22 Oct 2014 07:00
22 October 2014
LONDON CAPITAL GROUP HOLDINGS PLC
("London Capital Group", "LCG", the "Company" or the "Group")
Interim Management Statement for the nine months ending 30 September 2014
LCG, an online trading innovator, today announces the following Interim Management Statement for the nine month period from 1 January to 30 September 2014. Unless otherwise stated, trends and figures below refer to the nine months ended 30 September 2014 and the corresponding period last year.
Financial and Operational Summary:
· Net cash and amounts due from brokers of £18.7m, rising to £35.7m after issuing the convertible loan notes on 17 October 2014
· Revenue from continuing operations down 29.5% to £13.9m (2013:£19.7m)
· EBITDA (excluding nonrecurring items) loss of £2.6m (2013: profit £0.7m)
· Loss before tax from continuing operations £10.7m (2013:£1.8m)
· Results include a restructuring provision of £1.5m and an impairment loss against goodwill of £8.0m
· Adjusted loss before tax £1.6m
Period from 1 October to 17 October 2014:
· New management team being put in place
· Revenue from continuing operations of £2.8 million
· EBITDA of £1.6 million
· Focus on growth and development of people, products and platforms
Charles Henri-Sabet, executive chairman of LCG, said: "Since assuming the role of executive chairman in mid-September, the Group now enters the fourth quarter strongly recapitalised and with a new broad and deep senior management team being put into place to position LCG for growth. Even as we return to revenue growth over the past few weeks on the back of recent favourable volatile global markets, the path to sustainable returns will be about investment in people, products and platforms.
Since the period end, the Group secured investment totalling £17 million through the issue of convertible loan notes on 17 October. The new funding together with existing net cash resources and amounts due from brokers gives total funds of £35.7m.
Revenue from continuing operations over the first nine months was £13.9m (2013: £19.7m), of which £11.6m (2013: £16.4m) was derived from the retail spread betting and CFD business and £2.3m (2013: £3.3m) from the institutional FX business.
Against a backdrop of challenging market conditions earlier in the financial year and a period of losses accumulated under the previous management's chosen strategy, the new management team has reviewed the Group's strategy and as a result recognised an impairment loss of £8m against the goodwill attributed to the UK financial spread betting and contracts for difference business unit, bringing the carrying amount to zero. Following a restructure of the Group undertaken over the past few weeks the new management has recognised a restructuring provision for the period of £1.5m.
Net revenue picked up at the end of the third quarter and accelerated as the Group entered the first two weeks of October on the back of volatile global markets - both in equities and commodities. New management is investing in a reinvigorated workforce and the best in technology to provide the Group and its clients with a firm platform to progress with the next stage of development across our chosen business lines and selected product offerings. We shall be updating on our business strategy, the depth of our new leadership team and our services to customers over the coming quarters as we build growth for all the Company's investors."
For further information, please contact:
London Capital Group Holdings plc
Charles-Henri Sabet, Executive Chairman
020 7456 7000
Cenkos Securities plc
Nicholas Wells
020 7397 8900
Morgan Rossiter
James Rossiter/ Richard Morgan Evans
0203 195 3240
(1) References in this statement to "revenue" refer to net trading revenue, which are the net gains and losses on the provision of spread betting and CFD products, commission income, exchange gains and interest.
Notes to Editors:
London Capital Group Holdings plc (hereafter "LCGH plc" or "LCG" or "London Capital Group" or "the Group") is a financial services company offering online trading services.
London Capital Group Limited (LCG Ltd), a wholly owned trading subsidiary of LCGH plc, is authorised and regulated by the Financial Conduct Authority. Its core activity is the provision of spread betting and CFD products on the financial markets to retail clients under the trading names Capital Spreads, Capital CFDs and LCG MT. Its other division provides online foreign exchange trading services to institutional and professional clients. LCG Ltd is one of the leading providers of white label financial spread trading and CFD platforms and its white label partners include TD Direct Investing, Bwin.party, and Saxo Bank.
LCG Ltd has a European passport and is a member of the London Stock Exchange. LCG Ltd also has access to international markets through its global clearing relationships.
LCGH plc is listed on the London Stock Exchange's AIM market. LCG is included in the General Financial sector (8770) and Speciality Finance sub sector (8775) and has a RIC code of LCG.L.