CMC Markets released Final results for the year ended 31 March 2017; Reduction in profit before tax 

CMC Markets plc (“CMC”), a provider of online and mobile trading platform enabling clients to trade over 10,000 financial instruments, has issued today a press release to publish its final results for the year ended 31 March 2017.

According the release:

Notes:
Net operating income represents total revenue after commissions payable to introducing partners and betting levies
Active clients represents those individual clients who have traded with or held a CFD or spread bet positions with CMC Markets on at least one occasion during the financial year
Revenue per active client represents total trading revenue from CFD and spread bet active clients after deducting partner commissions and levies
Dividend per share paid or proposed relating to the financial year

Highlights

• Subdued commission and spread income as clients traded less often in quieter markets, with net operating income reducing by 5% to £160.8 million (2016: £169.4 million), resulting in a reduction in profit before tax of 9% to £48.5 million (2016: £53.4 million)
• Growth in client base with active clients up 5% to 60,082
• Maintaining strong balance sheet with regulatory total capital ratio of 30% and own funds of £183.4 million
• Significant progress made on all five strategic initiatives, including signing the largest transaction in CMC’s history with ANZ Bank in Australia
• Proposed final ordinary dividend of 5.95 pence, maintaining prior full year ordinary dividend of 8.93p
• Financial performance at the start of FY2018 improved on same period in FY2017 with cautious outlook

Regulatory change

• UK (FCA) consultation: thorough and detailed response provided, likely to lead to an improvement in industry practices and positions the Group well for the future
• German (BaFin) consultation: mandated introduction of “no additional payment obligation” accounts but did not mandate change to client margins. The Group already has platform functionality developed to meet requirements by 10 August 2017

Progress made on strategic initiatives

• Established markets: grew primary market share in UK and Australia and maintained market-leading position in Germany
• Geographic expansion: strong growth in our new and expanding offices in Poland and France
• Digital: 52% of the value of Next Generation client trades completed on mobile devices
• New products: rapid delivery of new products, such as Knock-Outs released in Germany, enabled by fully invested, modular, bespoke platform
• Institutional: significant growth with the value of client trades increasing 82%

Peter Cruddas, Chief Executive Officer of CMC Markets commented:
“Our first full year as a listed company has been one of progress as we have worked hard to position the Group for future growth. It is disappointing that reduced client activity impacted revenue performance for much of the year, but I am pleased that the strength of our platform, team and service proposition has continued to attract new, high quality clients and our existing clients are putting more money to work with us. We have continued to make excellent headway with our five strategic initiatives in 2017 and signed the biggest institutional transaction in our history, our partnership with ANZ Bank. Clearly regulatory change is likely to have some impact on the business but we believe we are well positioned to benefit from market share gains in the medium to long term, with our ability to adapt our leading proprietary technology and focus on client service and regulatory compliance supported by our financial strength.”

Source: CMC Markets 

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