ICAP plc Interim Management Statement
London, 7 February 2013 - ICAP plc (IAP.L), the world's leading interdealer broker and provider of post trade risk and information services, today issues its Interim Management Statement for the period from 1 October 2012 to 6 February 2013 and the outlook for ICAP's financial year ending 31 March 2013.
As previously indicated, trading conditions for the quarter ended 31 December 2012 remained challenging with a pronounced slowdown in Global Broking volumes in December. For the third quarter, Group revenue was 13% lower compared with the same quarter the previous year. Activity levels in January, however, improved across the business, including a 17% year-on-year increase in electronic broking volumes.
The cost saving programme remains on track to deliver more than £50 million in the current financial year and at least £60 million of annualised cost savings by the year end. Consequently, ICAP expects pre-tax profits for the year to 31 March 2013 to be within the current analyst range of £280 million to £305 million.
Commenting on the third quarter, Michael Spencer, Group Chief Executive Officer of ICAP, said: "While December was even slower than expected, we've seen a marked improvement in trading volumes since the beginning of January across our entire business, although it is premature to tell if this is the start of a more sustained upturn. Our balance sheet remains strong and our cost reduction programme remains on track. Despite the challenging market environment we continue to innovate and develop our business. Next week we will launch i-Swap, our electronic interest rate swap platform, in the US. This will build on the success of our market leading Euro platform. We have received positive feedback from customers on the many changes we've made at EBS and our new service, EBS Direct, is progressing well. In Post Trade, we've successfully expanded our customer base and product portfolio with a number of new initiatives.
"We remain well positioned for the opportunities that regulatory changes in the market landscape will bring. The push towards more electronic trading and risk mitigation of OTC derivatives plays to our strengths as we have invested in developing the services and technology that our customers will need to meet the new regulatory requirements."
