Hargreaves Lansdown plc

Thank you, Maxine, and good morning, everyone. Welcome to Hargreaves Lansdown 2021 interim results call.

Thank you for joining us. I am Chris Hill, Chief Executive.

I'm joined on the call by Philip Johnson, Chief Financial Officer. You all already have seen this morning, we put out a strong set of numbers.

There are, I think, often questions to ask about the cyclicality of our results and rates of growth. My answer is invariably linked to the external environment and its impact on client confidence.

However, these results show that through the cycle, and there will be ups and downs, this business is delivering long-term growth and that trend should be the focus rather than quarterly movements.

Thanks, Chris. Good morning, everyone.

I hope you're well wherever you are. 2020 has been an extraordinary period in so many ways.

In our space, there are huge sector and generational things happening, a whole new level of engagement by people with investment all around the world, something was necessary and in the long-term will be enormously beneficial for society. And this engagement is seen most strongly in businesses like ours, ones with market-leading franchises, offering straightforward asset classes, tax wrappers, and high-quality technology and tools match to the products and services, a business that allows its clients to take control of their world, their financial future to save and invest with confidence.

Hargreaves Lansdown is a digital wealth management service. We build lifelong relationships with our clients, attracting and then engaging with them to support their journey towards their desired outcomes.

And it's this engagement, activity and growth that are all reflected in our very strong numbers for the first-half of the 2021 financial year. Revenue increased 16% due to our diversified income streams, leading market positions and powerful net new business tailwind.

Profits, which factor in the client’s and ex client acquisition and activity consequences of this extraordinary period grew 10% to £188 million, once again, bigger than our revenues were just four years ago. And all of its growth was delivered -- was being there for our clients throughout the door.

We've not had to seek government assistance, nor have we had to furlough any employees or enact any redundancies. These are challenging times and uncertainty still lies ahead.

But the Board remains confident in our prospects and momentum, and has therefore increased the interim dividend by 6% to 11.9 pence per share.

Thank you, Philip. So we're on to Slide 13 of the deck.

As I mentioned before, the business model has behaved exactly as I would expect it to given the external conditions. Q1 was characterized by widespread volatility and uncertainties driven by the U.S.

election, Brexit and the pandemic. We saw a resolution of these issues in Q2 with certainty regarding the next President, which coincided with the news regarding a vaccine.

And by the end of the calendar year, the Brexit issue has moved on. All of this saw investor confidence, which had been weakening through July and August, pick up and then race ahead.

And our results have reflected that journey. In the last six months has set records for an HL first half, including our biggest ever growth in net new clients at 84,000, alongside very strong net new business of 3.2 billion, which has helped to drive our AUA above 120 billion for the first time.

HL provides a market leading client experience that's underpinned by a proposition in service that's built around client needs. And it's through this that we continue to attract and engage greater numbers of clients throughout the period, and extend our leading market share.

As a consequence of this, retention has remained strong at 92.9%. But stepping back and looking at the trends, which actually started pre-COVID and have accelerated during COVID, something I'm going to pick on in more detail in a moment.

This growth has been driven by the continued structural shift towards self directed savings and investments, especially younger generations wanting to plan for the future and to manage their wealth online. I'll talk about the market dynamics in a moment, but I want to reiterate here on Slide 14, why HL is positioned the way that we are, and why we focus the way that we do.

I've outlined it before, but HL has a large and growing market opportunity underpinned by a number of societal and structural trends. With an increasingly complex savings environment, persistently low interest rates and the transfer of responsibility to individuals to manage their financial futures, Hargreaves Lansdown is in a position and has a strategy that can provide the help and support that clients need.

We understand that need.

Thanks, Maxine, and thanks, everyone. Good morning.

Three from me as usual, if that’s okay. Firstly was on cash margins.

I thought that guidance you have given us is really helpful today, but just really wanted to clarify if the 10, 15 that you've guided for 2022. Is that essentially in line with what you're getting in terms of new investments today?

Secondly was just -- you've cut the charges on your HL Funds range, as you mentioned, that’s the value for money analysis. But really just wanted to see if you feel this has gone far enough and the funds are still charging between about 1.06% and 1.56% annual management fees.

