Hi, I'm Danni Hewson, financial analyst at AJ Bell. Thank you so much for joining us for our 2022 interim results video. We're shortly gonna hear from Andy Bell and Michael Summersgill, CEO and Deputy CEO of AJ Bell. First, let's go through some of the key numbers from the first half. Let's start with customers. As reported in our Q2 trading update back in April, AJ Bell's total customer numbers increased to over 418,000 at the end of March. This is an increase of 21% over the last 12 months, with the growth being driven by the company's platform business. Assets Under Administration, or AUA, closed the period at GBP 74.1 billion, up 13% compared to the same period last year.
Total net inflows were GBP 2.8 billion, with the platform business again being the key driver of AUA growth. Moving on to the first half results announced today. Revenue was up 2% to GBP 75.5 million. This was lower than the year-on-year growth in customers and assets under administration due to a 3.7 basis points reduction in revenue margin to 20.3 basis points. This reduced revenue margin was in line with expectation and follows the moderation of dealing activity in the second half of 2021, as well as a lower average interest rate earned on cash in the period compared to the first half of the prior financial year. Following recent interest rate rises, management are now guiding to an improved revenue margin over the course of the full year, something Michael's gonna talk about in more detail later.
Profit before tax for the period was GBP 26.1 million. The lower revenue margin, coupled with the investment in new propositions signaled in the 2021 annual results in December, saw a 17% fall in profit before tax compared to the previous year. You'll shortly hear more about these new propositions, including Dodl by AJ Bell, which launched in April. The profit before tax margin was 34.6%, which was ahead of the 32%-33% range provided by management in their previous guidance for full year 2022. Management are now providing a guide to a profit before tax margin for the full year of around 35%, with a further improvement anticipated in full year 2023. Diluted earnings per share fell 19% to GBP 0.0508 per share, reflecting the lower profit in the period, as previously discussed.
Let's end with dividends. The board has declared an interim dividend of GBP 0.0278 per share. This equates to 40% of last year's total ordinary dividend, in line with the company's stated dividend policy. You can find full details about these results on our website. Now let's hear from Andy and Michael and get an insight into what's behind these numbers and also their expectations for the full financial year and beyond.
The first half results have been really pleasing. Most importantly, the engine room of the business, which is the customer numbers and the assets, have grown. From that, the long-term financial performance will ultimately follow. Yeah, there's been a large number of new customers have come onto the platform in the half year. Been very pleased with both the quality, in terms of the average AUA they've brought in, and also the fact that they've predominantly been in tax wrappers, so either pensions or ISAs. We've seen, particularly in the run-up to the year end, we've seen the net inflows be really strong. In our results in December, we announced that we were gonna launch Dodl by AJ Bell. That was launched in April.
For those not familiar with it's an app-only investment proposition, really aimed at those who are new to investing. You know, we're very excited about the potential for that in the future.
I'm still very positive about the platform market in spite of the tough macroeconomic environment. There's a long list of reasons, to be honest, but the main thing for me is the continuing growth of the industry. In the time that I've been in the business, the platform market's grown at about 10%-15% per annum, and that's true in both the advised and the D2C subsectors of the platform market. I think that growth will continue, and the main reason is the real drivers of that growth have been these big structural factors. Things like demographics. People are living for longer, and they're having to work for longer to save for their retirement, and that increases the need and increases the opportunity for investment platforms.
You've got other factors like labor market mobility has increased, so people are moving around between employers more frequently. That fragments their pension savings, so that consolidation piece becomes very attractive later on in their working life. All those factors are as powerful now as they have been at any time I've been in the business. I think the growth in the industry will carry on despite the tough environment. Inflation will definitely have an impact on inflows into the platform market, but not as much as you might think. The main reason for that is that there's a lot of money in the financial system that's not currently on platforms that could be.
So, to talk through the numbers, there's about GBP 1 trillion of assets on investment platforms in the U.K., but there's about GBP 2 trillion that could be. It's in similar products in adjacent markets, but it's not actually within the platform industry. I mean, it's an industry of big numbers, I know, but GBP 2 trillion, that's a huge opportunity there for platforms to go at, and they're not reliant on their existing customers contributing to access that growth. That's one of the reasons that I think that actually the platform market will weather the inflationary storm better than most industries. The way that we approach the market is slightly different to most of our competitors. Most of our competitors are either a D2C platform or an advised platform.
