CMC Markets (LON: CMCX) announced today (Monday) its decision to reduce its headcount by 17 percent, which constitutes about 200 positions in the company. The move came as a part of its “cost reduction and efficiency plans.”

Significant Reduction in Costs

With the layoff, the London-headquartered broker is expected to incur a one-off, non-recurring cost of about £2.5 million in fiscal year 2024. However, the move will result in an estimated annualized realized savings of £21 million in the fiscal year 2025, representing an 18 percent reduction against consensus staff costs.

“The Group continues to focus on driving efficiencies and making structural savings across its global operations,” the company's official announcement stated.

“Cost reductions have been primarily achieved by merging support functions across multiple business lines, streamlining reporting lines, and automating processes. The Group will continue to seek opportunities to drive efficiencies and control costs while remaining committed to investing in growth opportunities and ensuring its technology remains market-leading.”

CMC Tries to Recover

Last month, CMC Markets raised its income forecast for fiscal year 2024 by £40 million and is now expecting to close the year ranging between £290 million and £310 million. Meanwhile, the brokerage closed the first half of the ongoing fiscal year with a pre-tax loss of £2 million as its net operating revenue declined 20 percent to £122.6 million.

Last September, the brokerage group promoted Albert Soleiman as the new Chief Financial Officer, replacing Euan Marshall who retired from the role and CMC's board.

CMC is not the only broker to take a drastic step of massive layoffs to cut costs. Last year, its local competitor, IG Group,reduced 10 percent of its staff globally, which was around 300 positions. Under the move, IG even axed executives, including Robert van Eyden, the CEO for South African operations, and recently Kevin Algeo, the former CEO of APAC and Africa, who spent the last decade with the broker.