IG battles European decline

New over-the-counter (OTC) leveraged clients of 14,626 were down almost a fifth on the prior year, resulting in an 8 per cent decline in active clients. Professional clients generated 58 per cent of revenue in the ESMA region, with sign-ups higher in the UK than elsewhere in Europe. That meant domestic revenue per client grew 5 per cent on the prior year to £2,594, against a 17 per cent reduction across the rest of the EU.

Lower volatility within commodities and waning interest in cryptocurrencies also meant revenue from trading those assets was down 28 per cent and 62 per cent, respectively, in contrast to an uptick in indices and equities. The sharedealing and investments business also enjoyed an increase in revenue of more than a third to £2.5m.

Several new business launches are on the cards for 2019. The German-based European subsidiary is expected to start trading by the end of January, as part of the group’s Brexit mitigation strategy. Management also hopes to take advantage of a lack of competition within the US retail FX dealing market, rolling out a new business by the same date. The group is also developing a multilateral trading facility, Spectrum, which it expects to launch by May. The platform will offer turbo warrants – a venue traded limited risk product – which it says European clients are more familiar with than its existing OTC CFD product.  

Broker Numis expects adjusted pre-tax profits of £218m during the year to May 2019, giving EPS of 47.5p (2018: £281m, 61.2p).