We actually serve both, so we see them as distribution channels. We have dedicated propositions, different brands, and a dedicated customer service team in those two different markets. Very quickly we pull things together into a single operating model behind the scenes. It's the same IT, it's the same operational teams that are overseeing the transactions that customers process on the platform, and that means that we can operate very efficiently in both markets. Very quickly, for me, the question becomes, why would you limit yourself? Why only operate in one market when you can operate in two? That's the way that we approach the market a little bit differently to most of our competitors, and I think that maximizes our growth opportunity.
When we're developing our propositions, we will focus on predominantly three things. One is price or value, two is the service, and three will be the ease of use and making sure it's a comprehensive proposition that is really suited to the target audience that we have. Both of our propositions, both advised and D2C have won awards in the half year, and it's really pleasing that we've grown our market share in both segments. You know, one of the benefits of having the dual channels both in advised and D2C is you get the economies of scale of having a single platform, but distributed in two separate markets.
Both of those markets are growing strongly, both double-digit growth is expected in the future and certainly being demonstrated in the past. I think in the moment, your cost of living is focused on everyone's mind. We are regarded as one of the best value platform providers in the U.K. We have taken this opportunity. We've always been a believer in ensuring our economies of scale with our customers, and we've taken this opportunity to announce with our interim results a further reduction in charges both on our advised platform and our D2C platform. I'm a big believer that, you know, charges or pricing will attract new customers, but it's actually service that keeps them with us for hopefully their full investing journey.
Our retention rates have increased now above 95% in the half year, which I think is testament to that approach. Brand awareness is key in an industry like ours. We have come on a journey since we IPO'd, and we're far better known now than we ever were. What brand does is help demonstrate our values in our business and ultimately trust is, you know, second to pricing. Trust is probably the other major factor on which people choose which platform to go with. Part of our spend on brand has been on a new TV advertising campaign, again, part of trying to get our name out there.
Really, the message is that, you know, we have a proposition for all types of customer, be they advised, be they investment hobbyists or just be they new to investing. Yeah, it's a very competitive labor market. There's no doubt. Like most businesses, we've had to transition through COVID. Our aim, as we've always focused on, is to attract and retain high caliber talent. We've now introduced a permanent hybrid working model, which I think is part of that approach to making sure we are an employer that people want to come and work for.
We've talked for a few years about the attractiveness of simplified propositions. We can now start to talk through that in more detail with Dodl because we've launched it. Everything I say applies equally to the advised market and to the Touch proposition that we're currently still building in that side of the market. I think the important thing for us to get across to people about Dodl is that it's been launched to supplement Youinvest. So Youinvest is seen rightly, I think, as one of the strongest propositions in the D2C platform market. It's the main focus of our growth in that part of the business, and we're gonna carry on investing in it and developing it to keep it at the forefront of the market.
What we've said for a few years now is that we think that the customers who are new to investing, that's a big enough market now, that it warrants its own proposition. That's what we're trying to do with Dodl, to have a very simple proposition that can better appeal to those customers without having to strip things away that the Youinvest customers value us having on that platform. It's still very early days for Dodl. It's only a month old, as a product. We're not drawing any firm conclusions at this stage. There are a few exciting and promising aspects to the data that we've been able to gather so far. One of the things that we're keen to do is to appeal to that broader audience, the new to investing customer.
We've seen that the vast majority of early accounts on Dodl have been from customers that are new to AJ Bell. This isn't about Youinvest customers transferring across. There's a positive sign that we've hit our marks there. The other thing that we're really trying to do was make sure that it was a really simple proposition, a really simple journey. If you look at what people are investing in, they're not coming to Dodl to invest in shares. They're generally all investing in either an AJ Bell fund or one of the themed investments that we've put together. Promising signs, but as I said, still early days, so we'll keep a close eye on it and see how it develops.
Looking at the impact of the cost of living challenges out there, I think it's impacted differently on the advised customers and our D2C customers. On the advised side, they are typically wealthier on average, slightly older, and hence, we haven't really seen any major impact in terms of activity. They've also the benefit of advisors who act as a fear filter. We broadly expect things to carry on in that part of the market. In terms of our D2C customers, they are typically younger in age, probably not as wealthy. There has been a small impact in the sense of slightly lower either contributions into pensions or subscriptions into ISAs.
We have also seen, as we've come out of COVID, we've seen a leveling off of dealing activity. Really, if you look at asset allocations through the period, they haven't really changed significantly. Maybe the one notable change has been a slight increase in investment into overseas shares. We're winning lots of customers. Partly, you know, COVID was that wake-up call that reminded people that they do need to look after their own personal finances, be they go to an advisor or do it themselves. I think the sort of customers that we attract are not really the day traders that we saw a flurry of last year. More people are looking to put together long-term, diversified investment portfolios and often within a tax wrapper.