That's quite a bit higher than some of the other fund – fund-to-fund ranges out there in the market, including available on your platform. So just thoughts on that.

And thirdly, on stock trading, again, you've given us super helpful color today. But one thing that perhaps wasn't mentioned was some of the Reddit trading stocks and things like that we've seen over the last week or two, just really wondered if there’s any color of what you've seen there?

Thanks.

Right. Sorry, just working out to take those questions.

I'll take the first of those. So cash margins on 10 to 15 basis points.

I mean, I hope you heard me say there are massive amounts of caveats around this. And I think if you look at the bank interest rate and the bank yield curve, you can see without me telling you what sort of rates we can get right now.

And when I say we, I mean, every provider that's putting money forward for 12 months will be getting similar rates right now. I think the yield curve actually to 12-month money isn't very far off, if not below the base rates.

And these things are always a combination of bank demand for your money, and also the rates that you can achieve. So I don't pretend to be an interest rate commentator.

I've suggested where market data exists on this one. It's just like equity markets.

They go up and down. Interest rates have come down.

On the bright side, most of the space is to move from here is now upwards. Chris, you want me to take the funds one as well?

Go ahead.

Okay. So this is a value proposition, Andrew.

And like all fund managers, we have to look at the clients and the types of how well our proposition delivers value for an enormous number of factors. And I'd encourage you to read our value for money publication.

This is very helpful in terms of the categories through which we consider value of which fees is part one. And you'll see the way that we have concluded on the various categories of those, including fees, and therefore the responses that we're proposing.

And clearly, we, at the moment, believe that what we have done is appropriate. We think that, in particular, sharing economies of scale with fund - as you grow, is an incredibly important thing and something that the industry hasn't really offered.

For our clients, remember, unlike some other parts of the market, when we deliver price cuts through to our investors on our own or other funds, that all flows through to them. And that's what we're focused on is.

In this, as in every other part of our business is delivering an extremely strong value proposition. You can see in the growth and client acquisition and engagement and activity that what we have is a really powerful offering for the future of all digital wealth management.

Thanks, Philip. I'll take the next one, Andrew, about your question around the stocks.

Look, clearly, we’re the largest retail stock broker. We've got a 40% market share.

So, we'll see that share of any of the retail activity that you see going through. And I think for us looking at the events that happened last week, and you'll see this, if you look at the content that we put on the website, which is very much a cautionary one, making sure that clients understand the difference between speculation and investment.

Because our focus, and I've said here, our purpose is helping people to save and invest with confidence. And we talked about this at the full year numbers, and the content we were providing to people who are starting to save and invest very often who were investing in shares as sort of their first experience.

The material that we were providing to them was about the benefits of investing through tax wrappers, the benefits of diversification, the attributes of successful long-term investors, because that's our focus. And through -- obviously, this isn't the first rodeo that we've seen.

We've seen Bitcoin, gold price speculation, 2008 financial crash, the dot-com bubble, all of these things. And the way that we focus on this is to make sure that our clients are well informed, and make sure that we've invested in the platform to ensure that we can execute when they decide what it is that they want to do.

And I think if you look at the - some of the metrics that are put in there, 153 million digital visits. Even 25 million minutes being spent reading the content.

We're providing that content that helps engage clients and help them to be informed as to what's happening, and then make it easy for them to be able to act. But our emphasis is on long-term value.

Our emphasis is on building a lifelong relationship. And these younger clients, you bring a client on in their 30s, you want to have them as a client in their late 80s.

And at that stage, you want the money that's gone into the Junior ISA because it's being passed on to their grandchildren. That's where our focus is.

Very helpful. Thank you very much.

Good morning, gentlemen. Congratulations on the strong set of results today.

Can I have two I'm afraid quite numbers type questions for you please? First one in terms of revenues.

I think you said in the statement that the £8.6 billion of net new business you saw in 2020 is equivalent to £46 million of future annual revenues? Let’s assume that comes out about 53 basis points fee margin.

So given your funds platform margin is about 40 basis points and your shares is 59. I think this suggests about three quarters of your net new business with shares and 25% of funds.

