Kingswood profits up but revenues fall

Wednesday, 24 May 2023 08:44

Group operating profit rose 36% to £8.7m at Financial Planner and wealth manager Kingswood in 2022, according to a trading update this morning.

In March, Kingswood confirmed that it was up for sale but with no certainty a deal would be done.

It has engaged investment bank Houlihan Lokey as its financial adviser for any deal.

However, the trading update issued this morning made no further comment on the potential sale of the company’s UK business operations.

While group operating profit rose, group revenue fell 2.5% year-on-year to £145.9m due to market volatility.

Kingswood said it had seen a slowdown in capital market activity in the firm’s US investment banking business, according to financial results released today.

The US business had recurring revenue of 15%, in comparison to its UK Financial Planning and wealth management business where 88% of the revenue was recurring in nature.

Group assets under management and advice increased by £3.7bn, year-on-year, to £10.5bn as at 31 December 2022.

The Financial Planner said that assets under management and advice since increased by £1.4bn at the end of March due to the acquisitions of Barry Fleming Partners and Moloney Investments Ltd in the first quarter.

The company's 15 acquisitions completed since the start of 2021 added £3.2bn of assets under management and advice, and £11.8m of additional revenue in 2022.

David Hudd, chairman at Kingswood, said: “The group continues to enjoy strong long term investment support from Pollen Street Capital, KPI Nominees and other minority investors which has fuelled its growth to date. It continues to explore sources of additional investment from both public and private sources to maintain a trajectory of accelerated growth.

“The growth opportunity for Kingswood remains strong and through organic growth and further acquisitions (where Kingswood has a strong pipeline), we are building a trajectory to deliver an operating profit in excess of £20m.”

Kingswood added that it has been addressing its “diversity imbalances”, with 40% of its UK adviser hires in 2022 being female, in comparison to its overall adviser community where around 19% of advisers are female.

Kingswood is an AIM-listed wealth manager. It has acquired numerous UK and US Financial Planning and Wealth Management firms in recent years including Berkshire-based Financial Planner Barry Fleming & Partners for £6.2m in January and JFP Holdings Limited, the parent company of Cheshire Chartered Financial Planner JFP Financial Services Limited, for £12.4m in December.