Post-Brexit dealing boom boosts Hargreaves Lansdown's half-year profits

Increased dealing activity following the referendum on Britain's European Union membership saw investments and pensions group Hargreaves Lansdown hike its dividend after reporting higher first half profits.

In the six months to 31 December, the London-listed company posted a 21% year-on-year increase in profit before tax to £131m, as net revenues jumped 16% from the year before to £184.8m, leading to the firm hiking the dividend by 10%.

In the six-month period, the number of client-driven equity deals completed jumped 51% year-on-year to 1.95 million, driving the group's market share up from 23.8% to 28%.

However, when not accounting for the Jupiter and JP Morgan client acquisitions net new business inflows declined 7% from the corresponding period last year, with a 22% drop in the first three months of the year partly offset by a 10% increase in the following quarter.

Hargreaves, Britain's largest pension provider, added client and asset retention remained resilient, declining slightly from 94.7% to 93.5%, despite a higher amount of cash withdrawals post Brexit.

Meanwhile. at the end of 2016, the number of clients stood at 876,000, 40,000 higher over the six month-period, with total assets under administration rising 13%year-on-year to £70bn.

Group chief executive Ian Gorham admitted the ongoing political uncertainty made predicting the future but he remained confident over the company's prospects.

"The diversified nature of the Hargreaves Lansdown business has enabled us to deliver significant growth in both revenue and profit," he added.

"Despite macroeconomic uncertainties impacting investor confidence and net new business, clients continue to trust us with their money and benefit from our market-leading investment services. Elevated levels of trading continue with no sign of material reduction six months on from the Brexit vote"

In the lead-up to the 23 June referendum, Peter Hargreaves, who set up the FTSE 100 stockbroker with Stephen Lansdown in the 1980s, said leaving the EU would present Britain with the opportunity to become more financially dynamic. "I'm firmly convinced that day – hopefully – we decide to leave, that little bit of insecurity, that little bit of unknown will be an absolute fillip to everyone," Hargreaves told the BBC. "It will be a great incentive for us to go out and prove that it's right."