XTB’s H1 Report Confirms Stronger Metrics, Institutional Business Rises

CFD revenues per lot increased 10 percent as marketing costs were reduced materially.

XTB has posted its full half-year report for the six months that ended on June 30th 2017. The company posted a sharp increase in profitability with earnings before interest, taxes, depreciation, and amortization (EBITDA) totalling $8.1 million (PLN 29.4 million), a rise of 160 percent. The report expands on the company’s preliminary figures published in July.

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Revenues rose as net deposits, active accounts and CFD profitability per lot increased materially. XTB’s operating income came in at $34.6 million (PLN 125.2 million), which is higher by 10 percent year-on-year. Active accounts also increased 10 percent to 20,016, while the company marked a profitability figure that totals of $33 (PLN 119) per lot on CFDs.

Trading volumes remained flat with the number coming in at just above 1.05 million lots. The potential for future growth is solid with net deposits marking a substantial increase of 58 percent to $60 million (PLN 216 million).

Marketing costs of XTB were cut materially from a year ago to less than $4 million (PLN 13.7 million), when compared to PLN 32.3 million last year. Expenses were reduced by a total of $6.3 million for the first half of the year.

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The second quarter was materially stronger than the first, with the broker’s total operating income rising to $18.4 million (PLN 66.5 million) which is more than double last year’s numbers. This number is reported by the company despite declining volumes quarter on quarter when compared to Q1 2017.

XTB’s EBITDA margin was 44.5 percent, which is materially higher than last year’s 18.8 percent. Net profit margins increased more modestly to 23.4 percent when compared to 20.2 percent last year.

Institutional Profitability Surpasses Retail

XTB has posted an outlier in terms of statistics for companies that have both institutional and retail segments. The company’s profitability per lot has been higher in the institutional segment at $49 (PLN 177) per lot, when compared to $31 (PLN 112) per lot in the retail segment.

While the share of revenues from the institutional segment was below 20 percent, at $5.5 million (PLN 20.1 million) per lot, the operating profit share totaled 33.8 percent.

Index CFDs Revenues Lead with FX Playing Catch Up

XTB Reports a total of 50.5 percent of revenues being generated by index CFDs with FX in second spot with 31.9 percent which is up from 24.4 percent last year. Trading interest in equity CFDs increased by 233.3 percent year-on-year, albeit starting from a very low base of 0.6 million in revenues.

Central and Eastern Europe revenues have increased by 6.8 percent year-on-year with Western Europe being the main driver with growth totalling 14.7 percent. Latin America and Turkey have declined 5.9 percent. All in all, Western Europe accounted for 53.5 percent of total revenues of XTB.

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