Transact inflows up 34% to a record £7.7bn

Adviser platform Transact has reported a record £7.7bn of gross inflows for the year ending 30 September. It represents a 34% rise in gross inflows year on year. Annual net inflows were £4.95bn - a rise of 38% year on year. Funds under direction rose 27% to £52.11bn. In its annual results out today, Transact said it continues to struggle with recruitment as it looks to expand its service teams to maintain service standards in the face of increased flows. Alexander Scott, CEO of parent company IntegraFin, said: “Recruitment of experienced staff has proven more difficult in recent months, as Covid-19 has led many people to consider their priorities for the future and, globally, many are opting to make permanent changes to their lifestyles. “We have, and will continue to, engage with our colleagues, asking for their views on the shape of future office working.” Average staff numbers for the firm increased from 494 to 543, up 10% year on year. This includes the 42 staff who joined as part of the acquisition of Time for Advice. IntegraFin reported profit after tax of £51.1m, a 12% rise year on year. Before tax and non-underlying expenses, profit increased by 20% to £66.5m. Client numbers for Transact increased by 9% over the year. The platform also increased the number of advisers using the platform by 5%. At the end of the year the platform’s clients exceeded 208,000, with over 6,500 advisers actively using Transact. Revenue over the year increased 15% to £123.7m. This was predominantly generated by Transact, although the purchase of Time for Advice (T4A) has made a contribution. IntegraFin acquired the specialist software provider for Financial Planners and wealth managers based in Norwich, in January. Among other projects, T4A teamed up with Microsoft to create CURO, a Financial Planning and wealth management system with over 4,000 users. T4A is currently loss-making due to the costs of system development and an expansion in the number of sales and support staff. Staff returned to the platform’s City of London-based HQ from August with the firm piloting a hybrid working model with a minimum of three days each week in the office for full-time staff. In today’s results the platform’s CEO said that the firm’s confidence in its people returning to full-time office working remains low, with concerns around travelling on crowded public transport. The platform will retain its voluntary office attendance policy for “as long as the treat of another UK lockdown remains a serious possibility.” The IntegraFin directors announced an interim dividend of 7.0p per ordinary share, taking the total dividend for the year to 10.0p per share (2020: 8.3 pence per ordinary share). Transact recently stepped up its efforts to act as an introducer for advice firm acquisitions. The platform has launched a series of virtual workshops for buyers of advice firms. The platform is also looking to create a “shop window” for buyers to anonymously confirm their interest in sellers. In its recent succession planning update, the platform also said that it has seen a trend towards advice firms looking at preserving their legacy through management buy-outs and Employee Ownership Trusts. However, not all has been completely smooth for IntegraFin this year. It faced significant shareholder opposition at its AGM to three board reappointments, including chairman Richard Cranfield and founder Michael Howard. It is believed to be the first time that Integrafin faced major disagreement on board appointments from shareholders. At the AGM in March, 18.43% of shareholder also voted against approving the Directors’ Remuneration Report for the year ending 30 September 2020. However, all motions were passed. Integrafin floated successfully on the London Stock Exchange in 2019. Just over a year ago Mr Howard sold £40m of his shares to set up a charitable foundation.

Transact inflows up 34% to a record £7.7bn

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