15 Jan 2015 07:00
15 January 2015
LONDON CAPITAL GROUP HOLDINGS PLC
("London Capital Group", "LCG", the "Company" or the "Group")
Year-end trading update
Revenue and underlying profits growth in fourth quarter
London Capital Group Holdings plc gives the following trading update in respect of the financial year ended 31 December 2014. LCG will publish its results for the year ended 31 December 2014 on 25 March 2015.
Group revenue for the year is expected to be £22.5m (2013 continued operations: £25.2m). Revenues accelerated during the fourth quarter, the first trading period for the Group's new management, with £13.9m at the end of the third quarter ending 30 September 2014 and the balance of £8.6m in the fourth quarter ending 31 December 2014.
Full year 2014 adjusted profit before tax is expected to be in the region of £0.3m (2013 continued operations: £2.2m). Adjusted profit before tax is stated before recognising a small credit in relation to share based payments, impairment of goodwill of £8.0m, non-recurring restructuring costs of £1.4m and a credit relating to the Financial Ombudsman Service (FOS) claims provision which is no longer required of £0.6m.
At the year end the outstanding FOS claims provision is £0.5m (2013: £4.7m) with the payment of new claims still on-going.
Underlying trading profitability accelerated during the fourth quarter in response to top line revenue growth delivered during the three months ending 31 December 2014. The Group moved from a position of underlying losses at the end of the third quarter to finish the year with a small underlying trading profit.
The Group remains well capitalised with net cash resources and amounts due from brokers totalling £34.9m at 31 December 2014.
Charles-Henri Sabet, executive chairman of LCG, said: "The Group starts the new financial year transformed, making underlying profit on the back of revenue growth that accelerated during the fourth quarter and has strongly positioned us to take advantage of growth opportunities within our chosen markets. The final quarter of 2014 saw the Group restructured with a strongly recapitalised balance sheet and a new senior leadership team put into place.
LCG's executive team has also recently been strengthened with a revitalised main board of directors who collectively bring a broad spectrum of skills and experience at the highest level within the financial, professional and investment services industries, all ideally suited for the next stage of the Group's development of new products and expansion into overseas markets.
Trading volumes and net revenue picked up in the fourth quarter, with the Groups under new management responding well to the wider volatility in global markets - both in equities and commodities - continuing a trend that began at the tail end of the third quarter. Underlying trading profitability ended the year in positive territory, providing early confirmation that the building blocks are in place from a newly installed management to continue to drive growth as the new financial year progresses. We anticipate that volatility within the equities, commodities and foreign exchange markets will continue into the new financial year, although at this stage it is too early to predict the extent to this period of volatility, while we as a Group will remain steadfast in the pursuit of growth in line with our chosen strategy in new and existing markets.
We shall continue to progress the delivery of a new range of sophisticated investment and trading products using the best in responsive technology platforms to the benefit of our existing clients and in support of our expansion into new markets. We continue to invest in quality staff, ensuring we can deliver an institutional level of service and product in response to client demand and position the Group for a return to sustainable growth at all levels of the business."
ENDS
For further information, please contact:
London Capital Group Holdings plc
Charles-Henri Sabet, Executive Chairman
020 7456 7000
Cenkos Securities plc
Nicholas Wells
Callum Davidson
020 7397 8900
Morgan Rossiter
James Rossiter/ Richard Morgan Evans
0203 195 3240
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.