Aj Bell Plc · LSE:AJB
Aj Bell — FY2022 Earnings Presentation
29 slides from Aj Bell's earnings presentation, Dec 1, 2022
Slide 1: Annual results for the year ended 30 September 2022
Annual results For the year ended 30 September 2022 Issued on 1 December 2022
Slide 2: Agenda
Agenda Title Page Business update 3 Financial update 15 Outlook 20 Appendices 24 Glossary 27 AJ Bell | Annual results for the year ended 30 September 2022 2
Slide 3: Business update
DAJBell Business update
Slide 4: FY22 key messages
FY22 key messages Our dual-channel platform delivered Our strategy of serving the advised and net inflows of £5.8 billion and AJ Bell D2C segments via full-service and Investments grew strongly, with AUM simplified propositions maximises our increasing 27% to £2.8 billion growth opportunity Our scal
Slide 5: Key investment highlights
Key investment highlights An update on the seven pillars of the AJ Bell investment case Key investment highlight FY22 update » Strong structural growth drivers – £3 trillion total addressable market presents a significant growth opportunity Our market » Inflation a near term headwind but we are well
Slide 6: Our market: a challenging backdrop in the short term
Our market A challenging backdrop in the short term Cost of living squeeze has been driven by rising inflation Lower income households most impacted Figure 1 Figure 3 CPI inflation (1) Forecast Forecast UK household saving rate by income decile (3) 12% Change vs. 2012-18 average 20% 10% 8% 10% 6% 20
Slide 7: Our market: significant long-term growth opportunity remains
Our market Significant long-term growth opportunity remains A fast growing UK platform market (1) Our dual-channel model maximises our growth opportunity Figure 5 Figure 7 14% CAGR AJ Bell platform net inflows 986 763 800 £7.0bn 693 716 320 15% CAGR 570 233 246 £5.8bn 473 205 224 434 £4.9bn £3.2bn 3
Slide 8: Our platform propositions
Our platform propositions An award-winning platform operating in both advised and D2C market segments, with in-house investment solutions Figure 9 Advised D2C Full-service Established platform propositions offering a wide range of investment choice and functionality Simplified Digital-only platform
Slide 9: Our platform propositions: Advised and D2C
Our platform propositions Advised D2C » Pricing reductions made and interest rates on cash increased, » Rebranded from AJ Bell Youinvest in October 2022, creating a delivering further value to advisers’ clients streamlined customer journey » Several enhancements delivered, including making the SIPP
Slide 10: Our platform propositions – AJ Bell Investments
Our platform propositions – AJ Bell Investments Our investment solutions are an increasingly important part of AJ Bell’s platform offering AUM up 27% in FY22 to £2.8 billion, a 10x increase since IPO Transparent, low-cost, simple investment solutions Delivering excellent performance Figure 11 » Cont
Slide 11: Our brand
Our brand In FY23 we will be investing more to increase our AJ Bell brand awareness D2C rebrand New brand initiatives » A new integrated, multi-channel brand and customer acquisition campaign (launching in January 2023) » A major new headline sponsorship deal is expected to be » Most important featu
Slide 12: Our customers: a growing base of loyal, high quality customers
Our customers A growing base of loyal, high quality customers Advised D2C Customers Customers Average customer profile +15% in FY22 to 145,371 Average customer profile +16% in FY22 to 280,281 56 years old (FY21: 57) 43 years old (FY21: 44) AUA AUA £308k of AUA (FY21: £361k) £69k of AUA (FY21: £81k)
Slide 13: Our customers: D2C customer insights
Our customers D2C customer insights Subdued dealing activity in second half of FY22 AJ Bell funds continue to attract new customers and assets Figure 13 Figure 15 Annualised deals per customer AJ Bell funds penetration 5 year trendline 25 6% 20% 5% 20 15% 4% 15 3% 10% 10 2% 5% 5 1% 0% 0% - Sep-19 Se
Slide 14: Platform AUA – gross inflows from new and existing customers
