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October 30, 2013 at 09:03 AM
LPL Financial (LPLA) beat analysts’ estimates with net revenue of $1.053 billion for the third quarter of 2013, up 16% from a year ago.
This included a 19% jump in commission revenue and a nearly 12% improvement in advisory revenue. Recurring revenue represented 64% of total sales in the period, LPL says.
Net income rose about 10% year over year to $37.6 million, or $0.36 a share, from $34.3 million, or $0.31 a share, last year.
“Advisor productivity continues to be strong and points in a positive direction moving into the fourth quarter across our advisory and brokerage businesses,” said CFO Dan Arnold, in an interview with ThinkAdvisor.
On the advisory side, net new assets were up 11% or $4 billion in the third quarter. “This shows our great strength in attracting assets across both our hybrid RIA and corporate RIA programs,” Arnold said.
On the brokerage side, average advisor commisions improved to $156,000 in the third quarter from $152,000 in the second quarter, “which bucked the trend of a summer slowdown mainly due to third-quarter sales of alternative products,” the CFO said.
“Our unique offering around the hybrid RIA option continues to be attractive as we recruit new advisors and are seeing good, consistent asset growth,” Arnold explained. “Also, [advisors across the board] are using more of our advisory solutions,” such as the Model Wealth Portfolios and Strategic Asset Management platform.
