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(Alliance News) - Foreign exchange services provider Argentex Group PLC on Friday reported a fall in interim profit in a period "shaped by the impact of the Covid-19 pandemic".
Revenue for the six months ended September 30 fell 14% to GBP11.8 million from GBP13.8 million the year before. Pretax profit fell 15% to GBP3.5 million from GBP4.1 million the year before.
Argentex said the fall in revenue was driven by part of its client base deferring trading activity in the face of "growing uncertainty" in global markets.
"Whilst Covid-19 has had a severe impact on market dynamics, it is important to note that short-term fluctuations in trading volumes are regularly experienced by a trading business and we have experienced this shift in trading behaviour and conviction in previous periods of significant market uncertainty," Argentex said.
Argentex saw its net cash position rise to GBP20.1 million at September 30 from GBP19.1 million a year before, an increase of 5%. However, this was a fall of 15% since March 31, which was due to the period's expenditure on the new premises and the dividend paid relating to the 2020 financial year.
Looking ahead, Argentex said that while current trading is "encouraging", it is still too early to be confident that trading has returned sustainably to pre-pandemic levels. It expects that trading volumes will recover further "once confidence returns to the market."
Co-Chief Executives Carl Jani and Harry Adams said: "Importantly, the fundamentals of our business remain strong and we experienced a record number of new clients trading in the second quarter, sourced by our expanding and increasingly capable sales team. With our disciplined risk management, balance sheet strength and long-term focus, we remain confident in our ability to navigate the ongoing challenges of Covid-19 and Brexit and continue to deliver sustainable long-term growth for our shareholders."
With the impact of Covid-19 still "unclear for the short term", the company said it is not recommending an interim dividend.
Shares in Argentex were up 0.1% at 119.58 pence in London on Friday.
By Zoe Wickens; zoewickens@alliancenews.com
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