Rathbones Group’s pre-tax profit increased by 72.9% to £99.6m throughout 2024, compared with £57.6m by the end of 2023, according to its full-year results published today (26 February 2025).
Underlying profit before tax jumped from £127.1m to £227.6m, marking a 79.1% increase. Rathbones said the rise in profits was largely owing to the acquisition of Investec Wealth and Investment (IW&I) in September 2023.
The acquisition also accounted for a £43bn injection into the firm’s funds under management and advice. Meanwhile, Rathbones Wealth Management and Asset Management saw gross inflows of £9.7bn and £4.4bn, respectively, while gross outflows hit £10.7bn and £3.8bn. This meant that, overall, net flows across groups fell by £1.4bn.
However, market and investment performance injected £5.3bn into FUMA – with £4.2bn alone coming from the Wealth Management arm, meaning FUMA overall increased by £3.9bn throughout the year from £105.3bn to £109.2bn.
Rathbones’ underlying operating margin increased from 22.3% to 25.4% during 2024, which the firm said was possible due to “the benefits of our increased scale”.
In terms of the acquisition, some 0.3% of IW&W clients declined to migrate to Rathbones, while the firm expects to migrate “almost all” of the 55,000 clients across to the new enlarged business by the end of H1 this year.
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Last year also saw the completed integration of financial planning firm Saunderson House, a deal which was first struck in 2021.
Paul Stockton, group chief executive, said: “2024 has been a very exciting year for the group as we began in earnest to bring Rathbones and IW&I together as one combined business committed to helping our clients achieve their longer-term financial goals.
“In an eventful year, we attracted record gross inflows by leveraging our enlarged platform, grew underlying operating margin, exceeded the 2024 synergy targets we set out for the IW&I combination, and increased our dividend by 6.9%.”
He added Rathbones “continued to improve [its] services and investment processes” throughout the year, “taking advantage of the best that the Rathbones and IW&I teams have to offer”.
“The combination creates some significant future growth opportunities and provides a pathway to greater innovation as ideas are shared and acted upon. I am grateful for the efforts of all teams around the group who have helped us start 2025 in such a strong position.”
Growth plans
Alongside onboarding IW&I, Rathbones took “significant steps” towards improving organic growth last year, according to the firm. Looking ahead, the business has plans to strengthen its marketing and distribution capabilities, to “deliver more advice-led conversations”, introduce new services that will improve client choice, and focus on continuing to grow Rathbones Asset Management.
Rathbones aims to increase its underlying operating margin to 30% from September 2026. It aims to do so through a combination of “ongoing cost discipline”, a return to organic net inflows – which it said will be bolstered by its aforementioned growth plans – and “modest market growth in-line with inflation”.
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“We expect the improvement in the underlying operating margin to arise mostly during 2026, with a more modest improvement in 2025,” the firm stated. “This principally reflects the timing of further synergy benefits, which will be weighted towards the second half of the 2025 financial year, when the cost savings which are linked to the migration to a single operating platform will materialise and we work towards IW&I ceasing to run as a separate, regulated entity.
“Performance in 2025 will also reflect the increase in NIC costs [net interest costs] and a full year of the 2024 salary reviews, which were undertaken in the higher inflationary environment.
“We also expect to see a flatter seasonal spike in transaction-based commission income in March 2025 as a result of the additional activity that arose on client portfolios ahead of the 2024 Autumn Budget.”
This story was written by our sister title, Portfolio Adviser