So I just wanted to check whether that sounds right to you. And then the second question was actually about operating margins and costs.

Your 63% operating margin is pretty much in the realm of your recent range, 61% to 64%. To help us think about how this might shift from here, I was just looking at Slides 8 and 9.

And then just on Slide 8, you talk about £67 million of additional revenues from record volumes. On Slide 9, a £6.5 million increase in activity-based costs.

So I guess a £13 million annualized increase. So on that basis, it looks like the marginal operating profit margin for the increased trading activity is about 80%.

And again, I just wanted to check if that was correct. Sorry for the numbers.

Thank you.

Thanks, Haley. Those are both somewhat in the detail to be honest with you.

On the revenue side of it, I think you're being way too clever, to be honest with you. But I appreciate the sort of way you're trying to discern our comment.

It's just the average revenue on the entire group times the average rate that we earned. And the whole point of it is really not to get gunned down in terms of giving you incredibly insightful financial guidance, but to make the point that every single year, the clients that we add and the monies that are mostly our existing clients remember, it's about 80-20 the proportion in terms of existing.

And that's what happens when your book gets bigger. It's more and more driven by the existing client base.

It is forever increasing the amount of lifetime current and lifetime value of the business. This is a long-term business.

And I think we want you to understand that and our investors to understand that, because our clients are with us for an extremely long period of time. And when they stay with us, and Chris has shown you the accumulation of the assets the clients bring as they're on their journey to their long-term outcomes, this is what we were just trying to give in that particular piece of insight.

On the operating marginal contribution of share dealing, it does on the margin, everything that we add has a reasonably high attractive, incremental margin. But I would have to be honest with you.

Take that away and I think James and I would just have to get back to you because it's a question of kind of detail that I don't have quite at my fingertips.

Okay, I appreciate that. Thank you.

Just to confirm then, the 80-20 in terms of existing new clients, that hasn't changed, that's still the same this period as it was before then?

No. This is a stronger period for existing clients.

I think it's very easy to sometimes focus on new clients and sometimes I read stuff that implies that new business comes from new clients and is all driven by marketing. That's not the case as we have spent some time in results talking about marketing is something that we do to engage with our entire 1.5 million customer base.

And the flows that come from our existing customer base is incredibly important to drive in the accumulation of assets in new business, as Chris was showing you on, I think it was Slide 18.

Okay. Thank you.

Hi, all. Thank you very much for the presentation.

Just a few more slightly, pulling up on Haley's questions. On the net flows and operating leverage, and thank you for the detailed color on the longer term lifetime value of the clients, that was helpful.

But looking over the next few years, 3.2 billion for the first half, that’s a strong number, but when we delve down into the flows per customer, this was about 30,000 for the first half comparing to about mid 50s over 2018, '19, so it's been ticking down over the last few quarters. Can you comment on the strength, whether you're seeing a fundamental change in the customer behavior in terms of the split between longer term investing and stock trading?

And how does this impact the cost term, presumably operating leverage is impacted if guidance is to think about costs in line with customer acquisition? And secondly, on the cash margins, you've given us a bit more color on the assumptions.

But can you sort of tell us what kind of buffers you're baking on ability to negotiate better rates from partner banks? And how we could think about margins if theoretically, rates were to go negative in the UK?

And finally, on technology? Should we expect more ongoing investment here, given some capacity issues last quarter, or are we largely done there?

Thank you.

Okay. I think those are essentially all three for me.

Let me take the first bit of that. Look, 221,000 new clients in a 12-month period is most certainly a record for us.

Therefore, we got 1.5 million overall. I think as I've demonstrated, we've got a pretty small market share of a 2.4 trillion market.

So I think that there is plenty of opportunity and we have the ambition to grow within that. And the dynamics that I'm showing you on Slide 18, demonstrating the consistency in terms of how clients build up their investment ports over time, and reflecting the changing demographics that I have been talking about for the last four or five years with the increase in that younger mix coming through.

And obviously when clients start out, they don't have so much money. But they're starting earlier.

And then they're building those assets over time. And when we look at -- this is part of what I talk about having an insight at scale.

