Two key UK subsidiaries of US market-making giant Citadel Securities delivered contrasting financial performances in 2024, with the company's European trading unit facing headwinds while its finance arm posted robust growth.
Combined, the two entities generated comprehensive income of $1.01 billion, representing a 12.3% increase from the previous year's $903.4 million.
Cital Securities UK’s Trading Unit Feels Market Pressure
Citadel Securities Europe Limited, the firm's primary market-making operation in the region, saw comprehensive income tumble 58% to $47.3 million from $112.8 million the previous year. Revenue fell 28% to $310.8 million as trading volumes declined across the company's core markets.
The unit, which focuses on liquidity provision in equities , futures, interest rate swaps and government securities, attributed the downturn to reduced market activity. Operating expenses dropped 15% to $239.3 million, though this wasn't enough to offset the revenue decline. Operating profit plummeted 53% to $71.5 million.
"The decrease in income and operating expenses was in line with expectations following a corporate structure reorganization which resulted in all staff employed by the company transferring to related CS Group entities," the company noted in regulatory filings.
Despite the challenges, Citadel Securities Europe maintained its focus on expanding electronic trading capabilities. The unit plans to leverage its fixed income platform to enter GBP-denominated instruments and is eyeing expansion into China.
Financial Performance Comparison - Citadel Securities UK Subsidiaries
Metric | Citadel Securities Europe Ltd 2024 | YoY Change Europe (%) | Citadel Securities Finance UK Ltd 2024 | YoY Change Finance (%) |
Total Income | $310.8M | -28.1% | $1,920.7M | +3.6% |
Operating Expenses | $239.3M | -14.8% | $953.8M | +5.2% |
Operating Profit | $71.5M | -52.7% | $2,050.4M | +10.6% |
Total Comprehensive Income | $47.3M | -58.1% | $966.9M | +22.3% |
Finance Arm Shows More Resilience
Citadel Securities Finance UK Limited painted a markedly different picture, with comprehensive income surging 22% to $966.9 million. The investment-focused unit, which trades financial instruments on a proprietary basis, generated revenue of $1.92 billion, up 4% from the prior year.
The finance unit's return on capital employed remained strong at 35%, though down from 48% in 2023. Shareholders' equity climbed to $2.7 billion from $1.9 billion, reflecting the unit's robust trading performance across multiple asset classes.
Operating expenses rose 5% to $953.8 million as the company continued investing in trading strategies and technology infrastructure. The unit also expanded its treasury services to other Citadel Securities entities.
Combined Operations Show Growth
When combined, the two UK units delivered total comprehensive income of $1.01 billion, representing a 12% increase from the previous year's $903.4 million. The finance unit's strong performance more than compensated for the European trading arm's decline.
Both entities maintained strong balance sheets with no long-term debt. The companies' combined shareholders' equity exceeded $3 billion.
Combined UK Operations Summary
Year | Combined Total Income | Combined Operating Expenses | Combined Comprehensive Income | Combined Total Assets | Combined Shareholders Equity |
2024 | $2,231.5M | $1,193.1M | $1,014.2M | $8,359.5M | $3,047.2M |
2023 | $2,286.2M | $1,187.5M | $903.4M | $6,872.1M | $2,292.0M |
Change (%) | -2.4% | +0.5% | +12.3% | +21.6% | +32.9% |
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