It is with great sorrow that we have learnt of the death of Her Majesty Queen Elizabeth II. Her reign was characterised by a deep, and unwavering, commitment to duty and service on behalf of everyone in this country. We mourn her passing and extend our sincere condolences to His Majesty, and the other members of the Royal Family, at this very sad time.

Financial and interim management report for the six months ended 30 June 2022 (the "Period")
 

TP ICAP Group plc (the "Group") announces its results for the Period today. 

Nicolas Breteau, CEO of the Group, said:

"We have delivered high single digit revenue growth. We have also grown revenue across all our asset classes and increased our market share. A strong performance from Rates, helped deliver an uplift in profitability.

Our transformation continues at pace, including the rollout of Fusion, our award-winning electronic platform. Our focus on diversification is reaping benefits, too. Parameta Solutions is announcing today an enhanced consensus pricing solution in partnership with PeerNova and involving many of the world's largest investment banks. Meanwhile, at Liquidnet, our Dealer-to-Client credit proposition went live, as planned, in June, initially with a small number of clients ahead of a wider campaign. Trades have already been completed and key dealers are connected electronically via API.

We are committed to delivering capital efficiencies for the Group as a strategic priority. In the first phase of a review we are conducting following our Jersey redomicile, we have identified around £100 million of cash that will be generated or freed up by the end of 2023 and used to repay debt. Following that, and as part of the ongoing assessment of the Group's balance sheet and investment requirements, the Board is committed to identifying and returning any resultant surplus capital to shareholders.

Volatility has continued across many markets. Our core franchise, the depth of our liquidity pools, and our ongoing focus on our transformation mean we are well positioned in these market conditions."

Results for the Period

Reported / statutory results:

Adjusted results:

1. Earnings before interest and tax. For reporting purposes EBIT is equivalent to operating profit.

2. Earnings before interest, tax and depreciation & amortisation

3. Attributable to equity holders of the parent

A table reconciling Reported to Adjusted figures is included in the Financial and Operating Review.

The percentage movements referred to in the sections below are in constant currency (unless otherwise indicated). Constant currency refers to prior year comparatives being retranslated at current year foreign exchange rates.

Financial highlights

·      Revenue growth across all business divisions. Higher margin Rates business performing well;

·      We again increased overall market share;

·    Group revenue, excluding Liquidnet, up 7% (up 10% in reported currency); including Liquidnet, Group revenue up 12% (up 15% in reported currency);

·      Global Broking revenue up 8%. All asset classes generated revenue uplift;

·      Global Broking revenue per broker up 14%;

·      Energy & Commodities revenue up 2%. Strong performance in the US and APAC partly offset by decline in European Gas and Power in a "risk off" trading environment;

·      Agency Execution revenue increased by 58%. Excluding Liquidnet, revenue up 10%;

·      Parameta Solutions revenue up 6%. Data & Analytics again delivered double digit revenue growth (11%);

·      On track to achieve £25m of cost savings by the end of 2022;

·      Adjusted EBIT up by 15% to £142m (H1 2021: £123m in constant currency);

·      Reported EBIT increased by 57% to £99m (H1 2021: £63m); and increased by 74% in reported currency (H1 2021: £57m);

·   Adjusted EBIT margin, prior to Russian P&L charges, increased to 16.1% (H1 2021: 12.8% in constant currency); Including Russian impact, adjusted margin was 13.1%;

·      Reported EBIT margin increased to 9.2% (H1 2021: 6.1%);

Capital management highlights

·    Following our Jersey redomicile, we have conducted the first phase of a review which has  identified around £100 million of cash that will be generated or freed up by the end of 2023 and used to repay debt. This will increase our investment grade rating headroom and reduce future finance costs. The Board will continue to assess balance sheet and investment requirements and is committed to identifying and returning any resultant surplus capital to shareholders.

Strategic highlights

·      Continued transformation progress. On track to achieve Fusion rollout targets for the end of 2022;

·      Diversification programme continues, through the following three initiatives:

o  Today, Parameta Solutions is announcing an enhanced consensus pricing solution, leveraging our unique observable transaction data, which we will provide for our global client base. The solution will provide clients with enhanced data for risk and regulatory capital management. This is in partnership with PeerNova, a Silicon Valley data management and analytics firm, and in conjunction with over a dozen of the world's largest investment banks.

o  We are planning to launch (subject to regulatory approval) Fusion Digital Assets, an electronic marketplace for institutions.

o   In May, we became the first inter-dealer broker (IDB) through Parameta Solutions to administer over the counter indices and benchmarks. Part of our strategy to deliver more data driven insights for clients, including for their risk and compliance purposes.