You get to see actually at scale, how cohorts of clients are behaving and how they're growing assets over time. And I think there are different trends that come within that in terms of what comes through in terms of -- younger clients won't have so much to transfer through.

All the clients do. We've got more older clients.

We've got more younger clients. You've got clients who, as I said, starting out with an investment in a share.

That's how they've been introduced. That's how they've started.

But actually, if you look at what those clients do over time as we engage with them, and help them to understand the benefits of long-term investing, you've got more clients then who are moving in to investing in funds. We've got -- in this year we've got almost twice as many people investing funds as they did last year in terms of new clients.

So you have to look at the scale. The scale is the important bit here, because that's how we understand and get the insight and can understand what clients are doing.

But also understand then how to engage with clients. And then on your point around technology, so we are building the leading digital wealth management platform.

And we will continue to invest in the technology that supports that. I’d say if you look over the next three to five years, you'll see the increasing importance of digital technology and how that is used to interact with and improve the client experience.

Now that has much clients on the frontend, but also ensuring that we are investing in the scalability and resilience of the platform. So yes, we had the issue on vaccine Monday, which impacted a small number of clients that we then worked on needed to resolve, but we've acted as a result of that.

That day, we did 125,000 trades. Philip’s already given you the metrics that pre-COVID averaged about 20,000 a day.

Now probably that has shifted to about 40,000. But we still see these spikes.

We've got the capability to deal with those spikes. Even the day after vaccine Monday, we had over 100,000 trades done.

And we've had days over 100,000 -- a number of times since we've seen that. So, I'm really clear that we have put in the investment to ensure the scalability up until now.

But we will continue to invest in technology to support both the scalability but also to develop and enhance the experience with clients. Because that's what a digital wealth management platform needs to be able to do.

You had a question about cash margins as well. I don't have anything to add to what I said already that you can see out there cash margins and base rates.

I've said previous result that we’ll do the best thing we can to get the best rates we can from banks as a counterparty. I think if rates go negative, we'll have to respond and deal with that as the whole market does.

But I really wouldn't get hung up on that. We're now talking about a sliver of income in our entire business.

And as Chris has just outlined, the most important exciting thing about this business is how we help our clients on their journeys and what that means for the asset accumulation. It's the asset accumulation and funds and shares, because we want our clients to be invested.

Okay. Thank you very much.

Good morning and very impressive results. I have two questions.

In the statement, you talked about launching a new cash ISA. So what can you tell us about that in terms of the timeline, its connections, active savings, and also any margin guidance you can provide?

And the second question is on the pipeline for back book transfers. Has COVID impacted any discussions on this?

Is there anything in the pipeline at the moment?

Okay. Thank you.

Good morning, Rhea. So it's early days, but on the cash ISA, we only soft launched at the end of November to a very small number of existing active savings clients.

We then highlighted to a further 2,000 I think it was in December. Then over the next few days, we're going to start marketing it to the rest of our 80,000 plus active savings clients and then later in the year we'll start marketing to our wider client base.

There is currently only one offer available with the Coventry Building Society, but we'll look to add further banks in the coming months. And we're also working on the functionality to enable transfers, the existing cash ISAs elsewhere.

And remember transfers where there is significant opportunity, there's about 270 billion of cash ISAs out there, much of which is currently earning very poor rates of interest. Active savings remains part of our core strategy for the digital wealth management proposition.

With interest rates low at present, I think it remains a tough environment for the cash savings products. But what we offer helps clients to manage their savings more easily.

And typically, it enhances the rate of interest that they earn. And then I think your second question was just around the back books.

Look, as and when opportunities come along, we are interested. We see ourselves as the go to platform for fund groups to deal with, given the experience that we've got such deals and the quality proposition that the migrated clients end up with.

We've seen through the periods -- a couple of books of business that be made available through a tender process. We looked at both in the initial stages, but we decided not to proceed with those.

So we remain open to those that arise. And we will look at them very carefully and scrutinize them when they come around.

Great. Thank you.

Good morning, everyone. I just have a couple of questions.

