Rathbones has reported profits before tax jumping by 72.9%, amid the integration of Investec Wealth & Investment (IW&I) and Saunderson House acquired businesses, in its results today (26 February) for the 12 months ended 31 December 2024.
FUMA reached £109.2bn at 31 December 2024 (31 December 2023: £105.3bn), including £43.0bn from IW&I.
The underlying operating margin increased to 25.4% (2023: 22.3%) "as we continue to realise the benefits of our increased scale".
Underlying profit before tax increased 79.1% to £227.6million (2023: £127.1 million).
Profit before tax increased by 72.9% to £99.6 million (31 December2023: £57.6 million), largely reflecting acquisition and integration costs related to the combination with IW&I, along with higher amortisation charges following the transaction.
Paul Stockton (pictured), group chief executive, said: "2024 has been a very exciting year for the Group as we began in earnest to bring Rathbones and IW&I together as one combined business committed to helping our clients achieve their longer-term financial goals. In an eventful year, we attracted record gross inflows by leveraging our enlarged platform, grew underlying operating margin, exceeded the 2024 synergy targets we set out for the IW&I combination, and increased our dividend by 6.9%.
"Throughout the year, we have continued to improve our services and investment processes, taking advantage of the best that the Rathbones and IW&I teams have to offer. The combination creates some significant future growth opportunities and provides a pathway to greater innovation as ideas are shared and acted upon. I am grateful for the efforts of all teams around the Group who have helped us start 2025 in such a strong position.
"Rathbones remains well-equipped to navigate the challenges associated with industry change and the potential impacts of geopolitical instability on investment markets. Alongside initiatives to enhance our services to clients and improve organic growth rates, our priorities for 2025 include completing the migration of IW&I clients and fully integrating our businesses onto one platform."
The statement further said that 2024 is the first full financial year following the combination with IW&I, with the increase in operating income, profit and earnings per share reported this year reflecting the benefits of the combination and the extent to which its delivery of the related synergies "exceeded the targets we set for 2024".
The comparative figures for 2023 include three months of IW&I's contribution from 1 October 2023, reflecting the timing of the completion of the combination.
"We have delivered cost and revenue synergies well ahead of our first year £15 million target, with run-rate synergy realisation of £30.1 million at the end of 2024. This was largely due to organisational changes and our property consolidation programme being secured ahead of the planned timeframe,", the statement said.
It expect to migrate almost all c. 55,000 IW&I clients by the end of H1. To date, 0.3% have declined to migrate to Rathbones, and "we expect a small proportion of relationships to leave the Group where a suitable proposition is not available". We remain focused on maintaining high client service levels and look forward to welcoming clients to the Rathbones platform in the coming months.
During the year, it further highlighted the integration of Saunderson House, "creating a business model that now includes a well-established financial planning capability to complement our investment strengths".
