IG Group Q3 revenue down 3.8% in 'quiet period'

Online trading company IG Group reported a 3.8% drop in revenue for the third quarter, which it referred to as a “quiet period” in global financial markets.

In the three months to 28 February 2017, revenue fell to £117.4m on what was the strongest quarter of the previous year. Meanwhile, the number of active clients was up 13%, driven by ongoing success in online marketing, with new first trades in the period over 20% higher than the year before.

Revenue per client declined 15%, with current clients trading less often in the quiet period and the continued growth in the non-leveraged business and Nadex, where average revenue per client is significantly lower.

IG said revenue was ahead in all regions apart from the UK, with a strong performance in the Rest of the World thanks to solid growth in the US, Dubai and South Africa.

In the UK, revenue was off 15% and the company noted that the previous year’s performance had been particularly strong.

“More mature markets tend to outperform in more volatile periods as the large installed client base reactivates, as happened in the prior year, and underperform in quieter conditions,” it explained.

The stockbroking business continued to grow well in the period in both the UK and Australia, with just over 16,000 clients holding a position at the end of February. To extend its unleveraged offering, IG expects to launch its discretionary managed smart portfolio ETF service in the UK during the fourth quarter.

IG’s fourth quarter has started better, although the group stressed it is impossible to predict the market conditions for the rest of the year or to draw precise conclusions at this stage.

“As the company enters this final quarter, none of the announced regulatory changes has yet had any impact, client recruitment remains strong and the underlying business is performing well..”