IG Group Initiates Second Tranche of £150 Million Share Buyback
Trading Point UK, the FCA-regulated entity behind brokerage brands like XM and Trading.com, has released its operational results for 2023. While revenue experienced a substantial increase, rising costs kept the company from achieving profitability, though it did manage to reduce its net loss to £844,000.
Trading Point UK Reports Higher Revenue Amid Ongoing Losses
According to the latest filings with UK Companies House, Trading Point of Financial Instruments UK Limited reported revenue of £1.4 million for 2023, marking a 40% increase from £1.1 million in the previous year. However, costs also escalated, totaling nearly £2.3 million, leading to a final net loss of £844,000, a 20% improvement compared to the £1.09 million loss reported in 2022.
On a brighter note, the company's net asset position rose to £2 million from £1.4 million in 2022, primarily due to a share capital increase in February 2023.
“The share issue consisted of 1,500,000 fully paid ordinary shares of £1 nominal value each,” the report stated. “The available cash reserves indicate the company's capacity to meet its obligations and cover capital requirements.”
As the deadline for financial statement submissions approaches in the UK, many brokers have recently released their reports. Notably, Citadel Securities reported a 35% profit increase across its two British subsidiaries, while Capital.com UK faced challenges with rising costs, which led to a 60% drop in profits, down to $1.5 million from $4.1 million in 2022. LandFX also reported a nearly 30% decline in turnover and gross profit, but managed to increase its net profit to £55,000, up from £46,500 the previous year.
Trive South Africa has officially started onboarding clients for derivatives trading, marking its entry into the competitive African financial market. Operating under a license from the Financial Sector Conduct Authority (FSCA), the broker is led by Marius Grobler, who previously served as Trive’s COO for the MENA region.
Launching Derivatives Trading with Local Features
In addition to offering MetaTrader 4 and 5 platforms, Trive South Africa plans to introduce a copy trading feature called Trive Social and is developing its own proprietary trading platform. Grobler expressed the company's ambition to become “the premier choice for derivatives trading” in the region, supported by strategic partnerships like the one with Finalto SA, which serves as their Over-the-Counter Derivative Provider.
This partnership, established in mid-July, enhances Trive’s trading ecosystem and liquidity solutions. The broker offers ZAR-denominated trading accounts with leverage of up to 1000:1, integrating multiple local payment service providers.
A Growing Retail Trading Market
The brokerage industry in South Africa has seen rapid development recently, with several companies, including CFI, obtaining operational licenses. New entrant Prime Quotes, founded by former Admirals and Alpari Board Member Bartosz Bielec, has also entered the market. XTB has been expanding its offerings in Africa following success in Europe and South America.
Additionally, Finalto has launched a new White Label solution aimed at streamlining market entry for brokers, providing access to top-tier liquidity to help new firms distinguish themselves in the competitive landscape.
IG Group Holdings plc (LSE: IGG) announced today the launch of the second phase of its £150 million share buyback program, managed by UBS AG London Branch. This tranche involves repurchasing up to £75 million in shares and is expected to be completed by January 31, 2025.
Details of the Share Buyback
The second tranche follows the successful execution of the first £75 million phase, which began in August under the management of Morgan Stanley & Co. International Plc. Shareholder approval from IG Group's annual general meeting on September 18, 2024, allows the company to repurchase up to 36,934,031 shares during this round. The primary goal of this initiative is to reduce share capital, with all repurchased shares to be held in treasury.
Financial Context and Future Outlook
This buyback comes after IG Group reported some challenges in its fiscal year 2024, including an 11% drop in pre-tax profit to £400.8 million and a 3% decline in total annual revenue to £987.3 million. CEO Breon Corcoran acknowledged the need for change within the company, stating, “We have lots of work to do to take IG to the next level and address the challenges we face.”
However, the company's outlook improved in Q1 of fiscal 2025, with total revenue reaching £278.9 million—a 15% increase year-over-year. This growth was driven by higher revenue per client and increased volatility across various asset classes. Revenue from over-the-counter (OTC) derivatives rose by 14% to £208.1 million, while exchange-traded derivatives revenue jumped by 20% to £59.6 million.
In other developments, IG Group has discontinued Daily FX, its trading news and forex analysis platform, redirecting users to the main site, and launched the new “Trade Live with IG” morning show.
SquaredFinancial has announced the hiring of esteemed market analyst Renato Campos, marking a significant step in its expansion efforts in Latin America. This move aligns with the firm's commitment to providing high-quality education and expertise in the financial sector.
Campos's Expertise and Contributions
Bringing over 11 years of experience in equities, currencies, and commodities, Campos specializes in financial derivatives and market analysis. He is recognized for his ability to distill complex market dynamics into actionable strategies and frequently appears on major financial platforms, including CNN Chile and Bloomberg. At SquaredFinancial, he will provide clients with daily market analyses, webinars, and podcasts in the local language, enhancing their ability to navigate market movements confidently.
Leadership Remarks
Philippe Ghanem, Founder and CEO of SquaredFinancial, expressed enthusiasm about Campos's addition, emphasizing the company's dedication to extending expertise and improving service quality for global investors. Campos himself shared excitement about joining the firm during this pivotal growth phase, reaffirming his commitment to empowering traders in Latin America.
About SquaredFinancial
Founded in 2005, SquaredFinancial is a regulated FinTech firm aimed at becoming a comprehensive solution for investors' financial needs. With nearly two decades of experience, the company leverages advanced technology to offer an intuitive trading platform, catering to a diverse clientele looking for sophisticated investment opportunities.
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