AJ Bell: Firm kicks off buyback as revenue hits record
AJ Bell kicked off a £30m share buyback this morning as the investment platform reported record financial performance, with revenue shooting up 23 per cent.oc
In its final results for the year ended 30 September 2024, the FTSE 250 firm reported a 29 per cent jump in profit before tax to £113.3m as it benefitted from a surge in activity on its platforms and new users.
AJ Bell increased its dividend by 16 per cent and announced a £30m share buyback programme, thanks to the mountain of cash it had accumulated.
It reported it now held £196m in cash, up from £146m at the start of the year.
“Backed by our strong profitability and highly cash-generative business model, we have accumulated significant surplus capital above our regulatory requirements,” said AJ Bell CEO Michael Summersgill.
AJ Bell Investments performed particularly well, with assets under management growing 45 per cent to £6.8bn.
However, the firm’s customer retention rate took a slight dip, falling from 95.2 per cent to 94.2 per cent.
Budget uncertainty hits AJ Bell outlook
It has been a strong year for the company on the stock exchange. AJ Bell’s share price is up 65 per cent since the start of the year.
However, in October, the firm reported uncertainty around the Budget led investors to flood the platform with money to utilise the current tax relief system.
“Amidst increased press coverage ahead of the upcoming Budget, we have seen a noticeable change in both customer contributions to pensions and tax-free cash withdrawals,” said Summersgill in October.
Now, the CEO stressed to the government that it had an opportunity “to galvanise the retail investment market through a long-term commitment to tax stability, allowing more people to invest for the future with certainty”.
“We will continue to campaign for stability and simplicity for retail investors, helping to make it easy for people to invest and plan for the long-term.”
The firm is set to lose its COO Roger Stott at the end of the year, who will have his responsibilities assumed by CFO Peter Birch and CTO Mo Tagari.