Saxo Bank Announces Interim Results For H1 2013: Net Income More Than Doubles YoY

Thursday, 22/08/2013 | 09:58 GMT by Andrew Saks McLeod

Saxo Bank has today announced its interim results for the first half of 2013, with a return to form following last year's 88% contraction during the same period. During the first half of 2013, profit grew sixfold.

Saxo Bank Announces Interim Results For H1 2013: Net Income More Than Doubles YoY

Saxo Bank has announced today its interim results for the first half of 2013, a period in which the company doubled earnings when compared with the first half of 2012.

In the first half of 2013, Saxo Bank achieved earnings before tax, depreciation, amortisation, income from associates and joint ventures as well as gains and losses from divestments (adjusted EBITDA) of DKK 676 million, which was more than double the DKK 267 million EBITDA achieved in 2012. Net profit in the first six months of this year grew more than 6 times to DKK 267 million.

During the entirety of last year, the entire FX industry experienced a depletion of volumes, which recovered during 2013 to unprecedented levels, in some cases delivering record results. Whilst Saxo Bank’s figures for the first half of this year reflect this movement, the company attributes this year’s strong performance to its clear focus on core business activities and increasing trading activity has resulted in the Bank achieving its best half-yearly results since 2010. Last year's first half results depicted an 88% decrease in net income, a direction which the company has reversed in 2013.

Operating Income Up 23%

Overall trading activity at the Bank increased in the first half of 2013, continuing the pick-up in FX volumes and volatilities seen in late 2012. Trading volumes in other products on the Trading Platform , such as FX options and CFDs, also saw increased levels compared to 2012. As a result, operating income for the first half of 2013 reached DKK 1,749 million for the Group, which is 23% higher than in the first half of 2012.

Saxo Bank enhanced its concentration of effort on its core activities and its proprietary trading technology and Multi-Asset trading platform.

It has also continued expanding the offering of new products such as new currency crosses, ETF portfolios and a mobile version of the main commercial website and has maintained a high level of investment in developing the trading platform.

Streamlining Via Divestment

The focus on the core business in 2013 led to a number of activities being divested, that included asset management companies CPH Capital, a stake in Capital Four and, in July, Global Evolution. Furthermore, the Bank’s majority stake in EuroInvestor was sold in June.

Operating income for the first half of this year was DKK 1,749 million which equates to $314.82 million as opposed to DKK 1,418 million for H1 2012 and a rise in pre-tax profit also occurred, weighing in at DKK 407 million which equates to $73.26 million as against DKK 76 million for H1 2012.

Saxo Bank's net profit for the first half of 2013 dramatically increased to DKK 267 million which equates to $48.06 miliion, versus last year's DKK 44 million.

Clients’ collateral deposits for trading business equated to DKK 36,931 million which is $6647.58 million as a read across. This is up over last year's DKK 30,223 million for the first half of 2012, and assets under management, referred to as continued business amounted to DKK 13,587 million, equal to $2445.66 million, for the first half of 2013 compared to DKK 13,025 million for the same period last year.

Finally, adjusted EBITDA increased to DKK 676 million which equates to $121.68 million, as against DKK 267 million for H1 2012.

Kim Fournais and Lars Seier Christensen, co-founders and CEOs at Saxo Bank, said in a joint statement: “We are obviously very satisfied with this result and Saxo Bank will continue to pursue growth opportunities by adding more products on the trading platform, targeting new markets and attracting new client segments.”

“At the same time, Saxo Bank will focus on building more valuable relationships with financial institutions, professional traders and high-end clients while continuing to benefit from our strong brand in the mass-market segments.”

Saxo Bank expects the slow recovery of the global economy to continue and prevail, although with drawbacks, during 2013.

According to the company, investor confidence is expected to grow, with less risk aversion than has been seen in recent years. However, looking at the entire year, the Bank still finds the overall market situation uncertain and visibility remains low.

*USD values are converted at the rate as of August 22, 2013 and therefore only apply to the H1 2013 figures.