XTB’s Q3 Financials See Sizable Decline in Profits and Metrics

XTB, a recently listed brokerage on the Warsaw Stock Exchange Stock Exchange A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin Read this Term (WSE), has reported its financial results for the first nine months of 2016, which indicated a pullback across a number of measures YoY, due in large part to diminished Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Traders Read this Term, per a company disclosure.

The latest results follow on the heels of a mixed Q2 that despite a healthy account growth saw XTB’s profits retreating. YTD, XTB disclosed a number of key measures in Q3 2016, which were characterized as a step back from the year prior. In particular, total operating income for the first nine months of the year declined to $38.2 million (PLN 156.7 million), relative to $55.0 million (PLN 225.2 million) for the first nine months of 2015, or -30.5% YoY.

In addition, YTD XTB’s profit on operating activities also saw a sizable retreat to $6.6 million (PLN 27.0 million), which was reflective of a decline of -78.5% YoY from $30.7 million (PLN 125.6 million) as of Q3 2015. Overall, XTB’s net profit YTD came in at $6.7 million (PLN 27.3 million), compared to $25.0 million (PLN 102.5 million) for the first nine months of 2015, or -73.4% YoY.

XTB also yielded a pullback in its net profit and diluted net profit per share attributable to shareholders (in PLN/EUR per share), coming in at 0.23 for the first nine months of 2016, vs. 0.87 over the same interval in 2015, or -73.5% YoY.

Instrument Analysis

Looking beyond its financials, XTB also saw a mixed performance of its operations for the first nine months of 2016. More specifically, contracts-for-difference (CFD) totaled just $10.5 million (PLN 42.9 million) YTD, down from $23.3 million (PLN 95.2 million) for the first nine months of 2015, or -54.9%.

Overall, the decrease in income on XTB’s financial instruments over a nine-month period of 2016 was instigated in part by lower volatility in the financial markets relative to 2015 – last year had also seen a highly dynamic market, caused in part by a flash crash in China, which dictated volatility over all other markets.

XTB’s stock price (WSE:XTB) is trading down -0.75% today, falling to $1.96 (PLN 7.95) per share in European trading.