Not always, you know, in the main, through a pension or an ISA. I would say to anyone who's looking to invest is just the golden rule is to have a diversified portfolio. Clearly, they should be using the tax allowances where possible. If you have a broad spread of assets, then if there's any bumps in the road, you'll be as well positioned for them as is possible.
We have seen a bit of a rollercoaster ride with revenue margins over the last two financial years. There's a very positive trajectory there now for the business, and the main reason for that is interest rates. That's not the only thing that's happened here. If you were to look at the revenue margins for both the advised and the D2C platform over the last financial year and this financial year, and say, break it down into six months, six monthly periods, you see a nice U- shape to the revenue margin on both sides of the business. The main reason that the uplift is there now is because of interest rates, but there are other things going on as well.
On the D2C side of the business, we don't get back to the sorts of revenue margins we were seeing in the first half of FY 2021 where it was over 40 basis points, and that's because trading was very high, but that has now come down to what we see as more normalized levels. It's an output of our very balanced revenue model, but there is now a very strong trajectory for revenue margins. I was concerned that we wouldn't see the benefit of rate rises. We treasury manage the money that customers place on the platform. Because of the type of depositor we are, there's sometimes not the greatest demand from banks for those deposits. That hasn't proven to be the case, which is pleasing.
We have seen the increase in rates transmit to us, and so that means we've been able to share that benefit with our customers in a number of ways. We're increasing the interest rates that they receive, we're reducing various charges that they pay, and that still leaves us in a position where we've got a stronger revenue margin going forward into the next financial year than we've had in the first half of this financial year. The decision to reduce the charges that our customers pay isn't a simple case of interest rates have gone up, so we're going to reduce the prices. There's a few things that give us the confidence to do that. You know, one, we've got a very balanced revenue model.
There are various different revenue streams that drive the revenue of the business, so we're not reliant on interest income. The second thing that gives us the confidence to reduce these charges is that we're scaling the business very effectively. As we grow the business, profit margins increase, and that gives us an opportunity to be more competitive by lowering charges to customers investing in the propositions. This is something that we're doing now. It's something we've done in the past, and it's something we might well do again in the future. I understand investors scrutinizing costs in the platform market at present. There is an awful lot going on that's impacting the cost base of businesses very differently. For AJ Bell specifically, we're looking to launch new products.
It's a fair question to say, "Okay, how much is that impacting your cost base?" If you look at our technology cost, which is one of the areas that shows through, total hasn't significantly impacted at all. If you were to take the costs of the development and the work that we're doing ahead of launch on the Touch proposition, if we adjust for that, costs have increased by 17% per annum. I think that the underlying increase in technology cost is very much in line with what you would expect for a growing platform business. Then the key one for me is the operational cost. That's what you can judge the effectiveness of how we're scaling the business by.
The underlying increase in operational costs if you allow for the different level of customer activity year-over-year is about 10%. You can see that compare that figure to the growth in the business, particularly in terms of the number of customers acquired. It's certainly a cost line that we've got a tight control of. Inflation will have an impact on numerous cost lines. We're no different to a lot of businesses there. The key lines of cost for us would be IT contracts. They do have an inflation provision in them, as you would expect. Then the key one is salaries. Salaries for our staff.
You know, we're a growing business, so we need to be able to attract and retain our staff through this period. We've got to find the right remuneration package to make sure that we're able to do that in an inflationary environment. The area that we are slightly different is that our profits do have an element of inflation protection because, of course, we have that interest income that we've already talked about. Yet we've got inflationary pressures. It will impact on cost, but profit margins importantly won't suffer as a result. I've got a hugely positive view of the outlook for AJ Bell. If you look at our position in the market, I mean, firstly, the market itself, I think will continue to grow over the next few years and beyond that. We're improving our competitiveness within a very attractive market.
We're bringing new products to market. We're reducing the prices that our customers pay. We're doing that while still strengthening our financial performance. If you look at it from a shareholder perspective, we're seeing profit margins increasing, we're seeing revenue margins increase as we look forward to next year. I think that's a very, very powerful combination. I think we've put ourselves in a position where we can really weather this inflationary storm very successfully, and keep a focus on what we need to invest in to make sure that we maximize our long-term growth opportunities. It's that combination that excites me and makes me think that AJ Bell's in a great position.
Scale is clearly important in our sector. You know, we have got a trust with our customers. We're a FTSE 250 business. We look after over GBP 70 billion of assets. We've got a sustainable and profitable business model. The structural growth drivers in the market that were very attractive back in 2018 when we came to market are as valid now as they were then.