Our customers Platform AUA – gross inflows from new and existing customers FY22 FY21 Commentary Figure 16 Gross inflows Gross inflows » Gross inflows across the platform of £10.1 billion £6.2bn £6.3bn £1.6bn (FY21: £10.9 billion) £1.8bn 29% 25% £4.4bn £4.7bn Advised 71% 75% » New customers again con
Slide 15: Financial update
DAJBell Financial update
Slide 16: FY22 financial highlights
FY22 financial highlights FY22 FY21 +/- Figure 18 Commentary Revenue » Revenue up 12% due to higher average AUA and £163.8m £145.8m 12% improved revenue margin, despite price reductions during the year Revenue margin 22.6bps 22.2bps 0.4bps » Revenue margin improvement reflects higher average Profit
Slide 17: Revenue analysis
Revenue analysis Revenue by proposition, nature of revenue streams and revenue margins FY21 FY22 Figure 19 (£m) (£m) Commentary 83.2 A well diversified revenue model – mix of fixed fees and recurring +16% 71.7 6.0 5.4 charges provides resilience across different market conditions Advised 50.0 46.4 1
Slide 18: Cost and PBT Analysis
Cost and PBT Analysis FY21 FY22 Figure 20 (£m) (£m) Business as usual drivers Other factors » Increased D2C marketing activity, » Low prior year comparative: including Dodl launch - COVID restrictions impacted advertising Distribution 15.0 » AJ Bell brand investment through and sponsorship opportuni
Slide 19: Capital and dividend
Capital and dividend Our highly cash generative and capital light model supports a progressive dividend Regulatory capital position Dividend payments £ million FY22 FY21 Pence per share FY22 FY21 +/- Interim 2.78 2.46 13% Total shareholder funds 133.4 130.7 Final 4.59 4.50 2% Less: unregulated busin
Slide 20: Outlook
YAJBell Outlook
Slide 21: Financial outlook - guidance
Financial outlook - guidance FY23 previous guidance Updates to FY23 guidance Outlook for FY24 Advised D2C Non- Advised D2C Non- » No significant changes to platform Platform Platform platform Platform Platform platform revenue margins anticipated: Revenue margin Revenue margin Revenue Revenue margin
Slide 22: Financial outlook – platform revenue margin guidance
Financial outlook – platform revenue margin guidance Figure 22 Platform revenue margins and PBT margins ~45.0bps 41.4bps 36.5bps 34.3bps 33.2bps 31.6bps ~21.0bps 18.8bps 19.2bps 19.0bps 18.2bps 17.2bps Advised D2C 32% 36% 38% 38% 36% ~37.6% PBT margin FY18 FY19 FY20 FY21 FY22 FY23 guidance » FY23 re
Slide 23: Outlook
Outlook » Some short-term headwinds but a significant long-term opportunity - Inflation a near term headwind but we are well positioned in a fantastic market set to deliver long-term growth » We are set up to achieve long-term success - A talented and experienced management team in place following c
Slide 24: Appendix
DAJBell Appendix
Slide 25: The seven pillars of AJ Bell's investment case
Appendix I The seven pillars of AJ Bell’s investment case Key investment highlight Description Our market A growing market within the UK retail savings and investment industry An award-winning platform operating in both advised and D2C market segments, with in-house Our proposition investment soluti
Slide 26: Platform Customers, AUA and AUM
Appendix II Platform Customers, AUA and AUM FY22 FY21 Commentary Advised D2C Total Advised D2C Total Customers platform Platform Platform platform Platform Platform Opening customers 126,920 241,045 367,965 108,911 172,183 281,094 » Platform customers up 16% to 425,652 Net new customers 18,451 39,23
Slide 27: Glossary
YAJBell Glossary
Slide 28: Glossary
Glossary AUA Assets Under Administration AUM Assets Under Management BPS Basis Points CAGR Compound Annual Growth Rate CPI Consumer Price Index D2C Direct to Consumer EIP Executive Incentive Plan ExCo Executive Committee FY21/FY22/FY23 Year Ended/Ending 30 September 2021/2022/2023 IPO AJ Bell plc’s
Slide 29: Disclaimer
Disclaimer The information contained in this presentation has not been independently verified and no representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained in it.