Press release and Half Year Report and Accounts 2024

St. James's Place performing well and positioning for further long-term success.

Operating highlights

• Gross inflows of £8.5 billion (2023: £8.0 billion)
• Continued strong retention of client funds at 94.6%¹ (2023: 95.6%¹)
• Net inflows of £1.9 billion (2023: £3.4 billion), representing an annualised 2.3% of opening funds under management (2023: 4.6%)
• Record funds under management of £181.9 billion (31 December 2023: £168.2 billion)
• Net 3% increase in client base to 988,000 (31 December 2023: 958,000)

Financial highlights and shareholder returns

• Underlying post-tax cash result £205.2 million (2023: £207.1 million)²
• IFRS profit after tax £165.1 million (2023: £161.7 million)
• Interim dividend of 6.00 pence per share (2023: 15.83 pence)
• Interim share buyback of £32.9 million, equivalent to 6.00 pence per share

H1 business review findings and outcomes

• Market opportunity remains compelling given structural growth drivers and rising demand for advice
• Reinforced conviction that SJP remains a strong business, with key and sustainable competitive advantages
• Future strategic focus to be built around four pillars:
  • Brilliant basics: We will simplify and standardise our operations, sharpening focus on delivering excellent client outcomes
  • Differentiated client proposition: We will enhance our client proposition, providing a quality offering across differing client segments
  • Leading adviser offering: We will continue to be the best place to be a financial adviser in the UK, setting the standard for the future of financial advice
  • Performance-focused organisation: We will foster empowerment and accountability, evolving our culture and driving performance across our community
• Near-term focus on strengthening business and executing existing programmes of work, laying the foundations for sustained growth
• Plan to increase strategic investment over time, funded through optimising our existing c. £670m addressable cost base³

Saving to invest

• Ambition between now and the end of 2026 to deliver an addressable cost base reduction programme, which will reach full run-rate savings of £100 million (pre-tax) or 15% p.a. by 2027
• Total costs to achieve savings of £80 million largely incurred in 2025 and 2026
• Anticipate cumulative net savings of approaching £500 million through to 2030, after costs to achieve

Investing to grow

• Approximately half of these savings, once realised, will be invested back into the business between 2025 and 2030, supporting strategic initiatives and underpinning long-term growth ambitions

Overall benefit to the cost base

• Combination of cost savings, costs to achieve, and investing for growth, expected to be broadly neutral to the cost base in 2024, 2025 and 2026 with benefits emerging thereafter
• Benefits anticipated, before tax, of £30 million in 2027, £50 million in 2028, and £70 million from 2029 onwards
• Further underpins our ambition to double the Underlying cash result from 2023 to 2030

¹ Throughout this press release our retention rate is calculated as the proportion of FUM retained over the period after allowing for the effect of full and partial withdrawals, but excluding the effect of intrinsic regular income and maturity payments.   

² The Underlying cash result is an alternative performance measure (APM). The glossary of alternative performance measures on pages 96 - 99 defines this APM and explains why it is useful. The Underlying cash result is reconciled to International Financial Reporting Standards (IFRS) on pages 19 and 20.

³ The addressable cost base for the purposes of our business review is total IFRS expenses, less those which were either out of scope for the review, one-off in nature or outside of management’s control.

Mark FitzPatrick, Chief Executive Officer, commented:

“I am encouraged to report robust business performance for the first half of 2024 across each of our key operating and financial metrics, demonstrating the continued resilience of our business model even as we work to address the past challenges that I set out earlier in the year. We have seen high levels of activity and engagement between our advisers and our clients, contributing to positive flows. Helped by strong investment returns for our clients, we have achieved record funds under management, delivered a good outturn for the Cash result, and grown the Partnership and our client base. It’s evident that we remain in good shape.

The first half has seen us make progress against our significant programmes of work to simplify our charging structure and review historic client servicing records. We are on track to deliver our new charging structure in the second half of 2025, in line with previous guidance. The focus of our review of historic client servicing records has been on building and readying the infrastructure that is necessary to analyse significant amounts of servicing records efficiently and accurately. We remain comfortable that the provision we have set up to cover the costs of this exercise is appropriate.

Beyond our operating and financial performance, we have performed a thorough review of the business and the markets in which we operate. Ultimately, this work has reinforced our conviction that SJP continues to be a very strong business, with a fantastic opportunity ahead.

We must though acknowledge that for all our qualities as a business, we have a lot of hard work ahead of us over the next 24 months to strengthen our core and execute our existing programmes of work, helping us to become a more efficient and effective business. From a strong base, we can capture the structural market opportunities ahead of us and drive growth over the long-term.

As we look to the future, we are ambitious and have a clear direction of travel towards achieving sustained success. I am confident that the approach set out following our business review will enable us to achieve annual FUM growth in the mid-to-high single digits over time. While near-term profit growth will reflect the structural impact of transitioning to our new simpler and more comparable charging structure as announced last October, we expect to see the Underlying cash result accelerate in 2027 and beyond, doubling between 2023 and 2030. Importantly, much of this rapid growth is highly predictable because of those changes that we are making to our charges.

We are positioning for further success, and I am confident that our refreshed strategic focus leaves us well placed for a very bright future ahead.”

View the full press release here.

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