St. James's Place plc

Good morning and welcome to our 2026 half-year results presentation. I'm pleased to report a strong set of results for St. James's Place, reflecting both good financial performance and continued operational and strategic progress. Thank you for watching. This is reflected in our new business performance. Net inflows for the period were £2.7 billion, supported by gross inflows of £10.5 billion. We also saw an improvement in fund retention to 95.4%. This was above our long-term ambition of 95% and reflects the quality and longevity of relationships we and our advisors build with clients. FUM increased to over 240 billion pounds during the first half, driven by both positive net inflows and strong investment performance. Investment returns represented 16.4% of opening FUM on an annualized basis, net of all charges. This return reflects the value we deliver to clients through our distinctive investment management approach and our proprietary range of funds and portfolios. All of this helps clients to achieve their long-term financial goals. The strong growth in FUM combined with our new business outturn has translated into good financial results for the first half. We've delivered an adjusted IFRS before tax result of £278.4 million and Caroline will walk through the detail behind this shortly. Both our client and advisor communities grew during the period with a net 27,000 new clients up nearly 3% and an increase in advisor numbers to 4,951 at the end of June. Overall, the results show that our business is in good shape. These results also reflect the benefits of the investments we've made across the business. In a competitive marketplace, we continue to focus on strengthening our client and advisor propositions. With that, I'll hand over to Caroline to take you through the financials in more detail.

Thanks Mark and good morning everyone. I'm pleased to present our half-year results in our new simplified reporting framework which we announced to the market on the 18th of June. I will not be providing detailed background on the new framework today but if you'd like a reminder of this all the relevant materials are available on the shareholders section of our website. I'm going to start by focusing on our financial performance for the period taking you through our adjusted IFRS results and the financial impact of our key programmes of work. I'll then set out our liquidity position and close with shareholder returns for the period. As usual, we are presenting the results for the first half of 2026 compared to the first half of 2025. However, the shape of our financials changed following the implementation of our simple comparable charging structure in late summer last year and so there are structural differences between the financial results for these periods. Let's start by taking you through the adjusted IFRS P&L. I'm very pleased that our headline metric adjusted IFRS profit before tax was £278 million for the period. After tax, this equated to £224 million, which compares to consensus expectations of £194 million. As anticipated and guided, these results are lower than they were in the first half of 2025 due to the expected lower initial and ongoing margins earned under our new charging structure. whether this effect extends to the full year 2026 will depend on how markets develop over the second half but from 2027 onwards we anticipate sharply accelerating earnings and we remain confident in our ambition to double adjusted profits from 2023 to 2030. Much of our income and expense base vary together with FUM levels or inflows, and so it is useful to consider these items together. As a result, I'm going to focus my adjusted IFRS commentary on the analysis by business driver table, which you can see on the slide. And as this table clearly shows, our profitability is driven by FUM. Profit from FUM was £528 million for the first half of 2026, an increase of 4% period on period. This was driven by strong fund growth partially offset by the expected impact of earning lower ongoing margins under our new charging structure. Profit from Fund was within our 2026 guidance range of 47 to 49 basis points of total average fund on an annualised basis. We continue to expect this margin will be in that range for full year 2026 and that it will increase annually through to 2031 as gestation fund begins to contribute to ongoing profitability. We will provide one year forward guidance on the profit from fund range, but for modelling purposes, we suggest you assume that the range increases by approximately three basis points annually out to 2031. You can find a summary of all our guidance in the appendix to the slide deck, which is unchanged from when we announced our simplified reporting framework. This annual increase in profit from fund margin, combined with net inflows and investment return increasing fund in supportive markets, builds a powerful picture of how our profitability can develop and compound over the medium term. As expected, at £18 million, profit from inflows is relatively immaterial under our new charging structure, following the removal of initial product charges, and we expect this to remain small going forward. I'll now expand expenses unrelated to fundment or inflows into its constituent parts. The most significant expense in this category is our people, property and technology, or PPT costs, which equated to £261 million in the first half. We continue to expect that full year PPT costs will increase by 5% year on year. Cost growth will be weighted towards the second half of the year due to an increase in our anticipated reinvestment spend in that period, enabled by the cost savings from our cost and efficiency programme. Charge structure and implementation costs were nil in the period, compared to £51 million in the first half of 2025. This is as expected given our new charging structure was implemented in late summer last year. The final key line in the adjusted IFRS result is investment return and net finance income, which was £71 million for the period. This has increased period on period, primarily driven by both shareholder investments in money markets funds and business loans to partners being higher in average in the first half of 2026 compared to the first half of 2025, partially offset by a decrease in interest rates. These factors combine to give adjusted IFRS profit before tax for the period of £278 million. Whilst this is a reduction of 9% compared to the first half of 2025, driven by the impact of our new charging structure, as previously mentioned, we anticipate sharply accelerating earnings growth from 2027 onwards. The effective tax rate for the first half of the year was 19% in the adjusted IFRS result. This is lower than we would expect over the long term due to temporary market-related accounting effects, which means there will be some variability in reported tax rates from period to period. However, the current standard UK corporation tax rate of 25% remains the most appropriate assumption for you to use in your modelling. This led to adjusted IFRS profit after tax of £224 million. I'll now move on to cover the financial impact of our two key programmes of work. Firstly, the historic ongoing service evidence review. We are now in the final stages of this work and we remain confident in completing the programme by the end of 2026. Due to experience gathered during the period, we've been able to release a further £110 million before tax from our ongoing service evidence provision. This release is recognised outside of the adjusted IFRS P&L due to its non-recurring nature. The remaining provision stands at £110 million at the half year. Consistent with previous releases from this provision, the Board has decided to return the post-tax amount of £83 million to shareholders in full through a share buy-back programme. I'll set out further details when I cover shareholder returns shortly. Secondly, our cost and efficiency programme. As a reminder, our aim is to take £100 million of cost a year out of our addressable cost base. The objective of the programme was never simply to reduce costs. It was to create a stronger, more scalable business with greater capacity to invest to drive future growth. We expect to reinvest approximately half of the cost savings over the period to 2030, resulting in a significant reinvestment envelope of around £260 million. That level of reinvestment is an important enabler for the next phase of our strategy. We remain on track to deliver the programme by 2027. As previously guided, this programme has had no material impact on these half year results. This is because the cost savings have been broadly matched by cost to achieve and reinvestment spent. During the period, we prioritised our reinvestment spend on enhancing the propositions we provide for both advisors and clients. One area that's particularly close to my heart is the continued evolution of our business sale and purchase or BSP scheme. This is a critical part of what we offer our advisors. It supports them throughout their entire journey from recruitment to retirement helping them build successful businesses, grow their value over time and ultimately realise that value when they choose to retire or step back. We see BSP as a key enabler of both business growth and capital realisation which is why we continue to invest in its development. By strengthening this proposition, we are giving advisors greater confidence in their future and helping ensure they can fully benefit from the businesses they have worked so hard to build. Mark will talk more about other enhancements to our advisor and client propositions later. We continue to expect that the programme will have no material impact on the full year 2026 results for the same reasons it had no material impact in the half, after which time benefits to the adjusted IFRS result will start to emerge in line with our previous guidance. Let me now turn to our liquidity position. At 30 June we had £276 million of free liquidity held at Group Centre. You can see how this is derived from total shareholder liquid assets on the slide. We are comfortable holding this level of free liquidity as it provides a layer of both prudence and flexibility in how we run the business. We will regularly review this to ensure we continue to optimise our capital allocation priorities in line with our capital allocation framework which is unchanged and included in the appendix. Cash flows into and out of free liquidity over the period are set out on this slide which demonstrates that our business is highly cash generative. Finally, shareholder returns. As we communicated in February, the Board intends to increase our payout ratio for ordinary shareholder returns from 50% to 70% for 2026 and beyond. This ratio applies to adjusted IFRS profit after tax under our new reporting framework. But as this metric is equivalent to the underlying cash result, there is no change in the amount that will be paid out. In February, we also set out our intention for the half year 2026 shareholder returns, which was that these would be set at a third of the prior four year balance for ordinary shareholder returns, excluding buybacks relating to releases from our ongoing service evidence provision. In line with this guidance the board has declared an interim ordinary dividend of six pence per share together with an interim ordinary share buyback of 45 million pounds. Combined with the additional buyback due to the release from the ongoing service evidence provision for the period this means our total buyback program will be 128 million pounds. We will commence this buyback in August. To conclude, we've delivered good financial results for the first half of 2026, driven by strong growth in firm and disciplined expense management, offset, as anticipated, by the impact of our new charging structure. We continue to have a strong balance sheet and we are committing to shareholder returns of £159 million through the combination of share buybacks and the interim dividend. The annual increase in profit from fund margin combined with growing fund and all new business now contributing to ongoing profitability from day one means we anticipate sharply accelerating earnings growth from 2027 onwards, underpinning our confidence in our ambition to double adjusted profits from 2023 to 2030. With that, I'll hand back to Mark.

