Wealth Manager Charles Stanley has increased the revenues it makes from financial planning by 26% over the last year as it eyes further expansion into this area.
Inits annual financial results Charles Stanley said financial planning had raised £6.3 million for the business, an increase from £5 million last year, which it attributed directly to a new pricing model and ‘value proposition’.
Revenues per financial planner increased from £268,000 to £369,000. It has 21 financial planners currently, (18 in 2017).
Charles Stanley said the results gave it ‘confidence in the validity of the model' and that it will continue to ‘scale up through the recruitment of more financial planners’.
It said it wants to grow the financial planning division to represent 10% of the group’s revenues. 'At this level, it will be of sufficient scale to contribute to the group's goal of being a holistic wealth manager,’ it said, adding however that the additional investment required to recruit new financial planners is likely to lead to an increase in the division's losses in the near term.
Charles Stanley said it typically takes 18 to 24 months for a new financial planner to get their revenues up to its target levels.
It said this target was historically £300,000, on average, but has now been increased, to £350,000.
It said: 'In the longer term we believe this investment will lead to greater asset inflows, greater share of wallet, enhanced customer retention and better defensibility of revenue margins because the service meets a fundamental client demand.’
Overall the financial planning division made an operating loss of £2.7 million.
Overall the group reported a pre-tax profit of £11.4 million (2017: £8.8 million). Group revenues increased to £151 million (up from £142 million).
Funds in its discretionary management business increased by 8% to £12 billion (2017: £11.4 billion). Total group funds under management and administration reached £23.8 billion.