Brewin Dolphin Holdings PLC, Group Interim Financial Report for the Half Year Ended 31 March 2022

Strong organic fund inflows of £1.9bn

Recommended offer

• On 31 March 2022, RBC Wealth Management (Jersey) Holdings Ltd¹ announced a recommended cash acquisition of Brewin Dolphin Holdings PLC for 515p per share.
• The acquisition is conditional on shareholder and regulatory approvals and is expected to complete by the end of calendar Q3 2022.

H1 financial highlights

• Gross discretionary inflows of £1.9bn (H1 2021: £1.6bn) show continued organic growth driven by our advice-focused strategy and broad range of propositions and investment solutions.
• Total discretionary net flows of £1.0bn (annualised growth rate of 4.0%).
  • MPS/ Voyager H1 net flows of £0.5bn (annualised growth rate 16.4%).
  • Direct client retention rates increased to 99% in H1 2022 (FY 2021: 97%).

Total funds for the first half were broadly flat at £56.3bn (FY 2021: £56.9bn) due to volatile market performance driven by the conflict in Ukraine and the macroeconomic environment. Total discretionary funds were broadly flat in the first half and up 8.1% year-on-year at £49.4bn (FY 2021: £49.8bn; H1 2021: £45.7bn).

Total income increased by 4.8% year-on-year to £209.5m (H1 2021: £199.9m), driven by higher fund levels year-on-year partly offset by normalised levels of commission, as expected.

• Financial planning income grew 24.6% year-on-year to £23.8m (H1 2021: £19.1m); driven by higher fund levels year-on-year and continued demand for our advice-focused services.
• Direct discretionary commission income was down 15.4% year-on-year at £32.3m (H1 2021: £38.2m), as expected.

Adjusted profit before tax² increased 2.3% to £48.1m (H1 2021: £47.0m).

Strong cash balance of £139.8m (H1 2021: £145.8m) and capital adequacy ratio of 210%.

Following the announcement of the recommended offer for the Company, the Board is not recommending an interim dividend.

Delivering on our strategic priorities

• Parallel running of the custody and settlement systems, full functionality of the new system by the end of the summer this year.
• Built and integrated a central sales function, establishing and supporting client leads across the direct business.
• Voyager funds reached £0.5bn, a year and a half after launch.
• A year into our operational excellence programme; accounts opened c.80% faster.

Outlook

• Whilst markets remain volatile, our strong inflows and resilient advice-focused strategy gives us confidence in our full year outlook.
• No change to our opex guidance of mid-high single digit percent growth.
• Full year capex guidance changed to c.£32m from c.£26m, of which c.£26m is on our custody and settlement system. The cost increase on our custody and settlement system is driven by higher than expected inflationary pressure on technology costs and delivery now set to the end of summer, as we continue to focus on mitigating any implementation risks.

NOTES:
1. An indirect wholly-owned subsidiary of Royal Bank of Canada (“RBC”).
2. See note 20.
3. See note 7.

Robin Beer, Chief Executive Officer, said:

“We continued to see strong inflows across both our direct and indirect discretionary funds throughout the first half, with a record first quarter performance despite the volatility in the markets driven by macroeconomic and geopolitical challenges. The resilience in our organic growth, demonstrates our strategy of being an advice-focused wealth manager, supported by our broad range of propositions and investment solutions, is the right one. The business is preparing for the final stage of dress rehearsals and training on our new custody and settlement system and the switch over of systems will be completed at the end of the summer this year.

We believe that the proposed acquisition by RBC will bring new and exciting opportunities for our clients and people. Whilst the transaction is still to complete, we remain focused on delivering our strategic priorities for the year, which will enable us to become a leading advice-focused digitally enabled wealth manager.”

For further information:

Brewin Dolphin Holdings PLC	Camarco
Carla Bloom, Head of Investor Relations	Ben Woodford / Geoffrey Pelham-Lane
Tel: +44 (0)20 7248 4400	Tel: +44 (0)799 065 3341/+44 (0)773 312 4226
investor.relations@brewin.co.uk

The Interim Results presentation will be held at 9.00am on 11 May 2022 and available to watch via an audio webcast. The audio link can be found on the corporate website (www.brewin.co.uk/group/investor-relations). Investors and analysts are also able to dial in to the call using UK & International: +44 (0) 33 0551 0200 or UK toll-free: 0808 109 0700

Publication of H1 2022 results documents available on the offer website

A copy of this announcement and the documents required to be published pursuant to Rule 26.1 and Rule 26.2 of the City Code on Takeovers and Mergers (the “Code”) will be made available (subject to certain restrictions relating to persons resident in Restricted Jurisdictions (as defined in the Scheme Document)), free of charge, at www.brewin.co.uk/RBCoffer by no later than 12 noon on the Business Day following the date of this announcement.

Neither the contents of the website nor the content of any other website accessible from hyperlinks on such website is incorporated into, or forms part of, this announcement.

LEI: 213800PS7FS5UYOWAC49

NOTES TO EDITORS:

About Brewin Dolphin:

Brewin Dolphin is one of the UK and Ireland’s leading independent providers of discretionary wealth management. We continue to focus on discretionary investment management, and we manage £49.4 billion of funds on a discretionary basis. In line with the premium we place on personal relationships, we have built a network of offices across the UK, Channel Islands and the Republic of Ireland, staffed by qualified investment managers and financial planners. We are committed to the most exacting standards of client service, with long-term thinking and absolute focus on our clients’ needs at the core.