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Newly rejuvenated British online trading company London Capital Group (LCG), has today announced the following Interim Management Statement for the nine month period from 1 January to 30 September 2014. Unless otherwise stated, trends and figures below refer to the nine months ended 30 September 2014 and the corresponding period last year.
Financial and Operational Summary:
· Net cash and amounts due from brokers of £18.7m, rising to £35.7m after issuing the convertible loan notes on 17 October 2014
· Revenue from continuing operations down 29.5% to £13.9m (2013:£19.7m)
· EBITDA (excluding nonrecurring items) loss of £2.6m (2013: profit £0.7m)
· Loss before tax from continuing operations £10.7m (2013:£1.8m)
· Results include a restructuring provision of £1.5m and an impairment loss against goodwill of £8.0m
· Adjusted loss before tax £1.6m
Period from 1 October to 17 October 2014:
· New management team being put in place
· Revenue from continuing operations of £2.8 million
· EBITDA of £1.6 million
· Focus on growth and development of people, products and platforms
Charles Henri-Sabet, executive chairman of LCG, said: “Since assuming the role of executive chairman in mid-September, the Group now enters the fourth quarter strongly recapitalised and with a new broad and deep senior management team being put into place to position LCG for growth. Even as we return to revenue growth over the past few weeks on the back of recent favourable volatile global markets, the path to sustainable returns will be about investment in people, products and platforms.
Since the period end, the Group secured investment totalling £17 million through the issue of convertible loan notes on 17 October. The new funding together with existing net cash resources and amounts due from brokers gives total funds of £35.7m.
Revenue from continuing operations over the first nine months was £13.9m (2013: £19.7m), of which £11.6m (2013: £16.4m) was derived from the retail spread betting and CFD business and £2.3m (2013: £3.3m) from the institutional FX business.
Against a backdrop of challenging market conditions earlier in the financial year and a period of losses accumulated under the previous management’s chosen strategy, the new management team has reviewed the Group’s strategy and as a result recognised an impairment loss of £8m against the goodwill attributed to the UK financial spread betting and contracts for difference business unit, bringing the carrying amount to zero. Following a restructure of the Group undertaken over the past few weeks the new management has recognised a restructuring provision for the period of £1.5m.
“Net revenue picked up at the end of the third quarter and accelerated as the Group entered the first two weeks of October on the back of volatile global markets – both in equities and commodities. New management is investing in a reinvigorated workforce and the best in technology to provide the Group and its clients with a firm platform to progress with the next stage of development across our chosen business lines and selected product offerings. We shall be updating on our business strategy, the depth of our new leadership team and our services to customers over the coming quarters as we build growth for all the Company’s investors” concluded Mr. Sabet.
For the full announcement from LCG, click here.