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Netwealth share price higher on solid Q2 update

The Netwealth Group Ltd (ASX: NWL) share price is pushing higher on Thursday after the release of its quarterly update.

In morning trade the financial services platform provider’s shares are up 2.5% to $8.21.

How did Netwealth perform in the second quarter?

During the second quarter Netwealth reported a 12.6% or $3.2 billion quarter on quarter increase in its funds under administration (FUA) to $28.5 billion. This was a $9.5 billion or 50.2% lift in FUA over the 12 months to December 31.

FUA net inflows came in at $2.9 billion during the quarter, an increase of $2 billion or 228.3% compared to the prior corresponding period. Favourable market movements accounted for a further $0.3 billion increase in Netwealth’s FUA.

For the half, FUA net inflows totalled $4.4 billion. This was an increase of $2.4 billion or 124.9% compared to the first half of FY 2019.

Also rising strongly was its funds under management (FUM). At the end of December, Netwealth’s FUM reached $5.7 billion. This was an increase of $1.3 billion or 29.4% over the previous quarter.

Finally, Netwealth’s Managed Account was $4.4 billion at the end of the second quarter. This was an increase of $1.3 billion or 40.6% since the end of the first quarter. The company recorded Managed Account net inflows of $1.2 billion during the quarter.

Market share gains.

Netwealth continues to grow its share of the platform market. According to the release, Netwealth recorded the highest platform inflows during both the September quarter and the 12 months to September 30.

The latter is the sixth consecutive quarter where the company has recorded the highest rolling 12-month inflows.

At the end of September its market share stood at an estimated 2.9%. This makes it the eighth largest platform provider, sandwiched between IOOF Holdings Limited (ASX: IFL) and Mercer. They have 4.4% and 2.8% shares, respectively. Banking giant Westpac Banking Corp (ASX: WBC) continues to lead the way with a market share of 18.4%.

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Motley Fool contributor James Mickleboro owns shares of Westpac Banking. The Motley Fool Australia owns shares of Netwealth. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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