IG Group Holdings plc First Quarter Trading Update (2602K)
September 20 2016 - 2:01AM
UK Regulatory
TIDMIGG
RNS Number : 2602K
IG Group Holdings plc
20 September 2016
20 September 2016
IG GROUP HOLDINGS PLC
First Quarter Trading Update
IG Group ("IG", "the Company"), a global leader in online
trading, today issues the following Trading Update for the three
months to 31 August 2016, the first quarter of its 2017 financial
year. The trends and figures highlighted below refer to this period
and the corresponding period last year.
IG performed relatively well in what was a challenging quarter.
Revenue, at GBP111.4 million, was 5.1% ahead of a strong first
quarter in the prior year. As announced on 24 June 2016, IG
increased client margin requirements approaching and during the
volatile period surrounding the UK's EU referendum in order to
preserve long term relationships and value; this had the effect of
constraining client trading during this time. Financial markets
through July and August became increasingly subdued and presented
limited trading opportunities for both current and new clients.
Revenue and key performance indicators by region are as
follows:
Geographical
Revenue Q1 Revenue KPIs
--------------- ------------------------ -------------------------
FY17 FY16 %
--------------- ----------- ------------
Change
Change in revenue
in active per
GBPm GBPm Change clients client
--------------- ------ ------ -------- ----------- ------------
UK & Ireland 55.4 56.4 (1.8%) 24% (21%)
Europe 23.4 20.8 13% 18% (4.5%)
Australia 16.2 14.9 9% 1.5% 7.4%
Rest of World 16.4 13.9 18% 15% 2.0%
------ ------ --------
Total 111.4 106.0 5.1% 18% (11%)
--------------- ------ ------ -------- ----------- ------------
Note: Revenue has been rounded to one decimal place. All
percentage movements in the table above have been calculated using
the unrounded data and movements of 10% or more have been rounded
to the nearest percentage point.
Revenue was ahead in all regions except the UK, where the impact
of the management actions in the period surrounding the EU
referendum and the subsequent dull markets was felt most. Supported
by increased effective marketing spend, the level of new client
first trades was very strong. At a Group level, this metric was
ahead of the prior year period by 70%, reaching a new record level,
with increases in every region, and ahead of the final quarter of
last year by around 30%. Unsurprisingly, the increase in the number
of new clients was once again most marked in the UK and in late
June. A high number of new clients beginning part way through the
period, combined with the quieter end to the quarter and the
ongoing growth of the stockbroking business, resulted in the lower
average revenue per client in the UK.
In line with IG's stated aim of improving client retention, the
company introduced the Limited Risk Account in July and has since
rolled this out across the global business. This an important step
in helping some clients to manage better the risk/reward balance in
their trading by guaranteeing they can never incur a debt with IG.
Also in July, following recent encouraging progress in the UK, the
company further progressed its aim of diversifying its product
suite by extending its stockbroking offering to Australia.
Looking forward, IG has a clear strategy to deliver future
growth and will continue to execute against the priorities that
underpin it.
Today there will be a conference call for analysts and investors
at 8.30am (UK time). The call can be accessed by dialling +44 20
3059 8125. The audio recording of the conference call will be
archived for access at www.iggroup.com/investors, along with a full
transcript.
The next planned performance announcement from IG is a short
pre-close trading update, currently scheduled for 30 November
2016.
For further information, please contact:
IG Group
Kieran McKinney
Head of Investor Relations 020 7573 0026
FTI Consulting
Neil Doyle / Ed Berry 020 3727 1141 / 1046
About IG
IG is a global leader in online trading, providing fast and
flexible access to over 10,000 financial markets - including
shares, indices, forex, commodities and binaries.
Established in 1974 as the world's first financial spread
betting firm, IG's aim is to become the default choice for active
traders globally. It is an award-winning multi-platform trading
company, the world's No.1 provider of CFDs* and a global leader in
forex, and it now offers an execution-only stockbroking service in
the UK, Australia, Ireland, Germany, Austria and the
Netherlands.
It is a member of the FTSE 250, with offices across Europe,
Africa, Asia-Pacific, the Middle East and the US, where it offers
limited risk derivatives contracts via the Nadex brand.
*Based on revenue excluding FX, from published financial
statements, September 2015.
(1)References in this statement to "revenue" refer to net
trading revenue, which is trading revenue excluding interest on
segregated client funds and is net of introducing broker
commissions.
(2) References in this statement to active clients are to the
number of clients trading during the period referred to and
references to average revenue per client are to revenue for the
period referred to divided by the number of active clients in that
period.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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