In This Article:
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Net Operating Income: GBP177.4 million, up 45%.
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Profit Before Tax: GBP49.6 million with a margin of 28%.
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Earnings Per Share: 12.8p, up from a loss of 0.8p per share in H1 last year.
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Trading Net Revenue: GBP131 million, a 50% increase year-on-year.
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Revenue Per Client: GBP2,984, up 60% on H1 last year.
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Investing Net Revenue: GBP19.9 million, up 19% year-on-year.
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Assets Under Administration: Over GBP41 billion.
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Interest Income: Up 46% due to elevated global interest rates.
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Operating Costs: Just over GBP111 million, down 9% excluding variable remuneration.
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Capital Resources: GBP337 million, broadly unchanged.
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Total Available Liquidity: GBP443 million, with net available liquidity at GBP246.6 million.
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Forecast Effective Tax Rate: Anticipated to be 28% for the year.
Release Date: November 21, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Net operating income increased by 45% to GBP177 million, indicating strong financial performance.
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Profit before tax rose to GBP49.6 million with a significant year-on-year increase in profit margins.
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Successful partnerships with Revolut and ASB bank, expanding CMC Markets PLC's reach and client base.
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Technological innovations and product enhancements, including the launch of OTC options and spreadbet options in the UK.
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Strong growth in the B2B segment, contributing significantly to revenue and client trading activity.
Negative Points
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Despite strong financial performance, there is no material revenue yet from the Revolut partnership.
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The business faces challenges in maintaining growth momentum in the second half, with revenue guidance suggesting a potential slowdown.
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Increased variable remuneration costs, which could impact overall profitability.
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The shift towards B2B relationships makes it harder to model customer numbers and revenue per client accurately.
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Potential risks associated with expanding into new markets and maintaining partnerships, which require continuous investment and strategic focus.
Q & A Highlights
Q: Can you provide insights on the rollout of technology and partnerships, and any restrictions on building relationships in certain countries? Also, how should we think about capital requirements and shareholder returns as the business shifts towards B2B relationships? A: David Fineberg, Deputy CEO, explained that CMC Markets is not focused on one particular geography but is open to opportunities wherever they arise, with a focus on the Middle East as a potential area for growth. Peter Cruddas, CEO, added that the company has nearly 400 partnerships globally and is leveraging its technology to facilitate these relationships. Albert Soleiman, CFO, noted that the company has a strong capital position, is profitable, and has a healthy dividend policy, which supports both growth and shareholder returns.