The Netwealth Group Ltd (ASX: NWL) share price is pushing higher on Thursday.
In morning trade, the investment platform provider's shares are up 2% to $22.37.
This leaves its shares just a fraction short of a new record high.
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Why is the Netwealth share price rising?
Investors have been bidding the company's shares higher today in response to the release of its fourth quarter update.
According to the release, Netwealth's funds under administration (FUA) increased $3.3 billion or 3.9% during the three months ended 30 June. This $3.3 billion increase comprises FUA net inflows of $3.8 billion (up 38.7% on third quarter inflows) and negative market movement of $0.5 billion.
This took Netwealth's total FUA to a record of $88 billion, which represents a 25% or $17.7 billion increase year on year. This comprises FY 2024 FUA net inflows of $11.2 billion and positive market movement of $6.5 billion.
Also growing during the quarter was the funds under management (FUM). At the end of June, Netwealth's FUM was up $0.8 billion quarter on quarter to $20.5 billion. This represents FUM net inflows of $0.9 billion.
Netwealth's Managed Account balance was $17.6 billion at the end of June. This is up $4 billion or 29.4% year on year. Managed Account net inflows were $0.8 billion for the June quarter, increasing by $0.4 billion or 129.2% on the prior corresponding period.
What else did it report?
One thing that could be holding back the Netwealth share price today is its commentary on fees and margins. It said:
Positive market movements of FUA contribute to higher admin fee revenue, however, the impact is significantly diluted due to the structure of tiered administration fees and fee caps. In addition, many ancillaries are unimpacted by market movement. These factors when combined with the lower cash percentage, have resulted in a reduction in average revenue bps for the year, particularly in 2HFY2024.
No earnings updates or guidance was provided with this release. As a result, investors will have to wait for the company to announce its full year results next month to see what impact the above has had on its profitability for the year.
As a reminder, during the first half of FY 2024, Netwealth reported a 20% increase in total income to $123.3 million and a 28.3% lift in net profit after tax to $39.3 million.
The Netwealth share price is 62% over the last 12 months.
