SJP reduces advice fees to 110m

SJP reduces advice fees to 110m - advice fees — SJP reduces advice fees to 110m

St James’s Place has reduced its provision for its historic ongoing-service evidence review to £110m as it approaches the final stages of the exercise.

The wealth manager released £110.4m from the provision during the first half of 2026 and used a further £55.5m to meet costs associated with the review. The remaining provision stood at £272.3m at the end of 2025.

SJP expects to complete the review during 2026 and will return the £82.8m post-tax value of the provision release to shareholders through an additional share buyback.

The exercise covers clients charged for ongoing advice services from the start of 2018 where evidence that the service had been delivered fell below SJP’s acceptable standard.

Progress during the half-year allowed SJP to move from calculating the provision by extrapolating sample data to assessing cases individually, substantially reducing the judgement and uncertainty involved.

The release helped IFRS profit after tax rise from £279.5m to £310.8m during the six months to 30 June.

Adjusted IFRS profit before tax, which excludes the provision release, fell 9% from £307m to £278.4m as the company continued its transition to the charging structure introduced in August 2025.

SJP attributed the decline to lower initial and ongoing margins under the new model.

This was partly offset by growth in average funds under management and the absence of charging-structure implementation costs incurred last year.

Net inflows slowed to £2.7bn from £3.8bn during the corresponding period of 2025, despite gross inflows remaining unchanged at £10.5bn.

Pensions generated £1.79bn of net inflows, while unit trusts, Isas and discretionary fund management attracted £980m.

Investment bonds recorded £30m of net outflows.

Client retention edged up from 95.3% to 95.4%.

Positive net inflows and investment performance helped lift funds under management from £220bn at the end of 2025 to a record £240.8bn.

Investment returns after charges represented an annualised 16.4% of opening funds under management.

SJP’s client base grew by a net 27,000 during the half-year, while its adviser population increased by 17 to 4,951.

Chief executive Mark FitzPatrick said competition for experienced, professional advisers remains strong as the advice market continues to evolve.

The company has completed a review of adviser pay and benefits, introducing a simpler framework that more closely aligns rewards with the delivery of high-quality, holistic advice.

The changes were funded through cost savings elsewhere in the business.

The group remains on track to remove £100m of annual costs from its addressable cost base by 2027.

It expects to reinvest approximately half of those savings through to 2030, creating around £260m to support its next stage of growth.

SJP completed a review of its technology strategy through to 2030 during the half-year.

Its priorities include making the company easier to deal with, creating a more efficient and scalable organisation and strengthening its data foundations.

Artificial intelligence is already being used through tools including Advice Assistant, ChatSJP and SOFI to improve productivity and the experience of advisers and clients.

Mark FitzPatrick said AI will enhance advice rather than replace it.