Cmc Markets Plc · LSE:CMCX
Cmc Markets — FY2024 Earnings Presentation
36 slides from Cmc Markets's earnings presentation, Jun 20, 2024
Slide 1: Results Presentation
CMC MARKETS PLC 133 HOUNDSDITCH, +44 (0)20 7170 8200 CMCMARKETS.COM/GROUP LONDON, EC3A 7BX Results Presentation Full year ended 31 March 2024 20 June 2024
Slide 2: Today's presenters
Introduction Today’s presenters Lord Peter Cruddas Albert Soleiman David Fineberg Matthew Lewis Laurence Booth Chief Executive Officer Chief Financial Officer Deputy Chief Executive Head of APAC & Head of Capital Officer Canada Markets FY Results Presentation | 2024 2
Slide 3: Key Highlights
Key Highlights Strategic initiatives designed to broaden growth opportunities and diversify revenue streams demonstrating success • Record financial performance, outside COVID-19 pandemic period, demonstrates strength of our product, power of our technology and successful implementation of our strat
Slide 4: Financial update
Financial update Albert Soleiman CFO FY Results Presentation | 2024 4
Slide 5: Key Performance Indicators: Group
Key Performance Indicators: Group Net operating income¹ (£m) Net revenue mix 17% 14% 12% 332.8 281.9 288.4 83% 86% 88% FY22 FY23 FY24 FY22 FY23 FY24 Trading net revenue Investing net revenue Profit before tax (£m) & profit before tax margin (%) Basic earnings per share & dividend per share (p) 32.5%
Slide 6: Income Statement
Income Statement Net operating income Group (£m) FY24 FY23 YoY % Net operating income of £332.8 million (FY23: £288.4 million), up 15%, marks a new Trading net revenue 259.1 233.1 11% record-high outside the COVID-19 pandemic period and driven by: Investing net revenue 34.0 37.9 (10%) • Strong growt
Slide 7: Liquidity and regulatory capital
Liquidity and regulatory capital Regulatory capital Net available liquidity Group (£m) FY24 FY23 Group (£m) FY24 FY23 Common Equity Tier 1 Capital1 383.1 363.1 Own funds 325.8 309.7 Less: intangibles, investment in associates and Non-segregated client and partner funds 119.6 49.4 (43.0) (36.3) defer
Slide 8: Financial Outlook
Financial Outlook Net operating income: • Current trading proving encouraging, with positive trends seen early in the new fiscal year • Management is therefore expecting to achieve net operating income of between £320-360 million in FY25 Operating costs (excluding variable remuneration): • Whilst we
Slide 9: Investing business update
Investing business update Matthew Lewis Head of APAC & Canada FY24 Results Presentation | 2024 9
Slide 10: Key Performance Indicators: Investing
Key Performance Indicators: Investing Net operating income (£m) Assets under administration (£bn) 48.0 11.0 37.9 45.7 34.0 6.5 0.9 40.5 39.6 FY22 FY23 FY24 Investing net revenue Interest income Investing net revenue: B2C and B2B mix1 20% 39% 39% 72% 80% 61% 28% 2022 2023 2024 2022 2023 2024 B2B B2C
Slide 11: Invest Australia – B2B
Invest Australia – B2B Important client acquisition channel and source of growth Key highlights • Over 120 wholesale relationships including tier one/two banks, investment houses, financial planners and advisory firms • Serving 270k underlying client accounts • Contributed c.30% of brokerage revenue
Slide 12: Invest Australia
Invest Australia Strong underlying financial performance with 9% growth year-on-year in local currency Net operating income (local currency) 1,2 FY24 net operating income was £44.5 million, in line with prior year, 100 + 9% with growth in underlying performance in local currency of 9% year-on- 80 ye
Slide 13: Invest Strategic Expansion
Invest Strategic Expansion Multi-pronged approach through product and regional expansion Product expansion – Physical crypto trading • Launched September 2023 to our retail customers • First mainstream broker to introduce physical crypto driven by significant client demand, all within a single platf
Slide 14: Trading update
Trading update David Fineberg Deputy CEO FY Results Presentation | 2024 14
Slide 15: Key Performance Indicators
Key Performance Indicators Trading net revenue (£m) Proportionate B2C/B2B split of turnover2 259.1 18% 30% 233.1 33% 229.6 FY22 FY23 FY24 Revenue per active client1 (£) 82% 4,685 70% 67% 3,968 3,575 FY22 FY23 FY24 FY22 FY23 FY24 B2C B2B 1. Active clients represent those individual clients who have t
Slide 16: Proportionate increase in volumes from B2B clients
Proportionate increase in volumes from B2B clients Investing AuA by B2B & B2C split1 Trading AuA by B2B & B2C split 27% 30% 34% 35% 42% 89% 73% 70% 66% 65% 58% 11% FY22 FY23 FY24 FY22 FY23 FY24 Investing B2C Investing B2B Trading B2C Trading B2B 1. Shift in client mix from 2023 is driven by the migr
Slide 17: CMC Markets Connect
CMC Markets Connect Laurence Booth Head of Capital Markets FY Results Presentation | 2024 17
Slide 18: Connect Once, Connect the World
Connect Once, Connect the World API connectivity, tailored to the needs of our partners Digital - Assets AI B2C B2B FY Results Presentation | 2024 18
