* Chairman Mike Evans to step down
* Company to stop publishing separate unit results
* New business inflows of 3.3 bln pounds
* Total clients up 56,000 to 932,000
(Recasts, adds detail from statement, share reaction)
By Simon Jessop
LONDON, May 18 A scaling back of financial
disclosures and another executive departure overshadowed a rise
in funds under administration at British fund supermarket
Hargreaves Lansdown, hitting its shares.
Hargreaves, which helps retail customers invest in a range
of products through its online platform, said on Thursday it
would now disclose its performance as one business unit in
full-year results, rather than detailing each unit separately.
"The board considers that the disclosure ... whereby the
whole business is reported as one unit, better reflects how the
group is managed in practice and we intend to report on this
basis in the full-year results and thereafter," Hargreaves said.
It also said Chairman Mike Evans planned to step down as
soon as a replacement had been identified. The move follows the
replacement this year of the company's chief executive officer
as well as its chief financial officer.
Both updates took the gloss off a 10 percent rise in assets
in the four months to the end of April on the back of market
gains and net inflows, helped by new fund and product launches.
Hargreaves shares fell as much as 5.3 percent and were down
2.2 percent at 1,318 pence at 0907 GMT, underperforming a 1.2
percent fall in the FTSE 100 index.
"We would prefer to see fuller disclosures, given the
relative importance of Vantage to the business," Liberum analyst
Justin Bates said in a note, referring to the company's online
The decision came just two days soon after the firm's shares
took their worst one-day hit in nearly a year when U.S. asset
manager Vanguard announced plans to launch a rival online
platform aimed at retail investors, raising concerns it could
challenge Hargreaves' dominant market position.
The chairman's planned departure was also noteworthy, said
Liberum's Bates, who has a "sell" rating and 1,107 pence price
target on the stock.
"We note this will be the third change in senior management
in relatively quick succession."
The extent of the share price fall was marked given the
company also reported funds under administration of 77 billion
pounds ($100 billion), which was above expectations.
Net new business inflows during the period came to 3.3
billion pounds, while market gains added another 3.8 billion
pounds. Total inflows over the 10 months to the end of April
were 5.6 billion pounds, the company said.
Hargreaves said the performance was driven by a recovery in
investor confidence ahead of the end of the British tax year,
new fund launches, including one from fund manager Neil
Woodford, and government changes to tax-free savings rules.
Flows were also helped by the company's digital marketing
efforts, including the launch of new smart phone apps, and a
continued trend for clients to consolidate their wealth on its
The company said it added 56,000 new clients over the
four-month period, taking total active clients to 932,000.
($1 = 0.7720 pounds)
(Additional reporting by Tenzin Pema; editing by Edmund Blair
and David Clarke)