TP ICAP reported a slow start to the second half as the high level of trading activity during lockdown started to fade.
Despite a slowdown in activity the inter-dealer broker maintained its guidance of low single-digit revenue growth for the year.
TP ICAP increased underlying profits in the period to £136m, up from £134m the year before. This was despite incurring a £10m charge due to an increase in unused annual leave as of the end of June.
Revenue rose from £922m in 2019 to £990m to the end of June, while operating profit edged up from £158m last year to £159m in the first half of this year.
Why it’s interesting
Revenue from the broker’s global broking division rose two per cent as stronger rates partially offset weaker currency and money markets.
Institutional Services increased 50 per cent as it benefited from increased client appetite. The broker acts as the go-between for banks and investment houses in daily trading so usually benefits from heightened market volatility.
TP ICAP said trading in July had slowed down and is materially lower than 2019 but said is guidance of low single-digit revenue growth remains unchanged.
It also said that its targeted investment spend it set out in March will be “partially deferred”. “We will prioritise investment projects based on business needs,” it said in a statement. “We aim to invest c£15m of cash in 2020, of which c£7m will be expensed.”
What TP ICAP said
Chief executive Nicolas Breteau said: “Despite the challenges posed by the pandemic, we have grown revenues and underlying profitability whilst advancing our strategic priorities of aggregating liquidity across our brands, increasing electronification and diversifying our revenue streams.”
“We paid our full year dividend and have declared an interim dividend. Our performance is a testament to our operational strength, scale and diversified business portfolio, as well as the hard work and dedication of our teams.”