CMC Markets stock rallies as brokerage firm prepares to slash 17% of workforce

Rick Steves

The group expects to report a net operating income of between 290 million pounds and 310 million pounds for the current financial year. The announcement drove the price of the CMC stock upwards by 11% to £147. 

CMC Markets, a London-listed online trading platform, announced on Monday a reduction of its global workforce by approximately 200 positions. This cut represents 17% of its total staff, following the completion of a cost review.

The company expects to incur a one-off, non-recurring cost of around 2.5 million pounds (equivalent to $3.2 million) in this fiscal year due to these job cuts. However, it anticipates an annualized savings of 21 million pounds starting from the 2025 financial year.

CMC Markets forecasts net operating income of between £290-310 million

The trading platform industry, including CMC Markets, experienced a surge in revenue during the COVID-19 pandemic and in 2022, fueled by market volatility caused by Russia’s invasion of Ukraine. Despite this, trading activities saw a relative decline in 2023, although a year-end increase in volatility, spurred by conflicts in the Middle East, provided some benefits to these platforms.

CMC Markets reported that the cost reductions were mainly achieved by merging support functions across various business lines, streamlining reporting lines, and implementing process automation. Despite the workforce reduction, CMC Markets confirmed that trading remains consistent with its projections.

The group expects to report a net operating income of between 290 million pounds and 310 million pounds for the current financial year. The announcement drove the price of the CMC stock upwards by 11% to £147.

CMC Markets operates in various segments, including Trading and Investing, and provides clients with the ability to trade a wide range of financial products. The company has a presence in around 12 countries, including the United Kingdom, Australia, Germany, and Singapore, serving both retail and institutional clients.

CMC Markets enhancements include AQMetrics, Skale, LumeFX

As part of the automation efforts being put into place at CMC Markets, the company recently partnered with AI-powered MiFID II transaction reporting firm AQMetrics, which offers an innovative customer support model. CMC Markets and its clients can look forward to a support system characterized by dedicated teams, personalized assistance, and a proactive approach to their compliance needs.

The collaboration promises to offer a platform with advanced reporting capabilities, real-time monitoring, and customizable dashboards, all aimed at enhancing the user experience for MiFID II Transaction Reporting.

Another enhancement was CMC Markets Connect’s partnership with CRM provider Skale, which offers a fully customizable back office, CRM, multi-layered IB portal, and traders’ area.

Skale’s platform is pre-integrated with the FX market’s leading plug-ins including trading platforms, payment service providers, KYC tools, marketing tools, and business intelligence tools.

CMC Markets’s institutional arm also went live with Lucera’s LumeFX product suite to bolster its existing in-house FIX connectivity offering for FX, thus allowing the provider of liquidity and white label trading solutions to rapidly scale its wholesale non-bank FX market-making business.

LumeFX is an aggregator that offers latency execution and expansive connectivity to the FX market. The solution allows for flexible control over liquidity pools, price aggregation, distribution, and order routing while responding to pre-set risk limits automatically.

The platform is fully managed, so there is no software to install or infrastructure to manage. Also, there are no API integrations to maintain or complete, allowing brokers to focus on generating new business. The software also comes with quantitative analysis that allows its operators to optimize and grow trading for the benefit of all counterparties. The software is co-located in NY4, LD4, TY3, and CH2. The matching engine is unique as each client runs their instance, thereby removing any single point of failure.

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