Forex brokerage IG Group (LON:IGG) reported on Tuesday record-high financial metrics for the six months, ended 30 November, 2016, and announced it is revamping its product offering.
The broker’s comnsolidated net trading revenue jumped 14% on the year to £244.9 million in H1 FY 2017, while its after-tax profit increased by an annual 9% to £83.3 million in the June-November 2016 period. Its operating expenses also went up significantly by 23% on the year to £137.9 million, due to heavy investment in effective marketing.
“This has been another good six months for the business, with record revenue, a new high in active client numbers and ongoing success in attracting and developing the next generation of traders. I am extremely proud of what we have achieved,” Peter Hetherington, IG Group CEO, said. “The business once again proved the resilience of its operating model and its people, as it dealt exceptionally well with the short term volatility in the financial markets caused by two significant political events,” he added.
In its native UK, the broker reported an annual revenue growth of 9% for the six months under review, while revenue from operations in Australia and Europe jumped by 16% and 17%, respectively. The highest annual increase of 28% was generated from operations in the rest of the world (including Japan).
In H1 FY 2017, active clients and new clients also jumped by 22% and 59%, respectively. Active clients increased by double-digit across all markets, except in Australia where the growth was just 9%.
Active clients %
UK (inc Ireland)
ROW (inc Japan)
IG Group expands with new services
IG Group announced it is in the process of revamping its trading portfolio and has already made some changes to its offering. In line with its development strategy, earlier in January the broker received a UK license to offer discretionary managed Investment services. It intends to initially release a passive smart portfolio ETF-based product in the UK in partnership with BlackRock.
In addition, the brokerage house has rolled out dtockbroking services to Australia and France and has launched globally a Limited Risk account with no-negative guarantee, which limits client losses to the amount they have deposited.
Moreover, IG Group said it has stopped offering Sprints binary products to new clients, except for those in the US and Japan. Binary options will not be available to new clients neither directly by the broker, nor via affiliate partners. The broker has already contacted such partners with a request to “remove all banners or links to IG from these immediately (except in the US and Japan)”. However, existing clients can still trade in binary options as they will continue to be available on the broker’s website.
Earlier this month we informed you the broker has renamed its binary options products to Digital 100. However, the trading concept and conditions remained unchanged. The broker mentioned nothing at the time about ceasing to offer this type of instruments in most of its markets.
“Strategically, for some time, we have been shifting our emphasis to active financial trading and investing, deepening and broadening the relationship with our clients. In January, we received our licence from the FCA to offer an investments service to clients in the UK, in partnership with BlackRock, and intend to launch our smart portfolio ETF product in the UK in the near future,” Hetherington said.
In addition to the above alterations, during the six months of the reporting period, IG Group also expanded its offering with the purchase of FXCM‘s its news and research service DailyFX for $40 million.
During the six months of the reporting period, IG Group purchased from FXCM its news and research service DailyFX for $40 million.
IG Group operates worldwide with offices in 15 countries. It offers access to more than 10,000 markets, including forex, indices, shares, exchange-traded funds (ETFs), and binary options. In the UK it also offers spread betting.
The broker is based in the UK and regulated by the Financial Conduct Authority (FCA), but its subsidiaries are also regulated by the relevant authorities in the countries where they operate. It is a licensed bookmaker by the UK’s Gambling Commission and now a managed portfolio provider in the UK.