Wilsons’ growth drive targets boutiques, adviser hiring to double advice funds

The wealth and broking group’s CEO Brad Gale hopes to spearhead a round of consolidation in the private wealth industry, as he targets a doubling of funds under advice.

Wilsons chief executive Brad Gale, right, and head of private wealth Casimir Skillecorn. Picture: Chris Pavlich

Wilsons Advisory chief executive Brad Gale hopes to spearhead a round of consolidation in the private wealth industry, as he targets a doubling of funds under advice and beds down the purchase of Sydney-based Statton Partners.

Mr Gale shrugged off suggestions the financial advice and private wealth model was broken in Australia, noting the superannuation pool was expected to grow to $9 trillion by 2041.

“We really like the backdrop of financial markets in Australia, we think the capital pool is going to continue to grow,” he said in an interview. “We think the outlook for financial markets and clients needing advice is attractive.”

Mr Gale noted there were more than 2000 licensees in the Australian market and said many boutique wealth firms may find it difficult to fund the operating infrastructure required to provide customers with ample investment choice, while also keeping up to date on technology and regulatory requirements.

“The operating structure that you need to deliver a really good outcome for your people and your clients is expensive … For the good firms that are culturally aligned to us, we think Wilsons would be a great home for you to become partners with us in,” Mr Gale added. “We think in the marketplace there’s between 25 and 50 boutique organisations that we would really like to engage in opportunities.”

The transaction with Statton sees those transitioning to Wilsons moving to the latter’s Sydney offices in coming months. They include director Stuart Hudson, financial adviser Todd Payne, head of client services Dyan Comino and relationship associate Annabel White.

Wilsons did not disclose the funds under advice at Statton, founded in 1967.

The latest deal by Wilsons follows the acquisition in 2022 of Chancellor Portfolio Services, which was established as a family office in 1995 before branching out into a broader wealth business.

Wilsons’ private wealth boss Casimir Skillecorn noted the firm was also seeking to facilitate a “huge amount” of succession planning occurring within the sector.

“You’ve got the senior generation getting to a point where they are looking to take equity off the table or pass on to their younger staff, and that’s something that we think we can play a big part in, in providing a mechanism to allow that to happen efficiently,” he said.

Mr Gale’s growth plans come, however, after the number of financial advisers in Australia plummeted from 30,000 to about 15,000 in the past seven years, exacerbated by the findings of the 2018 Hayne royal commission and increased compliance and educational requirements. The sector is grappling with those dynamics and also more broadly the question of how to make financial advice more affordable to larger sections of the population.

Mr Skillecorn said Wilsons had an associate program that sought to attract young would-be financial advisers to its ranks.

Wilsons has more than 100 people in its private wealth division, out of a total staff of 170, spanning institutional research and equities, wealth and corporate finance.

“From a private wealth perspective our aspirations are to grow that team by 50 per cent,” Mr Gale said, noting he was targeting that over the next four years alongside a doubling of Wilsons’ $12bn in funds under advice.

“Our intention is to have the business last for another 125 years and … our philosophy might be slightly different to some others who may be setting themselves up for liquidity events or other corporate strategies.”

The domestic private wealth sector has experienced a deal-making frenzy led by international suitors in the past five years. Focus Financial Partners purchased a strategic stake in Escala, EFG International became a majority shareholder in Shaw and Partners and Crestone was acquired by a unit of the Princely family of Liechtenstein, LGT International. The stockbroking industry has separately endured continued margin pressure and rationalisation, including Canaccord Genuity acquiring Patersons Securities in 2019.

Listed company Wilson HTM Investment Group spun off its broker, which became Wilson HTM Securities and Advisory, in 2015. The listed entity then focused purely on funds management and is now called Pinnacle. That followed a turbulent period for the combined company.

Wilsons is now half-owned by staff via a partnership model, with the remainder held by New Zealand-based Craigs Investment Partners, which is wholly employee-owned after staff bought out Deutsche Bank’s stake.

Wilsons posted a $2m profit from continuing operations for the 12 months ended June 30, 2023, down from a $3.9m result the prior fiscal year, the latest accounts lodged with the corporate regulator show. Wealth management income was the biggest contributor to revenue, followed by brokerage and corporate finance respectively, given weaker deal and capital markets activity during that period.

Mr Gale said fiscal 2023 was “not as profitable” as the firm would have liked, largely because it opted to reinvest in Wilsons’ operations and continue its hiring drive.

He outlined that Wilsons’ unaudited fiscal 2024 accounts showed revenue at about $75m, while profit from continuing operations was $5.5m. The firm expects revenue to climb to $86m and profit to rise to $8.7m in this fiscal year.

Wilson’s corporate finance arm this year was a co-lead manager on the float of Guzman y Gomez and also worked on a raising for device and surgical education group IMRA.

Wilsons’ counts 58 partners among its ranks after new admissions including head of advice Matthew Nicholls, senior sales trader Joe Zhang, research analyst Tom Camilleri and adviser Charlie Sayers.