Thanks Caroline. Now I'm going to cover two topics. First, our strategic progress, including how we see technology as an enabler to our business. Second, why we're excited about the market opportunity ahead and how we're leveraging our scale to extend our competitive advantage. So, beginning with strategy. As you have heard, we've progressed things well in the first half, both financially and operationally. What I'm going to do now is step back and talk about where we are in our strategic journey and why we remain confident in the path ahead. You'll recall that we designated this initial period as our strengthened phase. We are focused on addressing legacy matters, simplify the business and improving the way we operate. St. James's Place is a simpler, more efficient business today. Thank you for watching. The transition has been successful. Advisors continue to attract new clients and generate significant levels of new business. The new structure has supported innovation across our product range, including the launch of Polaris Multi Index. The changes we've made have strengthened our proposition for both advisors and clients. Our ambition is never to be the lowest cost provider. It is to deliver great outcomes through high quality advice. The charging structure changes we've made strengthen our ability to demonstrate that value proposition with confidence. Second, our cost and efficiency program. This is helping to create a simpler, more productive and more scalable organization. Importantly, the benefits extend beyond efficiency alone. By simplifying how we operate, we're creating additional capacity to invest in both advisor and client propositions to drive future growth. The Historic Ongoing Service Evidence Review This has been a significant undertaking across the business. As Caroline outlined earlier, I am pleased we are entering the final stages of this work. As these programs reach completion, management attention and investment will increasingly shift towards growth. These initiatives have left us better positioned to scale, invest and maintain leadership in our marketplace. Alongside these programs, we've continued to make strong progress on several strategic priorities. First, we have broadened our client proposition. We've launched Polaris Multi-Index and continue to evolve our cash proposition through our relationship with Flagstone. This includes expanding access to cash ISAs, reducing minimum deposit amounts and securing improved pricing for clients. These enhancements enable advisors to support a broader range of client needs. We're also continuing to explore opportunities to further develop our proposition for clients with more complex and substantial wealth planning needs. As the UK wealth market evolves, we see an opportunity to enhance the support available to higher net worth clients as part of the Amplify phase of our strategy. We have strengthened the St. James's Place brand. Our net promoter score and brand awareness have both increased by 14 percentage points since the end of 2023. In a business built on trust, relationships and referrals, these are such important indicators of long-term strength. They support client retention, advisor growth and the ability to attract new clients at scale. We are strengthening the sense of community within the partnership, renewing our focus on bringing advisors together to increase connectivity, learning and the sharing of experiences. We have evolved our market-leading BSP proposition, which is our succession support scheme. We've improved pricing transparency, simplified transaction processes, and expanded support for first-time buyers. This has helped to create a more efficient and accessible BSP marketplace, supporting advisors to build and grow with the confidence that they can realize the value of their advised businesses. These developments contributed to a strong first half on the BSP front. Nearly 200 advisors made purchases through the scheme during the period and BSP transaction volumes were significantly ahead of the prior year. We also supported the largest BSP transaction in our history. This demonstrates the strength and maturity of the marketplace we've created and our ability and appetite to support transactions at real scale. Alongside this progress, we've continued to modernize one of the most important enablers of our long-term strategy, namely technology. I'm going to spend a few minutes talking about technology, including the role of AI at St. James's Place, and how this is already delivering benefits across our business today. Technology is increasingly a competitive advantage within our industry. At St. James's Place, it improves advisor productivity, enhances client experiences, and helps us scale more effectively. Good technology is not a choice. It is a strategic priority. Over the last six months, we've completed a review of our technology strategy through to 2030. This ensures we're well positioned to build on our technology foundation in the years ahead. At its heart, the strategy is centered on executing on three priorities. First, making St. James's Place easier to do business with. We are simplifying advisor tools, improving connectivity between systems and enhancing digital experiences for clients. The objective is straightforward, less friction, greater productivity and better experiences. Second, creating a more efficient and scalable business. We're simplifying processes to reduce duplication, improve control, and free up resources to invest for growth. Third, strengthening our data foundations. As the UK's largest financial advice business, we have deep client relationships and a huge amount of data. It will help us deliver increasingly personalized experiences for clients, and it will create an environment that will allow us to make much greater use of AI over time. As technology, data and AI reshape our industry, scale is becoming an increasingly important competitive advantage. Our scale enables us to continue investing in our proposition, technology and capabilities for the benefits of advisors and clients alike. One of the most exciting opportunities the stronger technology and data foundations create is the ability to make much greater use of AI. We think we're well positioned in an increasingly AI-enabled world. At its core, financial advice is built on trust, judgment, and long-term relationships. Those things don't go away as technology evolves. If anything, they become even more important. So how do we think about using AI today? Our approach is guided by three principles. First, human-centric AI. We're using AI to reduce administrative efforts and improve quality. This allows advisors to spend more time with clients, delivering high quality advice and building more successful businesses. Second, ecosystem-led innovation. We work with leading technology partners, combining their expertise with innovation from across St. James's Place and the partnership. Our scale and profile as a market leader means that the largest technology companies in the world want to work with us. Third, treating data as a strategic asset. Reliable data is essential for effective AI and for helping advisors to deliver increasingly personalized client experiences at scale. In our view, the businesses that can combine trusted relationships, good data and the ability to keep investing are likely to be the ones that benefit most from AI. As the UK's largest advice business, we believe St James's Place is particularly well positioned for this environment. So far from being a threat to our model, we see AI as an enabler of it. Today, we already have more than 20 AI-enabled tools delivering benefits across St. James's Place. Advice Assistant is saving around 90 minutes per case while improving quality and accuracy. ChatSJP already supports around 2,500 monthly users within our partner practices, helping them find policy and advice information quickly and efficiently. This is tracking at about 15 minutes saved per query and it allows users to access information and support 24-7 rather than being restricted to core business hours. SOFI, a meeting intelligence tool, is now being rolled out across the partnership following a pilot program. By automating key elements of meeting administration, SOFI saves valuable time for advisors and their teams, enabling more time to be spent with clients and prospects. And firms participating in the pilot achieved higher new client growth relative to control groups, with the benefit more pronounced among our smaller partner practices. This provides a strong early indication that the tool can enhance advisor productivity and contribute to stronger practice growth and profitability across the partnership. The tools already in use across St. James's Place are improving productivity and supporting better experiences for advisors and clients. We'll build further on these AI capabilities over time. So where does this leave us? We are focused on how we use the stronger business we've built to