British trading platform CMC Markets forecasts higher annual operating income, shares surge

By Echha Jain

(Reuters) -British trading platform CMC Markets on Thursday forecast higher operating income in 2025 after a 52% jump in annual profit aided by strong retail and institutional trading and tight cost control measures, boosting shares to a near-two-year high.

CMC said the higher forecast was driven by factors including the launch of new products and technological advancements.

The company expects net operating income between 320 million pounds and 360 million pounds ($406.5 million-$457.3 million) in fiscal 2025, compared with 332.8 million pounds in fiscal 2024.

Shares of CMC, which provides trading in more than 12,000 financial instruments, including shares, indexes, foreign currencies and commodities, jumped 8.5% to 305 pence apiece at 0800 GMT.

"Having reached the peak of the investment cycle, management continues to seek opportunities to drive further cost efficiencies and deliver margin expansion," CMC said.

Trading platforms like CMC benefited from a revenue boost during the pandemic and in 2022 due to increased market volatility from events like Russia's Ukraine invasion. Also, despite a quieter 2023, they saw a year-end revenue spike due to heightened volatility from the Middle East conflict.

In April, rival Plus500 said it expects its full-year results to beat market expectations, helped by factors like enhancement of its main offering and strategic new acquisitions, among others.

CMC also posted a 52% jump in adjusted pre-tax profit to 80 million pounds for the year ended March 31.

Trading revenue per active client stood at 4,685 pounds, an 18% jump, reflecting the growing proportion of trading volumes generated by high-value, institutional clients.

The results for the second half of fiscal 2024 provide a better outlook on the group's future profitability, showing positive returns on infrastructure investments, albeit in a more favourable market environment, RBC analysts said in a note.

($1 = 0.7872 pounds)

(Reporting by Echha Jain in Bengaluru; Editing by Sonia Cheema and Shri Navaratnam)