IG Group predicts 6% YoY drop in revenues in first half 2019

IG Group office

UK online trading leader IG Group Holdings plc (LON:IGG) has just issued an update ahead of entering its close period following the end of the first half of the financial year ending 31 May 2019 (FY19).

Revenue in the first half is expected to be around 6% lower than in the same period in FY18, which was a record for IG. The ESMA leverage cap and Binary options ban came into effect during this period and, as the regulator admitted later, many CFD traders lost money after this action.

Group revenue in the four month period since all the measures came into effect is expected to be around 10% YoY lower. Back then IG informed that it is supportive of the objectives of regulators to improve client outcomes in the industry, and the Company supports ESMA in its efforts to enhance consumer protection and achieve harmonisation of regulation across the EU.

Revenue in that four month period in the ESMA region (UK and EU) is expected to be around 20% lower, with revenue from the Group’s business in APAC and other non-ESMA region countries expected to be around 9% higher. Both of these figures, of course, are underlying changes.

Nearly 70% of UK and EU revenue, during these several months time after ESMA’s action, has been generated by professional clients and their number has also increased during the period.

The number of new OTC leveraged clients who traded for the first time with IG in the period was 14,600 – down with nearly 20% YoY (8,200 in the ESMA region (H1 FY18: 11,666) and 6,400 in the APAC and non-ESMA regions (H1 FY18: 6,361)).

IG Europe has received its license from BaFin. This provides certainty that IG will be able to offer its regulated financial products in all EU member states following the UK’s exit from the EU. More good news during this period from the Group’s USA subsidiary, as it has been approved as a member of the National Futures Association (NFA) and is now registered to operate as a Retail Foreign Exchange Dealer (RFED).

Board Update

Sally-Ann Hibberd, a Non-Executive Director and member of the Audit and Remuneration Committees has today also been appointed as a member of the Nomination Committee.

The company has also announced the appointment of June Felix as Chief Executive Officer (CEO) of the Group and as an executive director on the Board of IG at the end of October.

The next performance announcement from IG will be the financial results for the six months ended 30 November 2018 on 22 January 2019.

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