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TP ICAP pleased with strategic progress
10th Mar 2020 07:26
(Sharecast News) - TP ICAP reported a 4% improvement in revenue on a reported basis to ?1.83bn in its final results on Tuesday, or 1% at constant currency.
The FTSE 250 company said it improved its underlying and reported operating profitability, with its operating profit rising to ?279m for the year ended 31 December, from ?276m in the prior year, although its operating margin slipped to ?230m from ?245m.
Underlying profit before tax was ?230m, falling from ?245m, while basic earnings per share were down to 33.8p from 34.2p.
Statutory operating profit was ?142m, up from ?93m, while statutory profit before tax rose to ?93m from ?62m and statutory basic earnings per share totalled 12p, compared to 5.7p.
TP ICAP said its global broking revenue fell 1% on a reported basis, or 3% at constant currency, as resilient rates operations were offset by weaker credit and equities divisions.
Its energy and commodities revenue increased 15% on a reported basis, or 11% at constant currency, thanks to "strong" organic growth, strategic hires, Axiom acquisition and favourable markets.
Institutional services revenue was 23% higher on a reported basis, or 21% at constant currency, while data and analytics revenue improved 15% on a reported basis, or 11% at constant currency.
On the strategic front, TP ICAP noted that it successfully completed the three-year ICAP integration programme during the year, generating ?80m in synergy savings.
It increased its earnings diversification through growth in its non-broking businesses, and said it built a new executive leadership structure to streamline the generation of revenue.
TP ICAP also evolved medium-term strategic themes during the year, focusing on aggregation, electronification and diversification.
The company's board declared an interim dividend of 5.6p per share, which was paid on 8 November, and said on Monday that it was recommending a final dividend of 11.25p per share to be paid on 19 May.
"These results mark an important inflexion point for TP ICAP," said chief executive officer Nicolas Breteau.
"We have completed the three-year integration programme of the ICAP business that we acquired at the end of 2016 and achieved the planned commercial and cost synergies, emerging as the world's leading inter-dealer broker.
"We also spent last year strengthening our management team, enhancing our risk framework and developing our growth strategy based on aggregation, electronification and diversification."
Breteau said the company had a "powerful" market position in global broking, and three "exciting" growth businesses, which the board was aiming to "develop strongly" in the coming years.
"The overall macroeconomic backdrop remains uncertain driven largely by Covid-19, global growth and ongoing Brexit negotiations.
"While this environment impacts our clients' activity, the resulting volatility also creates market opportunities that give us confidence for the future."
At 0821 GMT, shares in TP ICAP were down 1.21% at 350.3p.
The FTSE 250 company said it improved its underlying and reported operating profitability, with its operating profit rising to ?279m for the year ended 31 December, from ?276m in the prior year, although its operating margin slipped to ?230m from ?245m.
Underlying profit before tax was ?230m, falling from ?245m, while basic earnings per share were down to 33.8p from 34.2p.
Statutory operating profit was ?142m, up from ?93m, while statutory profit before tax rose to ?93m from ?62m and statutory basic earnings per share totalled 12p, compared to 5.7p.
TP ICAP said its global broking revenue fell 1% on a reported basis, or 3% at constant currency, as resilient rates operations were offset by weaker credit and equities divisions.
Its energy and commodities revenue increased 15% on a reported basis, or 11% at constant currency, thanks to "strong" organic growth, strategic hires, Axiom acquisition and favourable markets.
Institutional services revenue was 23% higher on a reported basis, or 21% at constant currency, while data and analytics revenue improved 15% on a reported basis, or 11% at constant currency.
On the strategic front, TP ICAP noted that it successfully completed the three-year ICAP integration programme during the year, generating ?80m in synergy savings.
It increased its earnings diversification through growth in its non-broking businesses, and said it built a new executive leadership structure to streamline the generation of revenue.
TP ICAP also evolved medium-term strategic themes during the year, focusing on aggregation, electronification and diversification.
The company's board declared an interim dividend of 5.6p per share, which was paid on 8 November, and said on Monday that it was recommending a final dividend of 11.25p per share to be paid on 19 May.
"These results mark an important inflexion point for TP ICAP," said chief executive officer Nicolas Breteau.
"We have completed the three-year integration programme of the ICAP business that we acquired at the end of 2016 and achieved the planned commercial and cost synergies, emerging as the world's leading inter-dealer broker.
"We also spent last year strengthening our management team, enhancing our risk framework and developing our growth strategy based on aggregation, electronification and diversification."
Breteau said the company had a "powerful" market position in global broking, and three "exciting" growth businesses, which the board was aiming to "develop strongly" in the coming years.
"The overall macroeconomic backdrop remains uncertain driven largely by Covid-19, global growth and ongoing Brexit negotiations.
"While this environment impacts our clients' activity, the resulting volatility also creates market opportunities that give us confidence for the future."
At 0821 GMT, shares in TP ICAP were down 1.21% at 350.3p.