better support clients and advisors and drive growth. This includes embedding recently announced changes to partner pay and benefits. These enhance a number of things. They simplify advisor pay, better align reward with the delivery of high quality holistic advice, and strengthen our already compelling advisor proposition. Importantly, these changes are fully funded through efficiencies and scale benefits already been achieved elsewhere in the business. As we look ahead, we'll also continue laying the foundations for the next phase of our strategy, namely the Amplify phase. I'll share more details on this at our full year results. The second main topic I wanted to cover is why we're excited about the market opportunity ahead and how we're leveraging our scale to extend our competitive advantage. As we think about the future, what gives us real confidence is not only the progress we've made, but also the size of the opportunity ahead. Today, approximately £1 trillion of UK assets are advised and only around 9% of UK adults receive regulated financial advice. This is very low, especially when compared to a reported 27% in the United States. Over time, even if the UK moves moderately closer to those levels, that represents a very significant expansion in the addressable market. This reinforces our conviction that there is substantial untapped demand for high quality, trusted financial advice over the long term. Both the regulator and the UK government see this as an issue to be addressed. We believe the firms that combine trusted advice with the capacity to invest will be the biggest beneficiaries as our industry evolves over time. Competition for advisors is increasing, offering advisors greater choice when considering where to set up and run their advice businesses. At the same time, the advice industry is evolving. Advisors need more technology, more regulatory support, more investment capability, and greater operational scale behind them than ever before. They need this to meet increasing client expectations for personal advice, great service, modern technology and high quality investment solutions. Delivering all of that consistently requires sustained investment. Because our success depends on attracting developing and retaining talented advisors over the long term, we've spent the last two years strengthening every aspect of the St. James's Place proposition. We believe scale is becoming an increasingly important competitive advantage in our industry. As the UK's leading advice business we are particularly well positioned. Let me explain what that means for us. St. James's Place combines the trust and visibility of a national brand with the personal client relationships that sit at the heart of successful financial planning. Advisors increasingly need more than a platform. They need a partner that can help them attract clients, develop professionally, operate efficiently and build long-term value. At St. James's Place, advisors have access to market-leading support, training and professional development throughout their careers. The partnership operates as a collaborative community where advisors learn from each other, share best practice and benefit from their collective expertise. They are supported by modernising technology, operational infrastructure and a differentiated investment proposition, including our market-leading Polaris solutions. This allows them to focus more of their time on clients, building more successful businesses and deliver better long-term client outcomes. And they operate within a model designed to help them build, grow and ultimately realise the value of their quality advice businesses. This is all supported by powerful and proven initiatives such as our market-leading BSP proposition, which I spoke about earlier, and the St. James's Place Academy. The Academy continues to thrive and is key to succession planning, regenerating the partnership, and building diversity. We take great pride in the fact that we train and develop around half of all the new advisors in our profession. This underlines both the scale of our investment in professional development and our long-term commitment to the future of financial advice. It's another point of differentiation for St. James's Place and one of the key reasons why our advisor proposition is the most compelling in UK financial advice. These same strengths create a powerful and differentiated proposition for clients. As St. James's Place, clients benefit from what we describe as the best of both worlds. They receive the personal relationship, trusted guidance, and long-term support of a local advisor. Someone who knows them, understands their circumstances, and helps them navigate life's most important financial decisions. At the same time, they benefit from the scale, expertise and security of the UK's largest advice business. That means access to leading investment solutions such as our flagship Polaris range, which are managed by top fund managers from around the world. It means ongoing investment technology and service, a wide range of planning capabilities and solutions. and the strength and backing of a UK FTSE 100 business with clear market leadership and a long track record of success. As the external landscape evolves, our advisors are supported by an organization that has the resources and capability to understand, react and adapt. This ensures clients continue to receive the best service. Our business is predicated on fully backing our partnership community. We guarantee their advice and provide the technical insights to help them understand and adapt their advice for changes in tax, pension, regulatory and political landscape. We believe this combination is unique in the UK market, and it's what makes our partnership model so powerful. As we continue to grow, we're able to invest more in the things that matter most to advisors and clients. Better technology, better service, better support, better solutions. Indeed, we're currently investing at a level unprecedented in the market. Our scale enables us to do this. And that's one of the reasons we believe our business model is becoming increasingly differentiated. So let me leave you with five closing thoughts. One, our strategy is clear, consistent and delivering results. 2. We have strength in the business. We are entering the next phase with a compelling advisor offering, an enhanced client proposition and increasing operational leverage. 3. We are operating in a large market with attractive long-term growth characteristics. Demand for trusted advice continues to grow. Four, technology is creating new opportunities to improve productivity and client experiences. We believe the value of scale, trust, and professional advice will only increase over time, which plays to our strengths. 5. We have confidence in our direction of travel and in our ability to continue delivering for all our stakeholders. Thank you for listening and please tune in for our live Q&A which will kick off at 9am. Thank you and good morning everyone and thank you for joining us. Before we open for questions, a few brief opening remarks from me. Firstly, I'm very pleased that we've achieved a strong set of results for the first half. Good operating and financial performance, continued strategic progress and further growth in both our client and advisor base. We delivered positive net inflows of £2.7 billion, grew funds under management to a record £240.8 billion and continue to see strong engagement between client and advisors. These outcomes reflect the enduring demand for trusted financial advice and the strength of our advice-led model. We also continue to make good progress on our strategic journey Over the last few years, we have focused on strengthening and simplifying the business through a series of major programs. During the period, we made substantial progress in our historic ongoing service evidence review, and this has enabled a further provision release, which we will be returning in full to shareholders through a buyback. Alongside all of this, we continue to strengthen both our client and advisor proposition, Invest in technology and productivity tools and enhance the pay and benefits and support available to advisors across the partnership. Looking ahead, we remain confident in the long-term outlook for financial advice in the UK. The advice market remains under-penetrated, client needs are becoming ever more complex and the value of trusted advice continues to grow. As we move through the latter stages of the strengthened phase of our strategy, our focus is increasingly turning towards the opportunities ahead and the transition to amplify. We believe St. James's Place remains the most compelling place in the UK to build, grow and realise value from a successful financial advice business. This enables our advisors to deliver the trusted advice, service and support our clients value. This leaves us well positioned for the next phase of growth. With that, let's open up for questions.

