Quilter (LON:QLT) Issues Earnings Results

Key Points

• Quilter reported strong operating momentum: Core net flows reached a record £6 billion, up 32% year over year, while adjusted profit rose 12% to £112 million and EPS increased 13%.
• The operating margin held at 30% despite inflation, lower interest income and technology investments. Full-year costs are expected to reach £530 million–£540 million, likely near the upper end of the range.
• Shares fell 3.3% to GBX 196 following the results, despite analysts maintaining a broadly positive view with a “Moderate Buy” consensus and an average target price of GBX 205.86.

Quilter (LON:QLT - Get Free Report) issued its earnings results on Thursday. The company reported GBX 3.30 earnings per share for the quarter, Digital Look Earnings reports. Quilter had a return on equity of 8.35% and a net margin of 1.28%.

Here are the key takeaways from Quilter's conference call:

• Record core net flows reached £6 billion, up 32% year over year, while net flows rose to 9% of opening assets. Gross flows increased to £11.9 billion, reflecting continued momentum across the platform, solutions and high-net-worth businesses.
• Adjusted profit rose 12% to £112 million and EPS increased 13%, supported by 12% revenue growth and a 16% increase in net management fees. The company also reported a strong solvency position and has completed nearly 70% of its £100 million share buyback.
• The operating margin held at 30% despite inflation, lower interest income and elevated investment in technology, data, branding and distribution. Full-year costs are expected at £530 million–£540 million, likely toward the upper end, although management retains a long-term ambition to reach margins in the mid-30s.
• Quilter highlighted strong competitive positions, including an 18% share of platform gross new business and a 13% share of the MPS market. Management expects peer-leading net flows above its previous 45% ambition for the foreseeable future and anticipates second-half adjusted profit to be mid-single-digit percentage points above the first half, assuming steady markets.
• Management said advisor churn has not materially increased despite heightened competition, but acknowledged that platform pricing remains competitive and client-asset tiering continues to pressure revenue margins. Quilter is investing in AI and an adviser technology ecosystem to improve productivity and reduce servicing costs, while noting that the newer Quilter Invest proposition is a long-term, early-stage opportunity.

Quilter Stock Down 3.3%

Shares of QLT stock traded down GBX 6.60 during mid-day trading on Thursday, hitting GBX 196. 2,365,545 shares of the stock traded hands, compared to its average volume of 24,288,008. The stock has a market cap of £2.66 billion, a P/E ratio of 22.79, a P/E/G ratio of 2.50 and a beta of 0.82. The stock's fifty day moving average is GBX 195.83 and its two-hundred day moving average is GBX 188.78. Quilter has a 52-week low of GBX 150.80 and a 52-week high of GBX 209. The company has a debt-to-equity ratio of 18.49, a current ratio of 3.92 and a quick ratio of 0.05.

Analyst Ratings Changes

Several analysts recently weighed in on the company. Citigroup lifted their price objective on Quilter from GBX 195 to GBX 210 and gave the company a "neutral" rating in a report on Monday. Jefferies Financial Group reissued a "buy" rating and set a GBX 220 target price on shares of Quilter in a research report on Wednesday, April 15th. Berenberg Bank boosted their price target on shares of Quilter from GBX 190 to GBX 195 and gave the company a "neutral" rating in a report on Friday, April 24th. JPMorgan Chase & Co. lowered their price target on shares of Quilter from GBX 212 to GBX 206 and set an "overweight" rating for the company in a research report on Tuesday, April 21st. Finally, Royal Bank Of Canada increased their price objective on shares of Quilter from GBX 220 to GBX 225 and gave the company an "outperform" rating in a research note on Thursday, May 28th. Five equities research analysts have rated the stock with a Buy rating and two have issued a Hold rating to the company's stock. According to data from MarketBeat, the company has an average rating of "Moderate Buy" and an average target price of GBX 205.86.

Insider Activity

In other news, insider Andrew Ross acquired 27,100 shares of the business's stock in a transaction dated Wednesday, May 20th. The shares were purchased at an average price of GBX 186 per share, with a total value of £50,406. 0.52% of the stock is currently owned by insiders.

About Quilter

Quilter is a leading UK-focused full-service wealth manager, providing advice-led investment solutions and investment platform services to over 500,000 clients. Its purpose is to create brighter financial futures for every generation. Quilter strives to do this through supporting long-term advice-based relationships, delivering good investment management performance while maintaining consistently high-quality customer service. It has leading positions in one of the world's largest wealth markets, and its multi-channel distribution, award-winning platform and investment solutions are delivering attractive growth.

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