The UK-based online brokerage CMC Markets, which transacts around $70bln in average monthly volumes from clients in over 80 countries, today announced H1 results for the first six months ending September 30, 2013. The report shows a 34% increase Year-over-Year (YoY), with net revenues reaching £62.2mln from April through September (first half of the company’s calendar year for 2013).
The company also announced that Earnings Before Income Tax Depreciation and Amortization (EBITDA) was £26.6mln YoY, up significantly by £12.5mln or 88% higher from £14.1mln reported for the 2012 period. This indicates a strong start for the first half of the year, and a recovery from what looked like a weak 2012 by comparison for the British company.
The reported metrics also contributed to strengthen the group’s balance sheet which has a capital ratio of 305% company funds of £95mln and minimal debt, according to the announcement.
Platform Driven Recovery
Furthermore, the growth during the 6-month period was attributed to the acquisition of high value clients as a result of the company’s competitive market position, and due to the success of the upgraded Next Generation Platform from earlier this year.
As part of the company’s global growth strategy, the platform was released across Italy, Spain, France, Sweden and Norway in September 2013. This adds to its existing locations where the FCA regulated broker maintains offices, specifically in the UK, Australia, Germany, Singapore, and New Zealand.
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Explaining uptake of the new platform, CMC Markets stated to Forex Magnates that among the features that are well-used are the client sentiment, automated execution, and pattern recognition tools.
Some of the additional key platform features include a pattern recognition scanner, boundary orders and advanced order-ticket functions, CMC Market insight, Reuters news, and an economic calendar powered by Dow Jones.
Peter Cruddas, the CEO of CMC Markets has made considerable changes since returning to his active role as the company’s leader amid a series of events, including the prescient forecast of growth anticipated from the major platform upgrade which followed. He may have won the plaudits of his clients and peers, especially if this growth can been sustained. The shift of CMC’s customers’ trading on the company’s mobile platform from other methods offered by CMC, was recently covered in detail by Forex Magnates. It appears that Mr. Cruddas remains bullish about both the prospects of the in-house built technology and company’s direction overall, as can be seen in his comment further below.
Commenting on the announcement, Mr. Cruddas said, “These are a solid set of results for the first-half, but no more than I expected when we developed our Next Generation platform. It has not only allowed us to deliver a compelling client front end – I believe the best in the industry – but also create massive efficiencies within the business. EBITDA margins for the first six months have been in excess of 40 per cent, and will improve as Next Generation gives us more scalability and attracts more clients with its unique features and speed of execution.”
Further, Mr. Cruddas added to the corporate statement, “In addition, I have to comment that I really enjoy being back at the helm and I am one- hundred percent focused on the business. When I returned as Chief Executive in January 2013, I had a clear plan on how the business should operate and what the internal structure should be. I have set about that plan, and these results are early indications that we are on track. There is still a lot of hard work to do, but I feel that we now have the management structure, the focus and the platform to push on and make this a big year. I feel these results are only the beginning.”
The company had previously indicated the possibility of working with selected technology partnerships in the future, although had full confidence in their ability to deliver to the demands of their retail audience and beyond. Whether the regained financial strength will lead to further in-house innovations of the firm’s product offerings, or a combination of 3rd party products and partnerships still remains to be determined.