Hub24 Ltd (ASX:HUB) Drops 5% After Business Update

The Hub24 Ltd (ASX: HUB) share price closed more than 5% lower today after the company released a business update. Here’s what you need to know.

About Hub24 Ltd

HUB24 is an Australian financial technology business that creates portfolio management and Superannuation software.

Founded in 2007, you can think of HUB24’s software as a way to better manage investments in shares and other assets. HUB24 has a strong management team with decades of experience within the wealth management industry and in the development of platforms.

What’s Happened?

HUB24 released its December quarter FY20 update to the market this morning.

Highlights include:

  • Quarter Net Inflows of $1.259 billion — up 67% on pcp, excluding the large institutional transition in December 2018
  • Record first half Net Inflows of $2.497 million — up 79% on pcp, again excluding the institutional transition in Dec 2018
  • Funds Under Administration (FUA) of $15.8 billion at 31 December 2019 — up 58% on pcp

This strong result sees the HUB24 platform continue to grow at the fastest rate in the industry, while also being ranked 2nd place for both quarterly and annual net inflows according to the latest available Strategic Insights data.

According to HUB24, its strong FUA growth is being driven by both transition opportunities from new and existing adviser relationships, as well as organic flows from existing advisers.

Further, record net inflows over the first half have been assisted by advisers with larger client account balances and therefore, access to competitive pricing.

During the quarter, 136 new advisers began using the HUB24 platform and 17 new distribution agreements were signed. These new distribution agreements were with a combination of institutionally-owned licensees and high quality self-licensed advisers.

Despite this, the HUB24 share price closed the day 5.29% lower, with shares last trading at $11.28.

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