Hargreaves Lansdown founders toast windfalls as pensions become ‘cool’Comments Off on Hargreaves Lansdown founders toast windfalls as pensions become ‘cool’
Shares in Hargreaves Lansdown jumped 5% today as the country’s biggest private investor firm said it expects a “return to healthy profit growth” in the coming year.
That was particularly good news for the founders Peter Hargreaves, who stepped down from the board in April, and Stephen Lansdown, who left in 2012, who thanks to a 3% rise in dividends collect cheques for £50 million and £25 million.
Despite profits falling 5% to £199 million in the year to June, chief executive Ian Gorham said: “We had a very good year.
“We took a couple of one-off hits from lowering our charges just over a year ago and lower interest margins on clients’ cash, together worth £37 million of revenues.
“It was also a much quieter time in the markets with the FTSE All Share down 0.8% and none of the excitement of the Royal Mail flotation.
“But we grew assets under management by 18% to £55 billion and added another 84,000 clients, taking the total to 736,000.”
Gorham said he was not going to predict what markets might do in the current year but said with economic conditions improving there was value in several key stock markets in Europe and Japan.
The firm has also benefited from the Chancellor’s pension reforms with more people wanting to look after their own savings pots.
He said: “At last pensions are cool and that’s good news.” He is also optimistic the Chancellor will stick to his promise to sell off the taxpayers’ remaining Lloyds Banking Group shares through a public retail offer later this year.
Hargreaves’ shares rose 52p to 1167p, valuing Hargreaves’ stake at £1.8 billion and Lansdown’s at £881 million.
The amount it was made to pay into the Financial Services Compensation Scheme jumped from £800,000 to £4.4 million for “the failings of less reputable companies.”