CMC Markets Gets More Bullish with FY2021 Income Expectation

CMC Markets (LON:CMCX) is once again looking to close another year with a strong performance as in the latest trading update for the third quarter of 2020, between October and December, the company revealed high client income retention that contributed positively to its business.

The London-based company detailed that over 80 percent of the client incomes were retained during the quarter. However, it was less than the figures achieved in the first half of the year. 

The overall business ‘performed very well’, and the higher number of active clients resulted in strong client activity, which will be reflected in the revenue. However, the metrics could not perform better than the previous financial year.

In the first half of the FY 2020, the company’s revenue from CFDs jumped 135 percent to around £200 million.

Expectations Get Higher

Moreover, the company revised its full-year income expectations and is moving with a more bullish stance. It upped its expected net operating income to be £376.6 million, ranging from £370.2 million to £387.5 million, while the pre-tax profits could come in at £197.2 million, ranging from £191.3 million to £206.3 million.

Commenting on the expected numbers, CMC Chief, Peter Cruddas said: “I am very excited about the opportunities to continue to grow and diversify this business on the back of our platform technology. I have talked a lot in the past about investment in technology and people, and this will continue to be a priority as we seek to maintain and expand our competitive advantage.”

Furthermore, he stressed the importance of technology expertise in CMC’s product expansion. The company is targeting to diversify its revenue stream with other upcoming projects but did not provide enough detail on them.

“Continued investment in our risk infrastructure is delivering latency reduction and pricing and execution efficiencies. This allows us to capture a higher percentage of our premium client income, especially during volatile market conditions,” Cruddas added.