IG Group reports revenue was ahead in all regions except the UK; Q3 Trading Update
IG Group (“IG”, “the Company”), a global leader in online trading, today issues the following Trading Update for the three months to 28 February 2017, the third quarter of its 2017 financial year. The trends and figures highlighted below refer to this period and the corresponding period last year.
IG performed well in a quiet period in global financial markets. Revenue, at £117.4 million, was 3.8% down on what was the strongest quarter of the prior year. Active client numbers were ahead by 13%, driven by ongoing success in online marketing, with new first trades in the period over 20% higher than the prior year. Revenue per client was down by 15%, with current clients trading less often in the quiet period and the continued growth in the non-leveraged business and Nadex, where average revenue per client is significantly lower.
Revenue and other key performance indicators by region are as follows:
Revenue was ahead in all regions except the UK, with a strong performance in the Rest of the World driven by good growth in the US, Dubai and South Africa. Revenue in the UK was behind by 15%, with the prior year performance being particularly strong. More mature markets tend to outperform in more volatile periods as the large installed client base reactivates, as happened in the prior year, and underperform in quieter conditions.
IG’s stockbroking business continued to grow well in the period in both the UK and Australia, with just over 16,000 clients holding a position at the end of February. To extend its unleveraged offering, IG expects to launch its discretionary managed smart portfolio ETF service in the UK during the fourth quarter.
Regulation
The regulatory backdrop for leveraged trading in a number of countries remains uncertain. IG has always sought, and will always seek, to operate to the highest regulatory standards. In order to ensure fair client outcomes, strong, proportionate regulation, applied consistently, is essential in this industry. Over the last few months, IG has responded to regulator consultations in the UK and Germany and worked closely with the regulator in Dubai. IG was pleased by the clarity provided in France, which means that the Limited Risk Account the Company offers there is entirely compliant with the new legislation. IG is also now working on its responses to consultations in The Netherlands and Ireland. As clarity is provided on the conclusions of outstanding regulatory consultations, the Company will update the market as appropriate.
Outlook
Following a quiet third quarter in financial markets, the fourth quarter has started better for IG, although it is impossible to predict the market conditions for the rest of the year or to draw precise conclusions at this stage. As the Company enters this final quarter, none of the announced regulatory changes has yet had any impact, client recruitment remains strong and the underlying business is performing well.
Source: IG Group
