CMC Markets (LON: CMCX) issued a trading update on Thursday, stating that it is now expecting the operating costs to be 5 percent higher than the annual guidance provided previously.
The brokerage group detailed that a combination of higher personnel and non-personnel costs has resulted in an increased operational cost. In addition, it includes higher professional fees and software costs associated with expansion projects, along with the impact of a weak British pound.
“The Group continues to focus on delivering a strong business performance for its financial year ending 31 March 2023,” the broker stated.
Additionally, CMC highlighted that its year-to-date net operating income came in line with the levels of the same period of the previous financial year. Furthermore, it witnessed robustness in the monthly active clients and client assets under administration across its leveraged and non-leveraged businesses, which are Australian stock broking activities.
“Progress towards new business growth across all platforms and geographies continues as planned, and all expansion initiatives are on track,” the broker added.
FY22 Revenue Was In Line
According to its financial year 2022 results posted earlier, CMC generated £281.9 million in revenue, which came in line with expectations. However, the annual profit dropped by 59 percent as the pre-tax figure came in at £92.1 million.
Now, CMC’s leveraged business generates most of the business, compared to the non-leveraged services. However, it is considering separating them into two entities. Though the board is still evaluating the merits of the move, this, according to CMC, would maximize shareholder value.
Meanwhile, CMC is buying back its ordinary shares from the open market, similar to IG Group and Plus500, under a £30 million share buyback program.
