CMC Markets Plc today (Monday) issued an upbeat trading update for its 2024 financial year (FY24) ending 31 March 2024. The publicly listed (LSE: CMCX) retail broker expects to achieve net operating income £40 million higher than previously guided.

CMC Markets Upgrades FY2024 Guidance

CMC Markets delivered a strong performance in the third quarter of FY24, driven by an improvement in market conditions and increased contribution from its B2B and institutional business. The Group has benefited from its long-term investments in this business area.

As a result of the robust Q3 growth, CMC Markets now expects to generate FY24 net operating income of between £290-310 million, raised from its previous guidance of £250-280 million. Then, the company cut its forecasts, which led to a decline in the stock price and investor confidence. At least, the current increase should slightly improve sentiment.

CMC Markets stated that its core key performance indicators remain robust, including client money Client Money Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Client money refers to the money or margin – which may be any currency in the form of cash, check, draft, or electronic transfer – that a firm receives or holds for a client. Money held by a firm in the form of a stakeholder, which is are not payable on demand or immediately due, also refers to client money. The definition of client money does not apply to money held by businesses that operate in its own name on behalf of a client. Although the client does have to be in agreement before this arr Read this Term, assets under administration, and active clients across both its trading and investing operations.

The Group's FY2024 operating cost expectations, excluding variable remuneration, remain unchanged at £240 million. CMC Markets will provide a further update at its pre-close update on 9 April 2024.

Weaker Start to the Year and CFO Change

The rebound in forecasts is particularly significant given that it follows a weak H1 FY24. The company reported a year-on-year decline of 20% in net operating revenue, amounting to £122.6 million. This downturn was marked by a pre-tax loss of £2 million and a negative basic earnings per share of 0.8 pence. The trading net revenue, a major contributor to the total operating revenue, witnessed a decrease of 32% to £87.4 million.

Amidst these financial shifts, CMC Markets appointed Albert Soleiman as the new Chief Financial Officer in September 2023, succeeding Euan Marshall. Soleiman, who has been with the company since 2005, brings a wealth of experience from his previous roles within the firm, including the Tax Manager for Asia Pacific and the Group Head of Tax. His tenure at CMC Markets included the position of Head of Client Asset Management. Soleiman's promotion is seen as a strategic move to enhance business efficiencies and drive the company’s strategic vision.

In parallel with these organizational changes, CMC Markets has expanded its offerings with the launch of CMC Invest, its stock trading platform, in Singapore. This move followed the successful introduction of the platform in the United Kingdom and Australia. CMC Invest aims to provide investors with comprehensive tools and insights to navigate the financial landscape.