Thank you. We will now begin the question and answer session. If you'd like to ask a question, please press star followed by one on your telephone keypad. If you change your mind, please press star followed by two. And when preparing to ask your question, please ensure that your device is unmuted locally. And our first question comes from Andrew Law with Citi.

Hi, thanks for taking the question. I've got two. The first is on your advisor retention rate in the first half. Could you clarify what that was in the first half and how that compares to the 91% retention rate that you saw in 2025? It seems likely to have gone down rather than up, but your advisor numbers are up 0.3% in the first half. and there have been unquantified planned exits from underperforming advisors. Can we conclude that you're doing more lateral hires from other advice firms or has the gap been bridged by a step up in the number of advisors graduating from the SJP Academy where presumably day one productivity may be lower? So any colour there would be great. And then the second question is just on your pass through of your fees to your advisors. There's been a lot of debate on this during the past couple of weeks. and how you are perceived to be retaining more of the advisor fees versus other platforms who seem to be talking about passing through 80 to 85 percent of the gross fees to their advisors. So if I take the 25 basis points of ongoing advice fee that you keep as a percentage of Thank you very much. Thanks.

Okay, Andy, thank you. So hitting a topic I expected that we'd spend a little bit of time on today. I think maybe just some broader comments around the whole element of partner, partner retention and the like, and then I will get to those explicit components. Firstly, I think I would say the reality for almost every wealth manager around the world is the ebb and flow of advisors. We've seen it for decades in St. James's Place, and it's not particularly new. So our partner retention number is running at 90% at the moment. Last year, it was 91%. So it's a marginal, so it's a 1% delta, which per the math I think ends up to about 50 advisors in terms of difference. So it's very much at the margin in terms of what we're doing. We unfortunately lose advisors to a broad range of firms and many retire or leave the profession. Andrew Humphries, We've done that from day one. And as I said, we have a very, very good team. And if anything, we've actually recently strengthened the team earlier this year. We strengthened the team. We brought some additional folk on because we indicated back in February our ambition to be able to see the advisor numbers grow from 2027. therefore there's normally a bit of a time lag in a pipeline in terms of building up on that so we've started investing in that piece and the other component is the academy and the academy over the first half of this year has been very very busy we've seen good numbers coming through in terms of We've seen great demand for advice and a real positive reaction to our campaign of trying to encourage more women into the advice profession. So we've been active in that regard and we've seen real tick up and interest in that for the longer term. But over the course of the last six months, the Academy has actually contributed significantly in terms of our advisor numbers. In terms of the broader pass-through component, again, just a little bit of color and context, we set out as part of our strategy in 2024 that one of our key pillars is having the leading advisor offering. and we want to make sure the St James's Place is the best place for the best advisors to join, develop in and build a successful career in business and we are laser focused on this. Also that the vast majority of our investment of over £260 million over the next few years is focused on improving our offering for advisors and hence for clients. Now, no one else in the market is investing in anywhere near this scale. And we think that's also why we have nearly 20% of the UK advisors within St. James's Place and nearly half of all new advisors to the profession come through our academy. Now, Remuneration or advisor pay is one of the components of effectively the offering that we have to advisors. There's so many other components to it. But to answer your question directly, The partner element that advisors retain of the advice fees we pay is about 80%. And I think a figure that's somewhat higher than many folk assume. So our focus as an organization, as an executive team, is on ensuring we have the leading advisor offering. Insuring we continue to retain, attract, grow our advisor base because we see the total addressable market as growing in the UK. There is a huge opportunity. Our growth algorithm we think factors on two key components, one of which is productivity increases and we're going to continue to stay focused on that, supporting our advisors in that regard. And the second is advisor numbers. So we're focused on both and we expect to be able to deliver both over the medium term. So hopefully that answers your question. Maybe a little bit more fulsome, but hopefully it just gives everyone a better sense of the broader colour and how we're focusing on these matters.

