xtb reports a drop in the Group revenues for the 3Q 2016 

The Management Board of X-Trade Brokers Dom Maklerski S.A. (xtb) has issued a press release to publish its preliminary financial and operating results for the Q3 of 2016.

Management Board commentary on the preliminary results

Third quarter of 2016, analogously to the second quarter, has not been influenced by unexpected and extraordinary market events or strong long-term trends. Noticeably lower volatility on the markets recorded in 9 months of 2016 as compared to 2015 has created fewer investments opportunities for XTB clients. As a consequence, XTB as well as its competitors with the same business profile, experienced decrease in turnover of financial instruments and hence a drop in the Group revenues.

Operating costs in the third quarter of 2016 decreased by 37% (i.e. PLN 20 million) comparing to the previous quarter of the current year, mainly due to lower marketing and other external services costs.

In the second quarter of 2016 the Group recorded increased marketing spending related to the global branding campaign. The Group perceives such spending as an investment that should bring effects in the long-term period.
In the third quarter Group’s marketing activities connected to the above-mentioned campaign were limited, mainly due to the holiday period of the year. As a result, marketing spending reached PLN 8 million for the third quarter and returned to the comparable level as for the first quarter of 2016. Total operating expenses for the third quarter 2016 reached similar level as for the comparative period of 2015.

In the second quarter of 2016 the Company recorded costs connected with the public offering of the Company’s Offer Shares. Third quarter was not affected by similar costs which resulted in a decrease of other external services by 37% (PLN 2.6 million) q/q.

In spite of the limited market volatility observed during the current year (which resulted in lower average operating income per active account), XTB consequently builds up clients base for future growth. The number of new accounts and average number of active accounts is growing in the subsequent quarters of 2016.

In the third quarter of the year the number of new accounts increased by 20% y/y and average number of active accounts increased by 10% y/y. The Management Board believes that increasing number of new and active accounts and a strong brand in combination with more favorably market volatility are solid foundations for future growth.

The Issuer informs also that the final financial and operation results for the III quarter of 2016 will be submitted in the extended consolidated report of the Issuer’s Group for the III quarter of 2016, publication of which was planned for 14 November 2016.

Source: xtb – Information on the preliminary financial and operating results for the III quarter of 2016 

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