Hargreaves Lansdown PLC Regulatory Capital and Dividend Policy Update (0894N)
August 04 2017 - 2:01AM
UK Regulatory
TIDMHL.
RNS Number : 0894N
Hargreaves Lansdown PLC
04 August 2017
Hargreaves Lansdown plc
Regulatory Capital and Dividend Policy Update
Notification
Hargreaves Lansdown plc ("Hargreaves Lansdown" or the "Group")
today notifies the market of a change to its regulatory capital
requirements and the consequent impact on its expected 2017
dividend declarations.
Hargreaves Lansdown is regulated by the Financial Conduct
Authority (FCA). On 3 August, the FCA notified the Group that it
intends to reassess its regulatory capital requirements given the
Group's strong recent growth in scale and complexity. The revised
assessment would mean the Group's regulatory capital surplus during
2018 is insufficient to meet our risk appetite levels if we paid a
special dividend for the year ended 30 June 2017 in line with
market expectations. In response, the Board has decided it must
clarify its dividend policy and how it will be applied in the 2017
results.
Clarification of dividend policy and approach to 2017
declarations
Hargreaves Lansdown has a progressive ordinary dividend policy.
The Board considers the dividend on a total basis, with the
intention of maintaining the ordinary dividend payout ratio at
around 65% across the market cycle and looking to return excess
cash to shareholders in the form of a special dividend. Any such
return will be determined according to market conditions and after
taking account of the Group's growth, investment and regulatory
capital requirements at the time.
Reflecting this policy and our notification from the FCA
yesterday, the Board expects to propose a final ordinary dividend
that will generate a total ordinary dividend payout ratio of 65%
for the financial year ended 30 June 2017. The Board has concluded
it needs to retain an additional GBP50m of capital and hence the
Group will not pay a special dividend for the financial year ended
30 June 2017.
Hargreaves Lansdown looks to create long-term value for
shareholders by balancing our desire to deliver profit growth,
capital appreciation and an attractive dividend stream to
shareholders with the need to maintain a market-leading offering
and high service standards for our clients. The Group maintains a
strong net cash position and the Board believes it already had a
robust balance sheet with sufficient capital to fund ongoing
trading and future growth. The action announced today maintains
capital above our regulatory risk appetite levels, in line with our
strategy of offering a safe and secure home for our clients'
lifelong investments.
2017 full year results
Given the Group was due to release final audited results on 15
August, the Board has decided to pre-release key information to
allow investors to assess its strong financial and trading
performance alongside this announcement. For the financial year
ended 30 June 2017, Hargreaves Lansdown expects to announce:
-- Assets Under Administration up 28% to GBP79.2 billion
-- Net New Business of GBP6.9 billion, up 15% in the year
-- 954,000 active clients, an increase of 118,000 in the year
-- Unaudited profit before tax increase of 21% to a range of GBP265 million to GBP266 million
At the results presentation on 15 August, Hargreaves Lansdown
will discuss the results in more detail and update investors on the
progress it is making in capturing the attractive opportunities it
sees for growth in the UK savings and investments market.
About us:
Hargreaves Lansdown is the largest direct to investor investment
service administering GBP79 billion of investments for over 950,000
clients. Our purpose is to empower people to save and invest with
confidence. We aim to provide a lifelong, secure home for people's
savings and investments that offers great value, an incredible
service and makes their financial life easy.
Contacts:
Hargreaves Lansdown
For media enquiries: For analyst enquiries:
Danny Cox, Head of Communications James Found, Head of Investor
Relations
+44(0)117 317 1638 +44(0)117 988 9898
Chris Hill, Chief Executive Officer Philip Johnson, Chief
Financial Officer
Forward-looking statements
This document has been prepared to provide additional
information to shareholders to assess the current position and
future potential of the Hargreaves Lansdown Group ("the Group"). It
should not be relied on by any other party for any other purpose.
This document contains forward-looking statements that involve
risks and uncertainties. The Group's actual results may differ
materially from the results discussed in the forward-looking
statements as a result of various economic factors or the business
risks, some of which are set out in this document.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCLLFEATLIVIID
(END) Dow Jones Newswires
August 04, 2017 02:01 ET (06:01 GMT)
Hargreaves Lansdown (LSE:HL.)
Historical Stock Chart
From Mar 2024 to Apr 2024
Hargreaves Lansdown (LSE:HL.)
Historical Stock Chart
From Apr 2023 to Apr 2024