That's great. Thanks so much.

Thank you. And the next question comes from Naseeb Ahmed with UBS.

Thanks, Monique. Thanks for taking my questions. Maybe I just want to follow up on the two points that you just made, Mark. Can you give us the number? So you've basically hired 500 advisors. What's the split between academy hires and lateral hires? Is it 50-50, 300-200? And then on the 80% retained by advisors, I mean, it's hard to get the maths. I mean, you've given us the number, but another way of asking the question would be the 25 basis points that you retain. How much of that is actually consumed in helping advisors on business rates, indemnity, insurance, et cetera, right? So just trying to see the 25 basis points revenue margin, how much of that are you retaining net of costs for advice? And then on slide 24, you show that kind of the EY chart, which is helpful. Quilter have a similar chart and they've got 1.56% on the 10 year, Thank you.

So I'll ask Caroline to give a little bit more colour on the element of the 80% and how that's compiled. On the chart, I think we've got 16 competitors. I don't think we named them, etc. or set out who they are. I would expect them to have all the usual suspects in them on that way. So I can't comment on what others have done and how they have have compiled their numbers. Let's see, on the element of the breakdown of the advisor numbers, we're not looking to kind of give granularity on the academy or the recruitment element in terms of our specific numbers, other than to say I think both Thank you very much. In addition, we'd also expect to have more lateral hires. We think that the new fee structure that we set out in and we've pivoted to from August last year actually means that there are some advisors who previously weren't necessarily fans of the old regime in the marketplace who would now be receptive to a conversation with St. James's Place. and then finally I'm also very conscious of the fact that there's been a lot of consolidation, a lot of movement around the market and not every advisor that's been subject to some of those acquisitions are thrilled by those so there's an opportunity for us to be able to lift out a few advisors from some of those organizations so we're spending considerable time and energy around that so I think it's fair to say that as a team We are very focused on retention. We are very focused on acquisition and we're very focused on creating a long term pipeline for the profession through the academy. Caroline, do you want to give a little bit of extra color on the

Yeah, so to look at the 80%, you have to consider obviously together all the initial and ongoing advice fees that we pay to partners, plus the allowances we give them. So we pay out two thirds of initial advice charges to the advisors. This obviously increases substantially to all the initial advice charges when you add the other allowances we pay to the partnership. So that's consistent with what we said under our new charging structure, the sort of new business makes minimal profit. when you add in the amount we pay on an ongoing basis there's two elements to this there's obviously the 55 out of 80 basis points under the the new charging structure but then you've also got under the old charging structure advisors got all the ongoing advice fees so it's a combination rather than specifically picking out any of the specific costs so you have to take all that together and once you're off gestation can you just confirm that you're that that 80 becomes

75 or greater than 75?

Sorry, say that again, Nazeem.

So you're paying out 100% on all of the thumb that's in gestation, but once that runs off in, let's say, 2032, that 80% becomes 75.

It reduces, not 75, but it reduces a little bit, yes.

Thank you.

Thank you. And the next question comes from Andrew Crane with Autonomous.

Good morning all. Three questions if I can. Caroline, on slide eight, you make the point that results were lower in the first half of 25 because of the lower initial and ongoing margins. But then you say whether this effect extends to full year 2026 will depend on how markets develop in the second half. I just want to explore the implication of that. If markets are normal, is the implication of what you're saying that the second half profits will be higher than the second half 25? That's the first question. Second and third questions, just can you update us a bit more on the high net worth initiative? and also on the Flagstone cash transmission. If I'm transferring cash now from Flagstone into St. James's Place, how long will it take me?

Perfect. All right. Well, why don't I start with the High Net Worth piece and the Flagstone, and then Caroline can pick up on the second piece. So High Net Worth will continue to be part of our strategy. Over the course of the last six months, we've got a dedicated High Net Worth program and leadership team They've begun a significant increase in high quality private client events to be able to deepen engagement with expanding our central advisor support to enhance the servicing of high net worth. We've launched a pilot high net worth training program with one of the largest practices, paving the way for a broader rollout next year and increasing the volumes of high quality practices serving the complex high net worth client need. So the high net worth component continues to be a very important aspects. And I think our investment in this area and the energy and commitment of resources we think will deliver more consistent and somewhat differentiated high net worth experience. In terms of Flagstone, so in the second half of this year, we are expecting to dramatically change and we're working closely with Flagstone on dramatically changing the length of time it takes to move money from Flagstone into St. James's Place. So I would expect we'll be able to report that that is all done and dusted when we chat to you again. It's a key component of the engagement with Flagstone. In the meanwhile, with Flagstone, what they've done is they've massively facilitated take-on procedures. So most of the information is now auto-populated across from St. James's Place. And the rates that clients are getting has improved. The level at which clients invest has been lowered a bit to make it more accessible. and we've seen an increase I think it's to 5.9 billion looking at the team yep for 5.9 billion now in in flagstones so a meaningful increase clearly just you know talking about clients in the markets generally UK markets you know confidence in in in global economy and in the uncertainty and wishing to have have some in cash and this is an incredibly effective and efficient way of um I've been able to get your cash to work a little bit. But ultimately, as we all know on this call, the UK has a broader issue in that people are over-saved and under-invested. So at least through Flagstone, our advisors have great visibility of what's in Flagstone. And as part of their general engagement with clients are Exploring the size and scale of Watson Flagstone and what possibly could be, should be invested because the opportunity cost of being in cash versus being in the market is quite significant, as I'm sure you're aware. Caroline.

Yeah. Thank you, Andrew. Yes, look, I think I'm actually not sure what a normal market is anymore, actually. But put that aside, if we think it's something normal, second half of the year, yes, we would expect probably that half to 26 profits would be higher than half to 25 profits. But as I said, it all depends on markets.

Thank you.

Thank you and our next question comes from David McCann with Deutsche Bank.

Morning team, thanks for taking my questions. Two for me please. The first one to follow up on the advisor retention piece. Obviously a few questions you've had already about the split of shareholder and advisor economics but I just wanted to drill into that a bit more. Obviously your questions are really focused on what is the current split. The question really is, do you see this changing going forward, given the comments you made about the competitiveness of the market and obviously what we're all seeing? And adjacent to that point, are you still expecting roughly flat overall advisor numbers over the whole year? And then the second question is on flows more generally. I think it's fair to say they remain at the softer end, I think, where most people would perhaps like to see them. So maybe you can drill into why is that the case? What do you think it will take for them to positively inflex? and indeed, do you have any medium term aspirations of where you'd like them to be for the business of your size? Thank you.

