UK prime of prime provider Price Markets UK today unveiled its financial results for the fiscal year ending December 31, 2019, which were characterized by mixed metrics in areas ranging from operating income to revenues.
In terms of its operating income, the company put together a strong year-over-year performance relative to 2018, having yielded a profit of $211,378 (£158,329) compared to an operating loss of £270,949 for the twelve months ending December 2018.
As for its revenues, Price Markets’ metrics were a YoY reflective of the difficult market conditions and regulatory pressures FX brokers faced, according to its latest filing with the UK’s Companies House.
Specifically, Price Markets’s operating revenues more than halved in 2019, coming in at $676,719 (£506,885) from £1,302,954 reported a year earlier. The gross profit, before deducting the staff salaries and other administrative expenses, also dropped to £479,903 from £1.004 million in 2018.
A major strength in Price Markets’ results was seen across its operational costs where the company managed to make significant savings. Administrative expenses, in particular, dropped to only £321,581 last year, which was nearly four times lower than £1.27 million in 2018.
Turning to B2B Business Side
Explaining this achievement, the company said it now operates as a price maker for mainly professional clients and institutions, which keeps their business slim and the majority of its aspects automated. This model helped keep Price Markets’ cost-base down and allows them to pass on savings to customers when executing FX and CFD trades.
EuropeFX Partners with Acuity for AI-Powered News Sentiment AnalysisGo to article >>
Both positive bottom-line figures and the drop in revenue could be attributed to winding down Price Markets’ retail operations. The restructuring of the retail division yields leads to a refocusing of the company’s resources onto the institutional side of the business. This also helped the company lower the headcount and cut its retail platforms related overheads, resulting in a 78% drop in expenses and a 61% drop in revenues.
Additionally, Price Markets continued the development of its proprietary trading platform (priceAPI), which helped the firm secure key-clients, including one of the world’s top 5 brokerage firms by volume. Further, in 2020, the company’s technology revenue has as a result bypassed the trading revenue for the first time.
Price Markets and other brokers decided to close the retail business due to the recent changes in the regulatory environment. Indeed, the retail FX market in Europe is becoming relatively challenging for the brokers, which is why many brokers are looking into new opportunities in the wholesale liquidity and clearing market.
To fund the transformation process on a large scale, the owners of Price Markets injected more capital throughout 2020. Most recently, Matthias Mokin has made an extra investment of nearly £200,000. The German investor bought the majority ownership in Price Markets earlier this year when founder, Alexander Talei sold his stake in the FCA-regulated PoP provider.
Furthermore, Price Markets has reshuffled its senior management, having promoted Alex Iakobachvili, who served as Chief Operating Officer (COO), to take on the role of its Chief Executive Officer (CEO).