MONEX forecasts $16m capital loss after IBFX MT4 accounts sale

Japanese online trading giant MONEX Group today issued an announcement detailing the financial impact of the sale of the MT4 accounts of its IBFX subsidiary to US broker FXCM earlier this month.

MONEX estimates that the deal will result in a capital loss of USD 16 million (JPY 1.7 billion), which will in its turn lead to a USD 14 million hit on the net income of the group during this financial year. The bulk of the loss will be incurred in the second quarter of the fiscal year to the end of March 2015.

The goodwill of Monex’s US business will be as follows:

-Before the transfer: $97 million (about JPY 10.5 billion)

-After the transfer (forecast): $83 million (about JPY 9 billion)

In addition, MONEX says that in the first quarter of the current fiscal year its US segment suffered a USD 800,000 pre-tax loss related to the MT4 business. This sheds a light on the rationale for the disposal of the MT4 accounts.

In the face of the dull financial news, MONEX said today that it still plans to pay dividends, albeit really small ones, to its shareholders for the second quarter of the fiscal year. The forecast size is JPY 1.2 per share, down from JPY 11 per share a year ago.

Also on Wednesday, MONEX published its financial performance highlights for August 2014, with the numbers failing to bring relief for one more month. Operating revenues continued to decline: in August 2014 they amounted to JPY 3.86 billion, down by 1.8% from the JPY 3.93 billion recorded in July 2014. On the brighter side, the revenues were slightly higher (+0.5%) from the levels seen in August 2013.

Financial expenses kept rising, with the group’s efforts to stem costs apparently failing to bring the desired effect. In August 2014, Monex’s financial expenses reached JPY 465 million, up by 3.8% from July 2014 levels and by 38% from levels seen in August 2013.

Meanwhile, the gradual phasing out of the MT4 platform at Monex Inc – the Japanese FX broker, gains pace. The brokerage announced this morning the official halt of the demo MT4 service.

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MONEX forecasts $16m capital loss after IBFX MT4 accounts sale


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