IG Group Holdings plc (IG) faced a challenging first six months of the fiscal year 2024 (FY24) as softer market conditions and reduced volatility in various asset classes took a toll on their financial performance.
Total revenue for the company witnessed a 9% decline, falling from £519.1 million to £472.6 million compared to the previous year.
Net trading revenue saw a steeper decline of 19%, dropping from £494.9 million to £402.4 million during the same period in 2023.
The adjusted profit before tax also suffered a substantial hit, decreasing by 21% to £205.7 million from £260.7 million in the previous year.
After-tax profit showed an even steeper drop of 32%, settling at £154.8 million. Earnings per share followed suit, shrinking from 49.7 pence to 38.9 pence.
The number of active clients experienced a minor decrease, falling from 312,000 to 296,300. Additionally, the acquisition of new clients declined from 37,500 to 33,800.
Despite these challenges, there were some positive indicators.
The adjusted profit margin remained robust at 43.5%, and net interest income surged to £70.2 million, up from £24.2 million, primarily due to higher interest rates.
Charlie Rozes, the Acting CEO of IG Group, expressed optimism about the company’s diversified revenue streams and their potential to drive future growth. Rozes will be succeeded by the newly appointed permanent CEO, Breon Corcoran.
Rozes commented, “It’s encouraging to see the benefits of our diversification strategy paying off, despite a mixed trading backdrop for our clients, driven by persistently low levels of market volatility in Q1 and Q2.”
To address rising operating costs, which increased by 11% to £310.4 million compared to H1 2023, IG Group initiated a cost savings program with the goal of achieving £50 million in annual savings by 2026.
The company also reduced its regulatory capital requirement by 40% and repurchased £149.2 million worth of shares.
The CEO of IG Group stated, “We’ve taken action to control growth in the cost base, significantly reducing the rate of cost growth from FY23, yet still making selective investments in the business.”
Furthermore, IG Group made significant leadership changes. Matthew Davidson was appointed as the new Chief Executive Officer of IG’s Australia and New Zealand unit.
Eren Eraslan took on the role of Head of Northern Europe at IG Europe GmbH, showcasing his extensive experience in the financial industry.
Additionally, IG Prime welcomed Andrew Wood as the Institutional Sales Manager, strengthening its team and expanding its institutional services worldwide.