UK-listed  today shrugged off controversy about the alleged charging practices of some of its advisors by reporting a sharp rise in net inflows of funds under management for the first six months of 2017. Flows rose to £4.3 billion ($5.65 billion) from £3.1 billion in H1, 2016.

The latest figures, issued today, showed total funds under management stood at £83 billion at the end of June, from £65.6 billion. There were a total of 3,540 advisors at the end of June, up 3.7 per cent since the beginning of 2017, the firm said. The figures have been so positive that St James’s Place said its board has declared a 25 per cent increase in the interim dividend to 15.41 pence per share.

A raft of analysts applauded the figures, with several ranking SJP as a “buy” stock. “This is SJP’s 25th year and we believe that it intends to deliver record figures across the board. We have included SJP in our Q3 Conviction List (it was the second best performer in our Q2 List) as we believe that the shares will continue to outperform other insurers in our sector,” Panmure Gordon, the brokerage, said. 

Bank of America, which has a “buy” stance, said: “SJP is our preferred UK asset gatherer and delivered another strong update with its interim results. SJP delivered another exceedingly strong set of flows in Q2. Boosted by new business profits up 50 per cent YoY (around 15 per cent ahead of expectations) at £343m, with increased margins enhancing higher volumes.” Numis, the broker (a “buy” rating on SJP), said it held the firm in “very high regard” and said it should remain a core long-term sector holding for many investors. Royal Bank of Canada, which has a “sector perform” rating on the business, said it would “doubt whether another life company will exceed SJP’s 25 per cent dividend growth this results season”.

Shares in SJP were up more than 7 per cent in early-afternoon trade today.

The results come during a period when the firm has been the subject of controversy about the alleged behaviour of some of its advisors. As reported here, an undercover investigation by Which? magazine found that some advisors failed to comply with transparency rules on disclosure of charges, and as a result misled customers about the nature of their services. The firm has hit back at the claims.

Profits
New business profit, when calculated on a European Embedded Value basis, a way of valuing life insurance, shows new business profits of £343 million, up from £228.9 million. On an IFRS basis of calculating profit, underlying profit before shareholder taxes was £106.3 million, a gain from £73.8 million.

“As our client base grows, so too does the scale of our partner businesses as they develop from largely single adviser practices, into small and medium size businesses, adding value to the clients they attract and serving them well. We see this as very positive development, which bodes well for the sustainability and succession of our partner businesses, and continued growth,” David Bellamy, chief executive, said in a statement.