ICAP Sees 10% Drop in Half Year Revenues Amid Lower Volatility

The multinational broker has cited market conditions and clients' spending on regulatory matters as culprits for the decline, and now


ICAP, a leading trading venue, has published a trading update ahead of the Group’s full results to be published in mid-November. Today’s update outlines some of the highlights for the half-year ended  September 30, 2014. ICAP reported first-half revenue of £736 million in 2013 and will report this year’s first-half earnings on November 19th.

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The main highlight from the update is that Group revenue for the half-year to September 30, 2014 is expected to be 10% lower than the previous year.

Michael Spencer, Group CEO, ICAP
Michael Spencer, Group CEO, ICAP

Regarding the Global Markets and EBS businesses ICAP stated, “Trading performance was materially impacted by bank deleveraging, combined with low interest rates and subdued FX volatility but showed significant month-on-month improvement in September.”

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ICAP’s iconic CEO, Micheal Spencer said: “There was some good improvement to client activity in September, as central bank actions led to an increase in foreign exchange and interest rate volatility pushing average daily volumes on EBS to more than $100 billion per day for the first time in twelve months.”

However, the institutional broker admitted, “Low volatility levels and a focus by our clients on costs and regulation resulted in execution volumes remaining suppressed during much of the period.”

“We continue to invest heavily in new product initiatives across our leading Electronic Markets and Post Trade divisions, which already contribute more than 70% of the Group’s operating profit. We are now starting to see a return on investment in the form of the strong performance of TriOptima and the EBS Direct service, which in September achieved average daily volumes of $19 billion per day in less than a year from its launch, which is a very impressive achievement,” said Mr. Spencer.

EBS Direct is a relationship-based disclosed liquidity service which works alongside ICAP’s ECN platform.

In a separate announcement, ICAP confirmed that its Group Finance Director, Iain Torrens, is set to leave the company to join TalkTalk Group as Chief Financial Officer (CFO).

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