IG Group’s revenue tops £1 billion, but profit down 8%

The UK online trading leader said its “high-quality client base” continues to provide an enduring revenue stream, with client retention rates in line with historical averages.

IG Group stated 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.

Profit after tax was reported at £363 million, down 8 percent compared to £396 million in FY2022. Additionally, flat revenue performance combined with cost control delivered an adjusted profit before tax margin at the top end of its guidance at 48.0% (FY22: 51.1%), IG noted.

IG’s new client acquisitions somewhat moderated during the period as anticipated in less volatile market conditions. The FTSE 250-listed firm said that its total number of active clients stood at 358,300 compared to 381,500 a year earlier. Although this figure decreased by 6 percent, it still remains more than double the number of clients before the pandemic. First trades reduced as anticipated, but also remain well above pre-pandemic levels, the broker said.

IG Group added that the revenue generated in its core markets – countries regulated by the European Securities and Markets Authority, Australia, Singapore, Switzerland, Dubai and South Africa – amounted to £815 million. This figure was slightly down by one percent from £827 million the previous year.

IG Group’s revenues from high potential markets, by contrast, jumped by 40%, reaching £207.0 million relative to £148.3 million in 2022. Additionally, its US operation yielded strong results, with total revenue increasing by 47% to £191.3 million.

Additionally, Spectrum’s total revenue surged by 68% to £15.7 million (compared to £9.3 million in FY22). Notably, Societe Generale and UniCredit were onboarded as third-party issuers during the year, contributing to the impressive growth.

The FTSE 250-listed group described the performance of its OTC business as excellent across all regions while reflecting, in particular, increased trading in commodities and indices. The company’s diversification strategy also continued to progress, with non-OTC total revenue, including associated interest income, accounting for 21% of IG’s total revenue, an increase from 16% the previous year.