CMC Markets H1 revenues fall 45pct as markets stabilise

abdelaziz Fathi

CMC Markets reported a drop in revenues and customer income for the April-September period as the market environment stabilised following a period of high volatility after the Covid-19 hit.

In the six months to September 30, margin trading business yielded £101.4 million in net revenue for the H1 FY 2022 , half of the amount it earned in the previous year.

The company’s non-leveraged net trading revenue was £24 million, nearly 19% of total revenues. The figure is also down 8% from $26 million in the same period a year ago, but was up 11% from the half year just ended.

Shares in the FTSE 250 company plummeted over a quarter at one point in September, which wiped off more than £300 million of its market cap after hitting their lowest level in just over a year.

Investors ditched CMC Markets’ stock after it warned that its annual net revenue is forecast to be in a range of £250 million to £280 million, sharply lower from more than £330 million it had set out in July.

CMC Markets, founded by tycoon Lord Cruddas, reported £409.8 million in net operating income for the year ended March 2021.

The online trading firm had a strong underlying performance earlier in the pandemic, which was enhanced by increased market activity in the first quarter. The company saw its shares shine earlier this year as the online trading platform operator doubled its annual net trading revenue, bolstered by the coronavirus-induced volatility.

This solid performance led CMC to get inducted into the FTSE 250, an index which measures the largest companies on the London Stock Exchange. The FTSE 250 Index is a capitalisation-weighted index, and lists the largest 101st to the 350th publicly quoted companies in the UK market.

Finally, CMC Markets updated investors on its joint venture in the stockbroking business with ANZ Bank’s share trading platform, ANZ Share Investing.

In a filing with the London Stock Exchange, the online retail broker said that it will close the acquisition of over 500,000 ANZ retail accounts in the next 12-18 months. With total assets exceeding AUD$45 billion, this is a strategic step to grow CMC’s equity brokerage businesses in the Asia-Pacific region.

The collaboration dates back to 2018 and initially allowed ANZSI’s clients to gain access to CMC’s technology, customer service and execution via an ANZ-branded stockbroking platform.

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