(Alliance News) - TP ICAP PLC on Friday said profits for the first half of 2020 fell as it noted a slowdown in trading activity at the beginning of the second half.
Shares in the FTSE 250-listed interdealer broker were 8.0% lower at 308.80 pence each on Friday morning in London.
TP ICAP said pretax profit for the six months to June 30 was GBP78 million, down 6.0% year-on-year from GBP83 million. This was despite revenue rising 7.4% to GBP990 million from GBP922 million.
The London-based company said the Covid-19 pandemic led to higher volatility and volumes, particularly in February and March, which subsequently resulted in higher revenues in its Energy & Commodities, Institutional Services and some Global Broking asset classes.
However, profit was hurt by higher business reorganisation costs due to the proposed group redomiciliation, a GBP10 million expense due to an increase in unused annual leave as at June 30, and an Asia Pacific goodwill impairment.
TP ICAP wants to incorporate a new holding company in Jersey, but said Friday that Covid-19 has delayed the process of seeking regulatory approvals. It hopes to seek shareholder approval and post documentation by the end of 2020, with completion of the move soon thereafter.
An interim dividend of 5.6p was declared Friday, unchanged from the year prior.
Looking ahead, Chief Executive Nicolas Breteau said: "The second half has started slowly with July volumes materially lower than in 2019. We remain cautious and expect to see continued episodic volatility and the frequency, duration and intensity of these periods will be more significant determinants of our performance than usual."
Cash held as at June end was GBP728 million.
By Ife Taiwo; ifetaiwo@alliancenews.com
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TP ICAP (TCAP)