Firstly, could you give us any guidance on the marketing spend in this next six months? Usually, there's a lot more marketing spending in the second half, but you seem to be going hammer and tongs at the marketing certainly from my email box in the last six months, so some guidance there.

And then if we come to Slide 18, I know you can dodge this question. But in broad construction, could you give us the scale?

So if you looked at clients between 45 and 50 versus your new clients at 37, what is the increase in the average portfolio values? I don't need the exact too, but just give us a sense of it.

Interesting questions there, Andrew. Look, on marketing spend going into the second half, we've clearly got tax year end just ahead of us and that is extremely busy time for marketing.

You'll see actually as well over the next few weeks, there's an additional marketing campaign that we're pushing out really associated with building the brand awareness. And I bring you back to the comments I made about attract, engage, retain.

But building the brand awareness, we have a – I see us having a relatively small market share of that 2.4 trillion. And building and enhancing our brand has proved successful to date and I'm keen that we will continue to do that.

And on Slide 18, no, I'm not going to give you -- I'm not going to give you the scale. We've gotten the data back, the average hold per client.

The important thing that I'm getting you to do is to think about what the average client ages, you know what the average holding is? And is to think about actually how in aggregate cohorts of clients will build and scale their investment over time.

Hi. Good morning and thank you for taking my questions.

Just a few. Firstly, the data pack shows there were quite strong flows into the Vantage fund and share accounts in the period, I think 1.2 billion versus 0.8 billion for the ISA and SIPP age.

So what's the retention rate on this type of account versus the 93% group average? And what efforts are you doing to try and ensure that any shorter term traders stay with the company and become longer term investors?

The second question is about the PMS advice business. I know it's small, but in the data packet, it looks like it has 2.8 billion of AUA.

That's the same as what it was in June, despite strong markets in that time. So, is it fair to say the advisor business is having some outflows and losing clients?

And if so, what are the drivers of that? And then lastly, at a high level, it was interesting your comments around the cash ISA opportunity?

Did you see a lot of transfers from cash ISAs from banks into stocks and shares ISAs today with the zero rate environment or do you think having the HL cash outflow offering is an important step to accelerating that? Thank you.

Thanks for those, Greg. So the first one on fund and share accounts, and yes, we've seen -- you can see that the numbers that we've got in terms of people opening those – the retention rates across the three of them are broadly consistent, give or take.

We're looking at high levels of retention, around 93%. And as I've said, when we had seen people who have come along and started to invest in their first experience by investing into a share, then if you were a client who has done that, you would find the content that you were starting to see from how we was talking to you about the benefits of long-term investing and the diversification.

And as a consequence of that, when I look at the 2020 cohort, and I can see that there is a consistency, if you like, your behavioral trends that people are then starting to diversify. They're also then starting to diversify by moving into -- by understanding and moving into those tax efficient wrappers.

And this is my point about making sure that you've got the right broad proposition in order to be able to support clients on a lifelong savings journey, helping them understand diversification, helping them understand the benefits of the tax wrappers, and we certainly are seeing those trains go through. And that's where our focus needs to be.

And then as far as the advice business, and PMS is not -- doesn't give you the full scope of the advice business, because there will be plenty of clients who we will advise and support, who will not be in the PMS. And the percentage is slightly over 70% of the advice fee that we get is from one-off advice.

So clients will come. They will engage with an advisor, because they've got particular questions that they want to understand.

So work with an advisor who will then set them up. They then understood that strategy and they're probably then comfortable as long as things stay within the sort of the trend lines that they understand how they want to invest over the next few years.

And I think that that is a very strong value selling point, because more and more people are now thinking harder and harder. Well, what am I actually paying an advisor for year-after-year for that 1%?

I can get all of the admin support that I want through the platform. I can get the engaging content, the information, the support, all of that.

And I can get that through Hargreaves Lansdown with a platform fee of 45 basis points. So why am I paying the extra?

So I think that's a very important -- it's a very important aspect to this when you think about it in the context of a much, much broader market. And then your final point about the cash ISA.

Yes, we are seeing high levels of transfers out of the bank and on to the Hargreaves Lansdown platform. That's not a surprise.

