Edinburgh-headquartered wrap platform provider Nucleus Financial has reported an increase in profits and revenue for 2018, its first period of training on AIM, despite market volatility.
Nucleus, which provides its services to financial advisers, saw its adjusted pre-tax profit rise to £7.7 million for the year ended 31 December 2018, up almost 3% on the previous year. Its net revenue was up 9.6% to £43.2 million and its assets under administration grew from £13.6 billion to £13.9 billion.
It has reported growth in the face of volatile markets and a slowing of asset inflows. It has recommended a final dividend of 3.6 pence per share.
Nucleus reported a 6% increase in its number of active advisers from 1,317 to 1,396 over the last year and a 7% increase in customer numbers from 87,556 to 93,715,
David Ferguson, founder and CEO of Nucleus, said: "We were pleased to end last year having successfully completed two substantial strategic projects.
“Our July admission to AIM allowed us to mature our capital structure in accordance with our ambitions.”
He added that despite the sector headwinds in the latter half of the year, Nucleus views the market outlook as positive for better quality advisers.
But he said the continued lack of clarity caused by Brexit and the ongoing impact on investor confidence is doing little to promote stability and these themes may continue throughout 2019.
John Moore, senior investment manager at Brewin Dolphin Scotland, said: “It’s a relatively positive set of results from Nucleus Financial, given the volatile market environment in 2018.
“In its previous statement, the company said that advisers were feeling cautious and, although market values have recovered since then, it remains an uncertain backdrop – it seems likely that adviser sentiment will have deteriorated further. Yet, Nucleus has still delivered an increase in active users, a rise in revenues and a boost to profits.
“Key to the business’s future will be continuing to grow users, or acquiring other platforms and fintechs to drive economies of scale. In the short term at least, I suspect Nucleus will focus on the latter.”
