The Switzerland-listed Compagnie Financière Tradition (SWX: CFT), which operates the Japanese retail foreign exchange (forex) trading platform Gaitame, has released its financial results for H1 2023. The firm reported significant growth, with an increase of 11.8% in revenue and an uptick of 41.9% in operating profit.

Compagnie Financière Tradition Reports H1 2023 Results

The firm reported revenue of CHF 552.4 million in H1 2023, compared to CHF 525.1 million in the same period last year. This significant increase was primarily due to Compagnie Financière Tradition's interdealer broking business (IDB), which grew 11.6% to CHF 534.0 million. Additionally, its online forex trading business for retail investors in Japan saw a notable rise of 18.7% to CHF 18.4 million.

The operating profit also witnessed a substantial increase. In H1 2023, it was CHF 74.0 million compared to CHF 56.0 million in H1 2022. This resulted in an operating margin of 13.4%, which is up from 10.7% in the previous year.

The parent company of Gaitame recently published its report for Q2 2023, in which it reported an adjusted revenue of CHF 261.9 million for the three months ending in June. This was a jump of 34%. For the entire year of 2022, the company achieved a net profit increase of 40.3% to CHF 89.1 million.

An Eye on Profitability

When it comes to net profit, the company reported a slight increase. Despite a financial expense of CHF 4.5 million, largely due to fluctuating exchange rates, the net profit stood at CHF 54.0 million, with a group’s share of CHF 51.0 million. This led to an increase of 10.5% in basic earnings per share, which reached CHF 6.93 million.

The firm has also managed to maintain a strong balance sheet. As of 30 June 2023, the consolidated equity was CHF 447.4 million, with a net cash balance of CHF 257.2 million, reflecting the company's focus on maintaining a strong capital position.

Moving forward, Compagnie Financière Tradition aims to continue its organic growth strategy. The company will also keep an eye out for external growth opportunities. Emphasizing “the quality of its balance sheet and cost discipline,” the firm plans to invest in its hybrid broking capabilities and data analytics activities, backed by its in-house data science expertise.

New Share Buyback Program

In a strategic move to better use its capital, the company revealed plans for a share buyback program in May. Initially scheduled to kick off in June 2023, the program eventually got underway at the end of August. The firm intends to acquire as many as 300,000 bearer shares, which amounts to nearly 3.91% of the total share capital.

If executed at the most recent closing price of CFT shares, this initiative would set the Swiss company back approximately CHF 35 million. The program is slated to continue until May 2026 at the latest, although the total budget for the buyback was not specified.