We've certainly seen that trend in the past when they’ve been focused on rates. And it's part of the commentary, the insights that I'm giving you on the market when I talk about what real people are thinking about right now in terms of the complexity of the savings environment, the longevity issues that they've got to manage financial resilience is much, much more important.

Low interest rates are a concern for them. And people are leaving from the banks and onto an investment platform.

And then our ability to support our clients with both their cash savings, which helps them to build up that short-term resilience, but also those longer term savings supported in the long-term tax wrappers, and educating them and helping them in terms of diversification over time. That's the focus of the business.

And that's what people really need. And then when you look at that in the context of how our clients behave, and I’ve said, the 2020 clients, they are similar in terms of quality over time, they are similar in terms of their investment behaviors, they are similar in terms of themselves invest in a breadth of savings, funds, as well as shares.

And it's building up this demographic really in that sort of 29 to 44 age group. That's building those up in terms of numbers.

47% of new clients that we brought on, they are then going to follow this trend in building up their savings. That's how to look at how this business is building up the long-term value for shareholders and frankly for clients, because we're supporting them over the long term.

That's great. Just a cheeky follow up, if possible.

The chart on Slide 18 is really interesting. It kind of cuts off at age 60.

Is there any kind of high level comment on what -- is that kind of the peak for portfolio value or does it keep increasing after kind of retirement and how do kind of retirees behave on the platform? Are they still --

It's a different dynamic, because what I'm showing you here is wealth accumulation mode and how clients build up. The dynamic then when you get on and into retirement and why we -- I've talked about the online drawdown process.

I’ve talked about investment outcomes -- retirement outcomes rather. We launched our investment pathways last week.

We're then providing people in that age group with the means and the support to then be able to live off their capital, live off their investments into retirement. When then it becomes a concern about managing and understanding your income and your investments and your liquidity and your cash alongside that, that's what a digital wealth platform then means to that cohort of clients.

Now, the interesting dynamics are which despite the fact we're going to be 40 this year, the interesting dynamics for that is we are relatively young and we have clients who are now getting into retirement. Whereas in the past, pre-pension freedoms, which remember only came in, in 2015, when people would then convert to an annuity and then go from the platform.

People are now holding the investments, holding them on the platform for longer. And that again, represents a different dynamic for us in terms of managing the lifetime value of the clients.

Got it. Makes a lot of sense.

Thank you.

Good morning, guys. Very interesting presentation in terms of the overall theme moving to the younger demographic and general interest in terms of retail participation.

Obviously with your leading market share, then I have to say in terms of my own two student terms, the bombardment of tax the last week in terms of general interest, then I suspect it's for the wrong reasons. But two questions, one for Philip and one for Chris.

Philip, I think you said the term you thought that the baseline for retail trading might now be either doubled or trebled. And just wondering what gives you the confidence to think that there might be a slightly more permanent nature to that.

And then, Chris, was just – I was interested in what you're saying around the advice piece as to whether there's a chance the whole advice model could move a little bit here in terms of people may be used platform in the main, but rather than having an ongoing advice fee or perhaps use it on a more one-off fixed price basis. I’m presuming that if the market can move that way, would you have any issues in terms of being able to recruit enough advisors to actually sort of service that model?

And whether you could assign specific advisors to specific clients on an ongoing basis, or whether they would just get whoever was available for a specific piece of advice? Thanks.

So I'll take your baseline share trading. I think the thing that I would say, which is observational, and in a sense I stood up in August and said, I don't know what's going to happen.

I need more data points. And here we have a whole load more today is it's pretty consistent.

It's pretty consistent. There's some -- I went back into history and there's some years where it's almost the same every day.

So you see that come up now. And in the period in between lockdowns, it came down to again being quite consistent, but there's a much higher level.

And actually, it came down less in between lockdown two and lockdown three. So I think the only thing that will settle this over time is kind of more data.

But what I would say is, as you note, people are just much more interested and engaged in their investment than probably as a society that I can think of in my career in financial services. There's an absolute wall of money that everyone observes has been saved during the past year.

We don't know whether -- how much of that will get deployed into investment over time, but it would need to be. And that engagement that therefore people have with investment will likely, and I think we can help them build balanced portfolios and build over time.

