IntegraFin Holdings' (LON:IHP) Upcoming Dividend: Bigger Than Last Year's

IntegraFin Holdings plc (LON:IHP), the operator of the 'Transact' investment platform, has reported a robust full-year financial performance, with funds under direction increasing by 17% to £64.1bn. The company's revenue rose by 7% to £144.9m, while underlying profit before tax grew by 12% to £70.6m. Despite the impact of the UK's increased corporation tax rate, earnings per share improved by 7%. The company declared a total dividend of 10.4p per share for the year, a modest increase from the 10.2p paid in 2023.

The company's investments in proprietary technology have enhanced the efficiency of its platform and improved client experience. IntegraFin has also announced targeted fee reductions, including lower pension wrapper fees and reduced charges for non-advised clients, which are expected to have an annualised cost of £3m. Administrative expenses are forecast to rise by 9% in 2025, partly due to a £2m one-off cost associated with relocating its London office. From 2026, cost increases are expected to moderate to low- to mid-single-digit percentages.



Despite the positive results and an upbeat outlook for client inflows, IntegraFin's shares dropped as much as 11% following the announcement. Analysts expressed concerns over potential revenue margin attrition stemming from the fee cuts. RBC Capital Markets noted that the changes could lead to slight downgrades to 2025 and 2026 consensus earnings estimates, although it acknowledged the company's strong flow outlook. Shore Capital observed that revised guidance, including adjustments for increased national insurance contributions, could result in a 2% reduction in estimated earnings per share for the 2026 financial year. Panmure Liberum suggested that the impact of fee reductions may already be priced into market expectations, given IntegraFin's history of customer-focused charge reductions.

In conclusion, IntegraFin Holdings has reported a strong financial performance and declared a modestly increased dividend for the year. Despite concerns over fee cuts and their potential impact on earnings, the company's investments in technology and growth prospects remain attractive. As the company continues to invest in its platform and adapt to changing market conditions, investors should monitor its progress and consider the potential for further dividend growth in the future.