ThinkMarkets reports higher profit for 2021 despite 37% revenue drop
The UK business of Melbourne-based broker, ThinkMarkets, today reported its financial results for the fiscal year ending December 31, 2021. The multi-asset platform, trading in the UK as TF Global Markets UK, had seen mixed results in a couple of key areas over a yearly basis.
ThinkMarkets’ 2021 revenues dropped 37 percent year-over-year, to £2.73 million compared to £4.38 million for the fiscal year 2020.
The bottom-line metrics were, however, better over a yearly basis. Specifically, the company’s net income totaled £304,988, which is up 9.3 percent year-over-year from £278,925 in the prior year.
This mixed performance can be attributed to lower operational costs and administrative expenses, which dropped 40 percent to £2.48 million compared to £4.1 million a year earlier.
The company is currently undertaking research and development to improve the performance of its existing brokerage services. The aggregate amount of research and development expenditure recognised as an expense during the year was £347 , 438 (20 20 : £ 352,133 ),” the company explains in its latest filing with the UK Companies House.
The bulk of ThinkMarkets’ revenues came from clearing its trades with the parent company in Australia. In 2020, the FCA-regulated holding company, TF Global Markets (UK) Limited provided a geographical breakdown that shows £4.38 million of the total proceeds was reported on a cost-plus basis, based on its agreement with the parent company.
The UK firm further explains that an amount of £3.3 million (2020: £3.6 million) was owed by the parent company, TF Global Markets (Aust) Pty Ltd. This amount includes £1.7 million collateral deposit (against clients open positions), held with the parent company. The deposit earns 4% interest per annum and is repayable on demand, it said.
TF Global Markets has completed its fourth year of operation in the UK which came amidst a major rebranding project in which the firm changed its name from ThinkForex to ThinkMarkets.
ThinkMarkets has recently launched a new prime brokerage unit under the brand Liquidity.net. ThinkMarkets expects its multi-asset offering to yield a potential market opportunity. For this purpose, it strengthened the dedicated institutional desk with prime broker partnerships alongside a white label product through MetaTrader 4, MetaTrader 5, and Integral platforms.
ThinkMarkets is a multi-licensed online forex brokerage firm, authorized and regulated by the UK Financial Conduct Authority (FCA) and the Australian Securities and Investments Commission (ASIC).
The firm expanded its global footprint through its licensed South African firm. It also acquired the Japanese FX firm, Japan Affiliate, in a move that allows ThinkMarkets to offer its service in the Asian country.