This week, UK-registered and licensed subsidiaries of LMAX Group released their financial reports for 2023. Although their combined revenue grew compared to the previous year, increased administrative costs prevented them from achieving a net profit.
LMAX Limited and LMAX Broker Limited Reveal 2023 Financials
According to LMAX Limited's report, LMAX Exchange achieved trading volumes of $4.5 trillion in fiscal year 2023. It is a 5% increase from the previous year. Average Daily Volumes (ADV) rose to $17.4 billion, achieving a CAGR exceeding 10% over the past five years.
The UK-based LMAX subsidiary also managed to increase gross revenues to £25.8 million, up from £24.1 million reported the previous year. LMAX Broker Limited also reported positive revenue growth, reaching £25.9 million compared to £21.9 million in 2022.
Combined, the two companies generated revenue of nearly £52 million. However, increased administrative expenses led to a decline in operating profit and a significant reduction in net results.
“The economic outlook remains challenged, with the frailties caused by the pandemic intensified by geopolitical conflict, which has forced government policymakers, central bankers and corporate leaders to contend with a unique variable on a scale not experienced in decades,” LMAX commented.
For LMAX Broker Limited, net profit shrank from £3.2 million to £1.8 million. LMAX Limited's results fell from a £0.6 million profit to a £2.6 million loss. Consequently, the combined result for the two subsidiaries shows a lack of profitability and a loss exceeding £0.75 million.
For comparison, the entire LMAX Group reported a net profit of £7.2 million during the same period. At the end of last month, the Group also released results for the first half of 2024. It reported a gross profit of $650 million and a total EBITDA of $20 million.
In October 2023 LMAX successfully completed the acquisition of the FX business of Cürex, a New York City-based institutional foreign exchange execution services and data analytics company.
“The combination of LMAX Exchange and Curex brings together the distribution scale and technical capabilities of both businesses to create a stronger, more diversified, firm liquidity, institutional FX offering for clients to include execution venues, precise market data and trade analytics,” the company report commented.
LMAX Expands Portfolio and Leadership
Last week, LMAX announced its acquisition of FX HedgePool, a specialist in institutional swaps matching. It has thereby enhanced its service range in this sector. The financial terms of this deal have not been disclosed. FX HedgePool's proficiency in FX swaps and forwards markets, along with its extensive network of both buy-side and sell-side relationships, ideally complements LMAX’s existing institutional clientele in the FX division.
In June, LMAX revealed the introduction of FX Non-Deliverable Forwards (NDFs) trading on its central limit order book. This development is designed to meet the increasing demand for FX NDF trading in the Asia Pacific region, which is experiencing a deepening of institutional liquidity and ongoing enhancements to market structure.
Additionally, LMAX Group has recently appointed Luke Dorney as the lead for its digital asset custody growth strategy. Dorney was formerly with Blockdaemon. He has served in various capacities including Head of Sales for EMEA, General Manager, and VP of Sales for the US and EMEA. He brings a wealth of experience to his new role as Head of Custody.
Furthermore, in May, LMAX named Chris Knight as Managing Director. With over 30 years of experience in financial markets, Knight will be moving from Sydney to London this summer to start in his new role.