David, thank you. In terms of advisor retention, advisor numbers, just generally, I think, as I said earlier on, The element of advisors and our leading advice offering is fundamental to who we are as an organization. So we are laser focused on ensuring that we have the very best offering to advisors in the round. So when we talk to partners, advisors about why they join us, why they stay with us, they tell us, you know, the academy is so valuable to them. The element of really joining a community, they don't feel alone, isolated, they're part of something much bigger. The ongoing technical support, training, advice, etc. We also have the highest concentration of financial, chartered financial planners in the UK. So it's another way of saying we have the highest quality financial advisors. The unique investment management approach, the BSP program, you know, kind of growth and succession component. We also guarantee our advisors advice, which is really important for the advisors and the clients, gives them great confidence and a massive recognizable and supported brand. All of those components are part and parcel of what the leading advisor offering component is. And we will ensure that we continue to have a leading advisor offering. So we're constantly looking at it, constantly looking to see what we need to do to ensure that we are providing the best all-round offering. Part of that is around the element of how we support around technology and how we make the overall profitability of our advisors and partners' businesses better. So the element of how we do more for them, how we facilitate, how we support them will continue to be really, really important. As for advisor numbers going forward, I think our ambition would be that we would look to see kind of numbers flattish, as we said at the beginning of the year. And in 2027, we'd look to be seeing growth kicking off again in terms of advisor numbers based on the elements I mentioned earlier this morning around the fact that we have invested further in the academy and we've invested further in our recruitment team and all of these elements. By definition, have got an element of a lead time, so I'd expect to see them starting to come through late this year, early next year in terms of their contribution of that investment. Caroline, do you want to comment on the flows, please?

Yes, absolutely. Thanks, David. So, look, if I take the flows apart into their component parts, I mean, if you take the gross flows, we attracted... 10.5 billion of gross flows for the half, which is consistent with our record result, which we achieved in half one 2025. So and that's despite the sort of heightened macroeconomic and geopolitical uncertainty during the period. So we're happy with that. Advisors are busy. Case volumes are up 9% on H1 2025, although case sizes down a little bit about the same amount. So that's what I say on inflows. Outflows in absolute terms are up because that's given the strong sort of FUM growth. So average FUM in H1 2026 was up 18% on the previous half, well half on 25, but outflows have only increased by 16%. So our retention rate for the half was Thank you so much for joining us. So that's sort of it. But then if you come to net flows, which we know is obviously the sum of the two, with average fund higher, 18% higher than a year ago. And it's obviously a really good result for our clients. We're pleased with that. But inflows don't scale to the same extent as outflows, which generally increase with funds. So this dynamic is obviously reflected in our net flows. But they are in the 2% to 3% of opening fund, which is higher. Thank you very much. we're continuing our work and increasing our work on the productivity work within Amplify so what I would say is the two to three percent is definitely not a cap.

Great thank you very much. Thanks David.

And the next question comes from Christiana Holstein with Bank of America.

Oh good morning thank you for taking my questions. My first question It's just following on from the discussion on advisor retention, sorry. So I wanted to ask, there's been a lot of media speculation about a potential exit from one of your flagship practices, Sovereign Wealth. I was just wondering if you're able to provide an update here and whether they've actually provided notice to leave? And then how do you also intend to retain advisors and some in the event of a practice or partnership leaving? My second question is relating to AI. So I was just wondering how you think about shared economies of scale from your productivity benefits relating to AI and how do you also intend on reinforcing your large-scale advantages versus peers? And then I just had a follow-up question as well on net flow expectations. So I know you were talking about how you've done quite a bit in terms of the academy and improving productivity. Pricing is obviously not lower now. Remediation's pretty much behind. So in terms of accelerating this 2% to 3% net flows, given it seems like a lot of the building blocks are in place, how long until you expect to see this start to improve? And yeah, what are your expectations maybe over the more medium term? Thank you.

Okay, a nice cross-section of questions. So firstly, unsurprisingly, we're not really going to comment on an individual partner business within St. James's Place. If you don't mind, I'm sure you'll understand the reasons for that along that. I think just a couple of things just to remind or maybe inform people about. Firstly, when an advisor... Um, leaves. And as we say, it's, it's, you know, it's, it is normal that we will lose some and you know, would much rather not lose advisors, but we understand everybody's got their own personal reasons for that. It doesn't mean that the clients leave. The clients often find that actually what they have with St. James's Place is incredibly attractive for all the reasons that I've set out earlier in terms of investment performance, in terms of service, in terms of support, in terms of the brand, the advice guarantee, all these different components. They really matter to clients. And so we generally find that we retain on average kind of 50% of client fund. Another key component is that when a partner that has multiple advisors in a practice leaves, we do have those as well. As I said, we don't try and encourage that, but we'd much rather them stay. But if they do go, we tend to retain at least 50% of their advisors. That's just what the stats show. So the element of, you know, there is some dislocation, there is, you know, kind of time and attention that needs to be spent, would much rather not have it. But it's not an immediate flow that if somebody leaves all their all their thumb and all their business leaves with it. And that, I think, just talks to the testimony of the strength of relationship we have with multiple partners and advisors and with clients as well. And what it is that that clients value. On the question of AI and technology, and thank you for the question, shared scale of economics and economies of scale and the like, scale benefits for us really coming through in a few ways. One is in terms of our ability with fund managers to be able to extract greater margins, and unfortunately you and others on the call will be just generally seeing that across the sector. Two is an element of, because of our size and scale, Most of the big global IT brands work with us, talk to us, and because of our scale, we can negotiate very good prices for either ourselves or for and for the partners and advisors, making sure that they pay well below rack rate for any of the kit that they use or that they need, whether it be conventional technology or whether it be some of the newer AI capabilities and technologies. and effectively the scale benefits we look to put back into the business. So the scale benefits and just general kind of efficiencies are part and parcel of how we've been able to pay for and fund the elements of the changes we made to The fees that we're paying to the advisors from later this year and for next year. It also, going forward, I think will be how we will look to reinvest back into the business in terms of technology because the pace of technology is constantly evolving. It truly is exponential, not linear. And therefore, I think how we continue to evolve our technology stack and how we continue to ensure that advisors get the most streamlined process as possible is going to be really really important because ultimately what advisors love doing is being in front of their clients The admin piece just generally, you speak to any advisor around the world, that's not why they do what they do. So wherever we can, minimize that component, maximize the opportunity to spend in front of clients, because that's where the buzz, that's where the adrenaline, that's where the rush comes from. So that's the piece that we are really laser focused on. We have mapped out the client journey. We've mapped out the advisor journey. We understand where the pain points are. And one by one, we are knocking these on the head to give the advisors more time, greater efficiency and great ability to improve. and part of the pilots that we've been running have shown increases in new client acquisition for those parts of the business that have been part of the pilot. We've seen for some of the smaller practices where they're using some of the AI, a significant uptick in terms of client numbers and a significant increase in terms of productivity. So as we roll these new technology and capabilities out throughout the partnership, and then as we help them optimize that technology into their processes into their systems we'd expect to see the advisors been able to do more and actually be able to support their profitability and allow one of the earlier points and then on the net flows expectations um one of the things that we have Tracking quite carefully is through partner productivity and partner advisor productivity we have seen from a case count increase quite significantly. So last year was a very busy year and we all know why it was a very busy year. It was a very busy year and last year, first half last year and first half this year, we've seen a 9% increase in the number of cases that advisors are talking to clients about and engaging with clients on. and the case size is down 10% and largely I think that's a function of the confidence in the economy and we're seeing a lot more in Flagstone as we mentioned earlier talking to Andrew Green answering his question. So we do think that actually the advisors are very busy. When I talk to them They tell me how focused they are on what they're doing and how they're growing the practice and how they're looking for new advisors and how they really feel they're making a difference in society. And to me, that's why I'm here because I want to facilitate and enable more of that because what we do, what our advisors do, It's really important. It helps people's lives. So net flow expectations over the medium term, I would expect them to start pushing through the 3% level on the basis, again, we need to be very alive to what happens in the economy, what's happening with confidence, etc., because we don't operate in a vacuum. but we are moving into the Amplify phase next year. The Amplify phase is a serious growth phase. You've seen the consensus numbers in terms of the profitability. We're looking to continue investing in the firm. St. James's Place is very different from what it was a year ago and it'll be very different in a year's time and in two years time. We're getting better and better at what we do.