This isn't a particularly trading book. It's an investing book.

And whilst we're providing that level of engagement, then I think there's a strong likelihood that the base level has picked up and the business is much bigger than it was, the number of clients is much bigger than it was, it sort of seems common sense that therefore that floor level will pick up and combine the level of engagements and we'll just -- we'll have to wait and see. But I think it really stands a very, very good chance of being pretty solid.

So when you say investing book rather than trading book, what do you mean by that, in terms of what frequency of trades from the clients that you've taken on?

Yes. I think there's a propensity of people to come in.

And I think there's a lot of commentary, as Chris was talking about, about a very small portion of the business -- sorry, portion of the market. And I think if you're really looking at trying to execute what's probably an options driven, margin driven, leveraged style strategy, this is “share trading” but it's really -- kind of a lot of it is about building positions and opportunistic responses to price movements.

Okay.

Thanks, Philip. Paul, your second question around the development of advice, and I think you're right on it, because I have mentioned it a couple of times.

I do think that there is a significant challenge for the advice model. I do think when people engage more with their financial futures, which is quite clearly what we can see happening right now, as that knowledge builds, I think people become a lot more challenging about what they're getting in return for what they are paying.

And I think you've got the regulator as well that is really trying to get consumers to understand a lot more about value. And I think that poses real challenges for advisors if people are paying them 1% plus a year for what?

That's a question that people will ask. And as that then relates to Hargreaves Lansdown, look, I see advice as being -- I talked about building capabilities and having the right capabilities to support a digital wealth management service.

Clearly, advice is an important capability. But I want to make sure that that capability is easily accessible to all of our clients as and when they need it.

And they only pay for it when they use it. So I do think there's an opportunity for that.

I think technology -- as I've said, technology is a key one to ensure that we can support people in that way. Your question as to well, how would you do that with numbers of advisors and would you allocate particular people to clients?

That I think is a different level of detail. We'll have to think about that as it develops.

But what I'm focused on is making sure that that advice capability is available to all clients as and when they need it. We have a huge amount of insights.

Those 676,000 calls coming into our helpdesk, 275,000 emails interacting, 153 million digital users, that gives us a tremendous amount of insight to understand actually what clients are looking for, what they're asking for. And if we're able to give them the guidance to do that, if they're able to get the confidence to do what they need to do next, sometimes they don't need to have advice.

But at the times that they do, and those are important times, we want to make sure that it's easily accessible for them.

Okay. Thank you for that.

It was very interesting. Thanks.

Good morning. I've got two questions, please.

First, I'll just try again I think on the marketing expenses for H2 please. I completely agree.

It feels like there's a big opportunity around ISA season this year. Should we expect an increase in the marketing expenses in H2 kind of commensurate with that opportunity?

And maybe you could just comment as to whether or not you think growth in H2 on the lines of the growth that you saw in that line in H1 might be kind of a reasonable assumption? And then second question is around Woodford.

I think there is still some background noise in the press around potential for class action from the Woodford issue. Is there any update or clarification you can offer on that sort of background noise today?

Thank you.

Okay. Thanks, Ben.

So, look, firstly, on the marketing, and think Philip has done a pretty good job of actually giving you the visibility when things get busy, what our activity related costs are. And there is a large part of marketing that is activity related.

And secondly, I talked about the additional campaign, which is similar in size to a campaign that we did tax year end or round about tax year end last year. And we've both always said that when the market conditions are such that people are interested, they want to engage, that's when we will ensure that we're doing everything we can to turn on the taps to make sure that we're able to pick up that.

So I think that is very much linked to the demand that we see. And we will spend -- into that demand.

And then finally, the comment on Woodford, I haven't got any comments. I really haven't got any comment to make on that.

We can all see what's going on in the background. I've got nothing direct that I need to talk about.

Understood. Thank you.

I think we've come to probably the natural end to the questions. But James, Phillip and I are around the rest of the day if you've got other follow ups that you'd like to have.

But in the meantime, thank you for your questions. Thanks for dialing in.

Have a good day. And Maxine, I can hand back to you.

Thank you.