IG Group kicks off share buyback program with £100 million tranche

abdelaziz Fathi

Spread betting and CFDs broker IG Group plc today commences a further share buyback program of £250 million, which was announced earlier in July.

The UK-listed online trading platform broker released a statement that it has entered into non-discretionary instructions with Morgan Stanley to conduct the first tranche, which will be limited to a maximum aggregate market value of £100 million. The buyback activity is scheduled to start on 2 August 2023 and will be completed on or before 12 December 2023.

IG Group added that the transaction will be carried out in accordance with the authority granted to the board at the broker’s annual general meeting held on 21 September 2022. As per this authority, the maximum number of shares that can be repurchased under the first tranche is 26,164,535.

Maintaining a balanced approach between funding growth in key channels and returning excess liquidity to shareholders, IG Group said that sole purpose of the program is to reduce share capital.

Earlier in April, IG Group plc extended its share buyback program by £50 million. The extension, in addition to the broker’s previous 150-million-pound buybacks, took the total size of the program up to £200 million. The third tranche followed a previous £50 million special buyback program announced in January. In July 2022, IG commenced its buyback program of up to £150 million.

The board revealed that it aims to reduce ‎the company’s share capital by means of purchasing its ordinary shares from time ‎to time using existing cash resources. The company added that special share buybacks or other distributions will be considered on a regular basis.

IG Group revealed last month that its revenues were £1.02 billion in the twelve months through May, higher by 5 percent than £972.3 million in the prior year. On an adjusted basis, which includes interest on client money, total revenue was also up 6% from £967.3 million in FY 2022.

Out of this figure, tastytrade contributed £170.3 million ($205.0 million) in FY 2023 revenues, up 41 percent on a yearly basis.

IG’s net trading revenue fell by 3% YoY, reaching £941.8 million from £972.3 million in FY22. The adjusted net trading revenue also saw a 3% decline. Interest income, however, witnessed a strong increase, soaring to £80.8 million compared to £0.8 million a year ago.

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