Netwealth share price up 6% as annual net inflows reach new record

The Netwealth Group Ltd (ASX: NWL) share price is up 5.7% to $13.17 in early afternoon trading.

The share price jump follows the release of the financial services company's June quarterly business update to the ASX this morning.

Netwealth share price spikes on record net inflows

Netwealth reported its highest ever annual net inflows of $13 billion for FY22. That's an increase of $3.2 million or 32.4% on FY21.

Other metrics reported include:

• $55.7 billion in funds under administration (FUA) as of 30 June, up 18% on FY21
• FUA net inflows of $2.7 billion for the June quarter
• FUA decrease of 3.4% in the June quarter due to "negative market movement"
• $13.1 billion in funds under management (FUM) as of 30 June
• FUM net inflows of $400 million for the June quarter
• Managed account balance of $11.2 billion as of 30 June, up 13.6% on FY21

What happened in the June quarter?

Netwealth said the net inflows in the June quarter were strong but impacted by "difficult industry conditions including market volatility and adviser regulatory requirements".

The company also reported that it had received a number of awards during the quarter.

For the fifth consecutive year, Netwealth won the Chant West 'best advised product of the year' for its Netwealth Super Accelerator product.

In the Advisor Ratings 2022 Australian Financial Advice Landscape Report, Netwealth took out the categories of 'best client experience', 'best overall functionality', and 'best for ease of onboarding'.

Over the quarter, the Netwealth share price dropped by 18%.

What's next for Netwealth?

Netwealth owns 25% of a business called Xeppo, which offers a "world-first financial advisory and accounting tool".

Netwealth has agreed to spend $2.5 million to accelerate the ongoing development of Xeppo's data analytics and business management platform. The platform supports Netwealth's 'whole of wealth' strategy.

Netwealth has an option to buy 100% of Xeppo over the next four years.

Founded in 1999, Netwealth is the fastest-growing platform provider by net funds flows in Australia.

The company's statement said its net inflows accounted for "48% of industry net funds flows" in the 12 months to 31 March.

During this time, Netwealth says it had the largest FUA net inflows in the industry.

Netwealth also said it has increased its market share by 1.2% to 5.8% as of 31 March.