Brewin Dolphin Holdings Plc (LSE:BRW) reported record fund inflows for the year to September and announced a 12% increase in its payout to shareholders.
Total discretionary funds rose by 20.9% to £49.8bn, driven by positive net flows and strong investment performance, the wealth manager said in its earnings release.
Discretionary gross inflows hit a record £4bn in the year to 30 September 2021, up from £2.8bn the previous year.
Total discretionary net flows rose to £1.9bn from £0.9bn, representing an annualised growth rate of 4.6%. Of this, £0.5bn came from direct clients and £1.4bn from indirect clients, of which £1bn flowed into the company's MPS solution and multi-asset Voyager fund range.
Total funds increased by 19.5% to £56.9bn, while total income grew 12.3% to £405.9mln, driven by strong market performance and record discretionary gross inflows.
The financial planning business grew income by 25.7% to £41.6mln, driven by both 1762 from Brewin Dolphin and the wealth core propositions.
Adjusted pre-tax profits were 16.2% higher at £90.9mln, with the margin rising to 22.4% from 21.6% on the back of strong income growth and cost savings of £2.6mln associated with COVID-19 restrictions.
Looking ahead, Brewin Dolphin said it anticipates markets will be more volatile in 2022, with governments reducing fiscal stimulus and consumer demand normalising.
“We believe that we are well placed to capture the strong structural drivers in the sector: with growing demand for financial advice, the pandemic being a catalyst for the acceleration, and a generational wealth transfer which is an ongoing tailwind,” it said.
The company raised its final dividend by 12.1% to 11.1p per share, taking the total payout for the year to 15.7p, up from 14.3p.
Brewin Dolphin said its new custody and settlement system is now live and will run parallel with the existing system until next summer.
It expects operating costs to rise next year by a mid to high single-digit percentage, pushed higher by wage inflation and the costs of the parallel running of its new and old settlement systems.
Capital expenditure for fiscal 2022 is estimated at £26mln, of which £20mln will be spent on the final stage of integrating the new custody and settlement system.
Chief executive Robin Beer said: "We have had an exceptional year achieving record discretionary inflows and are delivering on our growth ambitions.
“Looking ahead to FY 2022, our priority is to complete the final phased rollout of functionality for our new custody and settlement system, which will complete in summer 2022. On completion, with our new technology capabilities coupled with the operational excellence programme, we expect to capture significant synergies and benefits across the business, supporting our vision to deliver double-digit earnings per share growth by 2025."