Hub24 is a current holding with Rivkin’s ASX Growth portfolio and today has provided a trading update for the Q4 FY 2023, revealing mixed results. The stock is trading -0.85% lower today compared to a -0.36% fall for the ASX200, likely due to a decrease in platform net inflows compared with the prior calendar period.
Funds under administration (FUA) experienced considerable growth, up 22% year on year to A$80.3 billion, including platform FUA, which surged by 26.2% to A$62.71 billion. In contrast, platform net inflows slipped 14.7%, compared to the prior calendar period, to A$2.1 billion for the quarter. Management pointed to rising interest rates as a headwind, with higher term deposit yields attracting investors. Still, there are plenty of positive signs, as the wealth management platform has managed to significantly boost its financial adviser numbers, indicating a growing trust in its services and offerings. Another promising sign of stability is the performance of Hub24’s wealth accounting platform, Class, which showed signs of stabilization after weaker prints earlier in the fiscal year.
Amid economic uncertainty, Hub24’s overall results remain solid, with pension flows continuing their robust trend, seemingly unaffected by economic fluctuations. The firm’s adviser pipeline also remains strong, expanding by 15.1% to 4,011 during the quarter. Furthermore, Hub24 is gearing up to provide custodial platform administration and tech solutions for EQT and AET trustee services clients, setting the stage for growth in FY24.
Hub24’s mixed results highlight both the challenges and opportunities in the wealth management sector. With positive growth in many areas, the firm appears well-placed to navigate the uncertainties of the current climate. HUB continues to demonstrate the characteristics of a high-quality company, a core factor in its selection for the ASX Growth Portfolio.
