance services, improve reporting, and support advisers and clients in new ways,” it said.

“Netwealth and iCapital will be launching exclusive access to offshore private markets and managers to meet the needs of our high net worth, family office, and sophisticated investors.”