Slide 19: Connect Once: Partnership Solutions
Connect Once: Partnership Solutions One-stop solution for all our partners financial needs I AP on cti ne on eC On FY Results Presentation | 2024 19
Slide 20: Connect Micro Services
Connect Micro Services A product and customer-focused build with API connectivity making the platform scalable and bespoke for our customers API Connectivity Global markets & Global solutions Investment Products Execution Services Multi-Asset Multi-Product Funds, ETFs, Tax Wrappers High Touch, Low T
Slide 21: FY Results Presentation | 2024
CMC MARKETS PLC 133 HOUNDSDITCH, +44 (0)20 7170 8200 CMCMARKETS.COM/GROUP LONDON, EC3A 7BX FY Results Presentation | 2024 21
Slide 22: Data Science & AI
Data Science & AI Digital - Assets USD 4 Annual Turnover Tn 8 400+ Bn trade data points stored daily Institutions served globally 3,000+ modules FY Results Presentation | 2024 22
Slide 23: Strategic update
Strategic update Lord Peter Cruddas CEO FY Results Presentation | 2024 23
Slide 24: Delivering growth through diversification
Delivering growth through diversification Diversification strategy underpinning strong financial performance and unlocking future business opportunities Product Market-leading New geographies development technology & markets • Rollout of options • CMC Markets Connect • Launch of CMC Invest products
Slide 25: Leaner cost base and operational efficiencies supporting margin expansion
Leaner cost base and operational efficiencies supporting margin expansion With a disciplined level of investment, we are set to deliver sustainable profit margin expansion in the years ahead Driving operational synergies Managing global headcount Efficient treasury management ü Merging of support fu
Slide 26: Strategic Outlook
Strategic Outlook Continuing to deliver on our diversification strategy, with an institutional first approach Diversified revenue through our key business divisions Institutional first approach – recognising the value and opportunity within the B2B segment as we continue to drive the business toward
Slide 27: Q&A
CMC MARKETS PLC 133 HOUNDSDITCH, +44 (0)20 7170 8200 CMCMARKETS.COM/GROUP LONDON, EC3A 7BX Q&A
Slide 28: Appendices
CMC MARKETS PLC 133 HOUNDSDITCH, +44 (0)20 7170 8200 CMCMARKETS.COM/GROUP LONDON, EC3A 7BX Appendices
Slide 29: Appendix 1: CMC Markets Connect signs major fintech partnership with Revolut
Appendix 1: CMC Markets Connect signs major fintech partnership with Revolut Press release from 18 June 2024 CMC Markets Plc (CMC) is pleased to announce a fintech partnership with global neobank, Revolut. The partnership will see the two companies connecting via multiple APIs, with the user interfa
Slide 30: Appendix 2: Income Statement
Appendix 2: Income Statement Group (£m) FY 2024 FY 2023 YoY % Revenue 324.7 311.2 1% Interest income on own funds 11.2 4.7 136% Interest on client funds 23.8 9.2 160% Total revenue 359.7 325.1 11% Rebates & levies (26.9) (36.7) 27% Net operating income1 332.8 288.4 15% Operating expenses (inc. varia
Slide 31: Appendix 3: Operating Expenses Breakdown
Appendix 3: Operating Expenses Breakdown Group (£m) FY 2024 FY 2023 YoY % Operating expenses¹ increase of £32.3m (15%) driven by increase in net Net staff costs (excl. variable remuneration) 100.8 84.9 (19%) staff costs and one-off costs incurred IT costs 39.7 33.7 (18%) • Net staff costs increased
Slide 32: Appendix 4: Balance Sheet
Appendix 4: Balance Sheet Group (£m) 31 March 2024 31 March 2023 Non-current assets Intangible assets 28.9 35.3 Property, plant and equipment 28.5 22.8 Deferred tax assets 6.2 4.8 Financial investments 0.0 0.0 Trade and other receivables 2.8 2.7 Investment in associates and joint ventures 2.5 - Tota
Slide 33: Appendix 5: Own Funds Flow Statement
Appendix 5: Own Funds Flow Statement Group (£m) FY 2024 FY 2023 Operating activities Profit / (loss) before tax 63.3 52.2 Depreciation and amortisation 27.4 15.6 Other non-cash adjustments 2.1 1.7 Tax paid (8.6) (17.1) Own funds generated from operating activities 84.2 52.4 Movement in working capit
Slide 34: Appendix 6: Client money and broker margin requirements
Appendix 6: Client money and broker margin requirements Client money¹ (“AUM” - £m) Broker margin requirements (£m) 250 Max: £222m 650 Max: £216m Max: £203m 200 600 150 Max: £138m 550 100 500 50 450 400 0 Mar-20 Sep-20 Mar-21 Sep-21 Mar-22 Sep-22 Mar-23 Sep-23 Mar-24 1 2 3 4 21 22 23 -2 -2 -2 -2 p- p
Slide 35: Disclaimer
Disclaimer Certain statements in this presentation constitute or may constitute forward-looking statements. Any statement in this presentation that is not a statement of historical fact including, without limitation, those regarding the Company’s future expectations, operations, financial performanc
Slide 36: CMC MARKETS PLC 133 HOUNDSDITCH, LONDON, EC3A 7BX
CMC MARKETS PLC 133 HOUNDSDITCH, +44 (0)20 7170 8200 CMCMARKETS.COM/GROUP LONDON, EC3A 7BX