IG Group’s H1 FY2020 Revenue in Line With Forecasts
IG Group, the owner of spread betting and CFD trading platform IG, recently published its results for the six months to November. The period represents the first half of the company’s fiscal year 2020. According to the report, net trading revenue declined in line with IG’s previous estimates.
ESMA’s New Measures Had a Slight Negative Impact
IG’s net trading revenue in the first six months of the fiscal year 2020 was 249.9 million pounds, missing the company’s forecast made in December last year only slightly. Compared to the first half of the fiscal year 2019, the indicator fell 0.44%, as the company recorded trading revenue of 251 million pounds at the time. The report suggests that the decline is explained by the fact that the previous fiscal year included two months of trading before the production intervention measures of the European Securities Market Authority (ESMA) took effect.
In August 2018, the European regulator imposed new rules that limit several practices in trading contracts for differences (CFDs) and binary options.
IG’s operating profit was 100.1 million pounds in the six months to November, down 11% compared to 112.5 million pounds reported in the same period of fiscal 2019.
IG said that its performance in the core markets, which include businesses in the UK, European Union, EMEA non-EU, Singapore, and Australia, was in line its expectations considering a more rigid regulatory environment.
The company’s second business category, which it calls “significant opportunities,” achieved much better results. The revenue in this category came in at 40.4 million pounds in the first half of fiscal 2020, which is 12.2 million pounds higher compared to H1 FY2019. The increase was driven by solid results in Emerging Markets and Japan. The latter generate revenue growth of over 80% year-on-year.
IG is Confident About The Second Half
The CFD and forex trading provider said that it expects the following targets for the whole fiscal 2020:
IG Group CEO June Felix commented:
We are now six months into the delivery of our multi-year strategy and are on track to deliver on the medium-term growth targets we have set ourselves. Early indications are very encouraging with continued growth in the client base in our Core Markets, and convincing progress in the areas identified as Significant Opportunities.
Speaking about the company’s strategy, Felix welcomed Mike McTighe as the new Chairman of the group. McTighe will take the role in February.
In a separate report, IG said that Paul Mainwaring, the company’s chief finance officer and executive director, had informed the Board about his intention to retire from executive roles. Mainwaring will continue to work until IG finds a successor.
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