TP ICAP announces successful delivery of regulatory requirements under MiFID II


TP ICAP chairman retures

TP ICAP plc has announced its preliminary statement of results for the year ended 31 December 2017.

Strategic and Operational highlights

  • A resilient performance in a low volatility environment
  • Successful delivery of regulatory requirements under MiFID II
  • Average revenue and contribution per broker increased in all regions

Integration highlights

  • £27m synergy savings delivered in the year, ahead of schedule (original 2017 target £10m)
  • £52m of annualised run rate synergy savings achieved
  • Costs to achieve synergies of £79m (original 2017 target £40m)
  • Headcount reduction of 295 in the period
  • Focus on non-compensation expenses
  • Property and infrastructure rationalisation under way

Financial highlights

Underlying prior year comparative numbers are shown on a pro forma basis only (i.e. including ICAP). Statutory prior year comparatives are also shown as reported by Tullett Prebon plc (“TP plc”) on a standalone basis.

Underlying (before acquisition, disposal and integration costs, and exceptional items)

  • Revenue of £1,757m (2016: £1,687m)
  • Operating profit £263m (2016: £240m)
  • Operating margin 15.0% (2016: 14.2%)
  • Profit before tax £233m (2016: £232m)
  • Basic EPS 33.3p (2016: 34.0p)

Statutory (after acquisition, disposal and integration costs, and exceptional items)

  • Operating profit £102m (2016: £181m pro forma, £73m reported)
  • Operating margin 5.8% (2016: 10.7% pro forma, 8.2% reported)
  • Profit before tax £72m (2016: £167m pro forma, £57m reported)
  • Basic EPS 15.8p (2016: 23.2p pro forma, 17.8p reported)

A table showing Underlying and Statutory figures for each period, detailing the acquisition, disposal and integration costs, and exceptional items is included in the Financial and Operating Review.

The average number of shares used for the basic EPS calculation for the period is 551.8m.

Dividend

The Board has recommended an unchanged final dividend of 11.25p per share, making the total dividend for the year 16.85p per share, unchanged from that paid for 2016. The final dividend will be payable on 17 May 2018 to shareholders on the register at close of business on 6 April 2018.

Commenting on the results, John Phizackerley, Chief Executive of TP ICAP plc, said:

Last year was a good first year for TP ICAP, and saw us benefit from the diversity of our product portfolio and geographic footprint by delivering a resilient performance in a low volatility environment.

Our integration is progressing well as we accelerated synergy savings from 2018 into 2017. As a result we achieved £27m of synergy savings in 2017, ahead of our initial £10m target. The next phase of the integration will focus on delivering our IT plan and ensuring that the organisation is fit for purpose in a rapidly changing environment. We remain committed to achieving our £100m synergy saving target by 2020.

Our industry has gone through a major regulatory change with the introduction of MiFID II, and I’m pleased to say that our dedicated programme – which was a multi-year project – was successfully delivered.

So far in 2018 we have seen an encouraging start to the year, with a pick-up in volatility and interest rates. Although it is too early to tell whether these conditions are sustainable, our diversified business model and position as the world’s largest interdealer broker leave us well-placed for future growth.

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TP ICAP announces successful delivery of regulatory requirements under MiFID II

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