Great, thank you.

The next question comes from Ben Ivers with RBC.

Morning, questions in two areas if I may. Just on the flow outlook and trying to tie that back to some of the advisor growth discussion this morning, I wonder do you think that the higher profile departures that we will be reading about will be noticeable in the net flow result in 2027 just in terms of outflows or given the movements you're talking about and the sort of the general ebb and flow should this effectively be a wash given that capacity is expected to be constant and the guidance around growing the advisor numbers next year and secondly on the BSP process can you provide some colour on how that process typically works for larger firms how do you mitigate the complexity of splitting up larger books of business to help retain those assets and is that complexity playing any part in any of the higher profile advisor movements that we've been reading about recently?

Thank you. Ben, hi, good morning. Thank you for those two questions. I'll ask Caroline to pick up the BSP process. BSP World reports into her, so she's all over it. In terms of NetFlow results for next year, There's going to be so much more at stake than necessarily a number of advisors leaving. How the economy does, what the government does in terms of any budgets and the like is going to be a real factor and just general consumer confidence I think are going to be very real elements. Ben, if you think of the stats I gave just in responding to Cristiano's questions on our retention of FUM generally and our retention of advisors when a partner leaves with a number of advisors, that if you get into that world, you effectively say that quite quickly, you're talking more like 25% of the FUM that may be at real risk of an outflow. And as you can imagine, we are very keen to try and retain as many of the clients as possible. We have lots of clients who do stay and we'll continue to try and support our clients if they wish to stay. Clients are free to move as advisors are free to move. And therefore, like in your business, every day the IP walks in and out of the door. We need to create an environment, a culture, community and environment that people want to be in. And that's where we are laser focused. That's where our time, energy as an executive and as a board is focused on on that piece. Caroline, BS, please.

Thank you for the question, Ben. I am very passionate about this area. It's one of our big USPs and it's an absolutely fantastic thing we have here. We're spending a lot of time and energy and effort on this. The short answer is no, it isn't a problem for larger practices. We work very hard. We're doing management buy-ins, management buy-outs, employee ownership trusts. We have a succession consulting team we've set up that now works with businesses like the real world. If we have time to work with people, we can do basically anything. We can work with teams on any of those measures. We've got a great corporate finance team. We've got great relationship with our lenders. We've got a lot of people who can work through the different problems that come with larger businesses. But to give you some real live examples, in the first half, we did our biggest BSP ever. which sold one of our top 10 businesses into another one so that's the biggest one we've done and also we've also this half we had a smaller business buying a business which I think was about three times bigger than it so we're also helping businesses you know you can have things like that so absolutely not I mean things the bigger they are the more time it takes but we have all the people the funding and the ability to do that so it's you know it's exciting times and we're continuing to evolve that proposition.

Thank you Caroline. Just a little bit of an adjunct on my response to your first question as well is feedback we've had from the partners off the back of the announcements on Friday last week have been incredibly positive. and partners and advisors up and down the country saying that they plan on using the catch-up payment that we will pay them in March next year to invest back into their business in terms of capability, in terms of advisors, in terms of growing their business. So there's a real... confidence in the partnership in terms of growth and every quarter we are releasing new and improved technology and elements which are giving people and giving our partners and advisors greater confidence in our ability to get things done so that we can progress and we can make their lives easier so all of that should support the earlier message that I gave as well but thank you for those questions Ben. Thanks for the answers.

Thank you. And the next question comes from Gregory Simpson with BNP Paribas.

Hi, morning. A few questions from my side. Firstly, are you seeing any behavioral changes or different client conversations around pensions given inheritance tax, the inheritance tax changes going on next year, just where it's a big part of your flow base? Second question is, If you did see a pronounced shift into index funds like some other advice businesses have seen in the UK, how would you see that impacting your net profit margin from fund? And then finally, just on that 50% retention rate of clients and advisors that do leave, do you think you can proactively increase that over time through better efforts and connecting advisors with clients and so on?

