IAP.L Regulatory News (IAP)

ICAP plc Interim Management Statement

London, 7 February 2013 - ICAP plc (IAP.L), the world's leading interdealer broker and provider of post trade risk and information services, today issues its Interim Management Statement for the period from 1 October 2012 to 6 February 2013 and the outlook for ICAP's financial year ending 31 March 2013.

As previously indicated, trading conditions for the quarter ended 31 December 2012 remained challenging with a pronounced slowdown in Global Broking volumes in December. For the third quarter, Group revenue was 13% lower compared with the same quarter the previous year. Activity levels in January, however, improved across the business, including a 17% year-on-year increase in electronic broking volumes.

The cost saving programme remains on track to deliver more than £50 million in the current financial year and at least £60 million of annualised cost savings by the year end. Consequently, ICAP expects pre-tax profits for the year to 31 March 2013 to be within the current analyst range of £280 million to £305 million.

Commenting on the third quarter, Michael Spencer, Group Chief Executive Officer of ICAP, said: "While December was even slower than expected, we've seen a marked improvement in trading volumes since the beginning of January across our entire business, although it is premature to tell if this is the start of a more sustained upturn. Our balance sheet remains strong and our cost reduction programme remains on track. Despite the challenging market environment we continue to innovate and develop our business. Next week we will launch i-Swap, our electronic interest rate swap platform, in the US. This will build on the success of our market leading Euro platform. We have received positive feedback from customers on the many changes we've made at EBS and our new service, EBS Direct, is progressing well. In Post Trade, we've successfully expanded our customer base and product portfolio with a number of new initiatives.

"We remain well positioned for the opportunities that regulatory changes in the market landscape will bring. The push towards more electronic trading and risk mitigation of OTC derivatives plays to our strengths as we have invested in developing the services and technology that our customers will need to meet the new regulatory requirements."

Business PerformanceIn the third quarter, Global Broking activity levels were impacted by the ongoing economic, monetary and regulatory uncertainty, which further exacerbated the traditional year-end slowdown. Trading activity improved in January with the start of our bank customers' new financial year, reflecting an increase in risk appetite and debt issuance.

On ICAP's electronic foreign exchange and fixed income platforms, EBS and BrokerTec, total average daily volumes for the quarter ended 31 December 2012 were $664 billion, a decrease of 9% year on year. In January, average daily spot FX volumes on the EBS platform were $141bn, up 22% year-on-year and average daily volumes on the BrokerTec platform were $627bn, an increase of 16% year-on-year. This rise is attributed to: an increase in US Treasury volumes as trading accelerated following the fiscal cliff resolution; the early repayment of the ECB LTRO (€137bn) which helped to lift secondary Repo market volumes; and an increase in volatility in EBS's core currency pairs. EBS also achieved a number of new record volume days for certain currencies including offshore renminbi and non-deliverable forwards.

Within our post trade risk and information division, TriOptima has benefitted from the push to reduce notional outstandings within the clearing house. Of the $80.5 trillion interest rate swap notionals eliminated in 2012, $72 trillion was done within LCH SwapClear. Growth in Reset was held back by the lack of interest rate volatility in financial markets although performance has picked up in January. At 31 January 2013 Traiana's Harmony network was processing an average of 1.8 million transactions per day, an increase of more than 85% from the previous year. On 14 January ICAP announced that it had sold a 12% stake in Traiana to seven of its leading customers, giving the business a valuation of $300 million. Collectively, the investors also have an opportunity under certain conditions to acquire in the future an additional 20% equity in Traiana at a cost of up to $82.5 million.

Conference callA conference call for analysts and investors will be held at 8.00am to discuss this statement.To dial in, please call +44 (0) 20 3003 2666. The access password is ICAP.

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About ICAP

ICAP is the world's leading interdealer broker and provider of post trade risk and information services. The Group matches buyers and sellers in the wholesale markets in interest rates, credit, commodities, FX, emerging markets and equity derivatives through voice and electronic networks. It operates several electronic market places. Through our post trade risk and information services we help our customers manage and mitigate risks in their portfolios.

A complete list of all regulatory news for the period from 1 October 2012 to 6 February 2013 can be found at http://www.icap.com/investor-relations/shareholder-information/regulatory-news.aspx