Sequoia reports ‘highest net organic growth’ in adviser numbers

The firm plans to grow its number of advisers further in order to improve its future financial performance, after revealing this week that it posted net profit after tax growth of 4,317 per cent to $27.8 million in the first half of financial year 2024.

The profit growth was driven by the sale of 80 per cent of Morrison Securities, which also boosted the firm’s revenue by 43.7 per cent to $62.8 million.

Sequoia’s licensees services division achieved the highest net organic growth in adviser numbers in CY23, alongside “top line” revenue growth over 50 per cent.

Commenting on its adviser growth, Sequoia’s managing director Garry Crole said: “We’re winning”.

“There’s been a lot of movement in the industry from groups like Insignia and AMP… a lot of advisers are looking for a home, Sequoia and InterPrac have been a real tortoise in the industry. We’ve been very stable. We were the number one licensee in the country in respect to net growth.”

Sequoia declared a fully franked interim dividend of 2 cents per share, up 186 per cent.

The firm expects strong second half revenue too on the back of the acquisitions of Castle Corporation and Australian Business Structures.

“Sequoia’s financial statements demonstrate the company’s unwavering commitment to providing value to its shareholders while also ensuring financial stability and sustainable growth. The company maintains a strong balance sheet, with $23 million in cash and liquid investments,” the firm said.

Looking forward, the firm reaffirmed its revenue target of around $130 million, with normalised EBITDA expected to be in the range of $8.1 million to $10 million.

“These outcomes can be achieved off the back of strong tailwinds, notably in 2H24 from the licensees services and professional services divisions. An improved return is also expected from our resurgent equity markets and direct investment divisions following restructures within these business units,” the firm said.

In November last year, Sequoia announced plans to grow its adviser numbers within InterPrac and Sequoia Wealth Management to 500 by 2026, adding that it plans to acquire adviser licensing services from sub-scale AFSL providers.

The firm noted that only 40 of the 1,876 AFSL holders have more than 100 advisers, leaving a large cohort to target for acquisition. Looking at its FY24 target, Sequoia said it was aiming for 15 per cent growth in advisers numbers, which would take its total to 380 by the end of the financial year.