Greg, thank you. So the world of advice has become more complex because of the inheritance tax changes which land in April next year. So we are seeing advisors, partners talking with clients where they have a large pension fund and engaging with them on Paul Loftus, We have seen an impressive take up on Polaris Multi Index since launch, launched in October last year. It now stands at 4.6 billion. Some of that is new money coming in. Feedback from clients has been overwhelmingly positive. Many clients have been asking for something like this for some time. So it's been great that we've been able to give it to them on that particular patch. The margin, the profitability of Polaris Multi Index is appropriate and we don't feel that it would necessarily be a drag in terms of our margin because there's quite an active asset allocation layer that sits above it. And then finally, in terms of the 50% retention, Let me just elegantly say that we're not sitting on our hands. We will do and we will engage with advisors, partners, clients to try and make sure they understand the direction of travel that we are taking, what we're doing, and why we believe that St. James's Place is the best place for them to grow and run a business, regardless of what Competition may or may not be offering. So the environment is more competitive. There's more consolidation happening, and I expect that to be a case. In light of that, we are going to be active in the market as well, as we have been for the last 34 years.

I'd just add on that, Greg, on the index, obviously it's our fund manager that where our cost benefits comes from, we can use our scale advantage and work with their scale advantage and that's where we get the benefit of the value on those funds. Thank you.

Can I just quickly follow up, actually, all the changes around advisor remuneration in the last week or so, do you see that as being fairly neutral to the

you know that net net net net fund margin kind of guidance yeah yeah it's within that any funding was done within efficiencies we've made within the business uh margin the guidance still stands the margins and the margin guidance still stands here thank you so just as a reminder to all attendees that to ask a question it is star one on the telephone keypad and our next question comes from Alex Bowers with KBW

I just had two questions from my side. Just firstly, a number of firms obviously scaled very successfully under the SJP mall historically and now being poached by consolidators. It feels kind of logical that consolidators will continue to target these top firms within your business. Just interested to hear if you can give us any colour on kind of conversations you've had with other big partner firms within the SJP network and how you're kind of responding to this threat. The second question is just around the kind of size of new partner firm you're looking to bring into the network. Given you've lost some larger firms, are you looking to replace these of kind of like-for-like sized firms, or are you happy to add smaller firms and allow them to scale? Thanks.

Alex, thank you. I think it's fair to say, Alex, that we have a very active programme of engagement with our firms within St James's Place, and we will continue to have a very active programme. We have a number of consultation groups where we consult with partners and advisors on various matters before we decide on them so we're trying to do as much as possible with the partnership rather than to the partnership and ensuring that what we do lands well is clearly understood and is really focusing on the things that matter to the partnership so we have a very active line of dialogue always have and I expect we always will because it's are USP, and you look after, you protect, and you polish your USP. So we're very, very focused on that piece. In terms of size of folk coming in, we have and have had practices of all different shapes and sizes coming in, et cetera, along the way. Our existing firms are growing. We have a good smattering of firms that are very large, some that are medium-sized, and a lot that are in the smaller element, et cetera. Thank you.

Thank you and our next question comes from Charles Bennett with Rothschild.

Hi Mark, hi Caroline, thanks for taking my questions. Hi Charles. Hi. 2023 to 2030.

Sorry Charles, would you mind starting that again? We missed the beginning of your question Charles.

of course don't worry so the first question is you reiterated confidence in doubling adjusted profits from 23 to 2030 what markets and net flow assumptions from here are now embedded in that doubling assumption and do you expect to revise that profit target up or down as we get closer to 2030 or are you going to manage the business so that that's roughly where you end up second question you talked earlier in this call about your growth algorithm having two drivers productivity and advisor growth where do you see that second driver trending over the medium term noting that it's been a period of relatively slower advisor headcount growth versus history in the last few years just keen to understand where you'd like that to settle long term and whether the academy and the advisor headcount movement in the industry more broadly can support that long-term rate and then thirdly I think you've talked in the past about Thanks. Okay, all right.

Why don't I deal with the second element in terms of the growth algorithm question and then ask Caroline to pick up the first and the third. So in terms of the growth algorithm, as you said, I mentioned productivity being very, very important and advisor growth also being very important. And we said last year Thank you very much. I would expect advisor growth to increase to low single digit growth going forward. I do think that the industry as a whole has been, you know, in terms of advisor numbers growing at less than 1% for quite some time. And therefore the Academy is going to have to do the lion's share of the heavy lifting on that. Because we've been doing the Academy for the last 10 plus years, we know what it takes. We know what's required. We have a great pipeline of recruiters. We know the type of people we're looking for. And we think the market's actually very attractive for people to come in and join us. through the element of the academy. So advisor growth, we think will be real and meaningful. And we think the productivity will also be a very, very important lever for us to pull. And we are focused on both. And we're looking to grow both productivity and advisor growth from 27 onwards. Caroline, in terms of the WAC,

So the doubling, yeah, I mean, look, that's our ambition rather than the specific formal guidance. We're staying with that. We set that in 2024 when the world was a challenging place to get people to look out further. We're not necessarily going to retrade that right now. Obviously, we guide every year. I mean, the assumptions around that sort of mid to high single digit increases in FUM every year, going back to sort of normal markets type thing. We are, I would absolutely say, as I did with Lowe's, it's not a cap. Definitely not a cap on our ambition, but we will obviously guide every year as we go towards that. On the actual expenses on fund, when we did our new simplification of reporting, we had a lot of debates about how we should do this. And really, for simplicity, we don't give that breakdown. We find that both income and expenses obviously vary with things like daily fund levels but we pay out such as obviously other than the margin we pay out significant amounts of that so that we just we're just not we're not having that we're not giving that amount of granularity.

Yeah, Charles, just to reinforce what Caroline has said, we wouldn't see the ambition as a capital industry. I'm not going to manage this business and curtail growth. We're going to grab every piece of growth that we sensibly can, that is quality growth, because the opportunity is so huge out there. UK advice, on average, 9% of folk take advice. In the US, it's something like 27%. So the UK market should be able to grow at least two to three times and therefore the growth opportunity for us is huge and we're going to look to prosecute that as best we possibly can.

Thanks so much. Thanks Joss.

Thank you and that was our final question so I will hand back over to you Mark for any final comments.

Okay, thank you for your time today, everyone, and questions. As I said at the outset, we're very pleased with the progress we've made in the first half, both in terms of performance and in terms of operational execution. And we think that with strong foundations, continued investment in our client and advisor proposition, and a clear strategic direction, we remain very confident in the opportunities ahead. Thank you very much, and I'll be chatting with you over the course of the coming days and weeks. Thank you.