·    The Liquidnet Dealer-to-Client (D2C) proposition launched, as planned, in June. The platform was launched with a small number of clients as the first step, ahead of a wider campaign planned for the second half. The Request for Quote protocol is live and the first trades have been completed. A number of key dealers are already connected via Application Programming Interface (API). This is an exciting growth opportunity for the Group.

·     New senior executives in place to increase the pace of execution. Mark Govoni joined in May from Instinet, where he was President of US Brokerage, to lead Agency Execution. Daniel Fields, previously Global Head of Markets at Société Générale, joined in June to lead Global Broking.

Dividend

An interim dividend per share of 4.5 pence (H1 2021: 4.0 pence) will be paid on 4 November 2022 to shareholders on the register at close of business on 7 October 2022.

Near term outlook

The market environment to date in 2022 has been volatile. This has been driven primarily by monetary policy tightening to combat record levels of inflation, the war in Ukraine and recessionary risks in many countries. This has driven higher trading activity and volumes across most asset classes, which we have benefited from. However, as we often highlight, it remains difficult to predict future levels of market activity, given the highly uncertain macro and geopolitical outlook. Despite the uncertain backdrop, we are cautiously optimistic for the remainder of the year and we are well positioned. In Rates, our outlook is positive, and we will benefit further once activity shifts towards the longer-dated end of the yield curve. Within Energy & Commodities, we expect the risk-off trading environment in the European Gas & Power market to continue in the second half, particularly over the summer months. We expect improved profitability from Liquidnet in the second half.

Group revenue in July 2022 was 1% higher than the corresponding period in 2021, in constant currency.

Forward looking statements

This document contains forward looking statements with respect to the financial condition, results and business of the Company. By their nature, forward looking statements involve risk and uncertainty and there may be subsequent variations to estimates. The Company's actual future results may differ materially from the results expressed or implied in these forward-looking statements.

Enquiries:

Analysts and investors
Dominic Lagan
Direct: +44 (0) 20 3933 0447

Email: dominic.lagan@tpicap.com
 

Media
Richard Newman
Direct: +44 (0) 7469 039 307

Email: richard.newman@tpicap.com
 

About TP ICAP

·      TP ICAP connects buyers and sellers in global financial, energy and commodities markets.

·      It is the world's leading wholesale market intermediary, with a portfolio of businesses that provide broking services, data & analytics and market intelligence, trusted by clients around the world.

·    We operate from more than 60 offices across 27 countries, supporting brokers with award-winning and market-leading technology.

TP ICAP Group plc ("TP ICAP" or the "Group")                                                                

11 May 2022

Trading update for the three months ended 31 March 2022

Highlights

• Group revenue, excluding Liquidnet, up 3% in constant currency. Including Liquidnet, Group revenue up 14%; growth across all business divisions;
• Varied market conditions: Higher level of volatility and trading activity in January / first half of March; more subdued volumes in February and later in March;
• We again increased overall market share during the first quarter;
• Better revenue mix: growth across all Global Broking asset classes other than Equities (unchanged);
• Global Broking revenue per broker up 8%;
• Data & Analytics again delivered double-digit revenue growth;
• Good progress on transformation programme: TP Interest Rate Options desk now has #2 market share (from #4), benefiting from Fusion deployment.

Revenue by division

1.     Inter-division charges have been made by Global Broking and Energy & Commodities to reflect the value of proprietary data provided to the Parameta Solutions division. The Global Broking inter-division revenues and Parameta Solutions inter-division costs are eliminated upon the consolidation of the Group's financial results.

2.     In Q1 2021, £6m of revenue was included within Agency Execution relating to the post-acquisition period of Liquidnet (the acquisition completed on 23 March 2021);  This Liquidnet revenue has been restated to £8m by including an additional £1m of revenue previously reported in Global Broking, and £1m previously reported in COEX Partners (in Agency Execution), reflecting the transfer of desks, which, due to their complementary nature and strategic fit, have been reclassified to be managed and reported as part of Liquidnet.

Revenue by division (constant currency basis):

• Global Broking revenue up 3%, benefitting from increased market volatility. Revenue grew in Rates, Credit, FX & Money Markets and Emerging Markets, but was flat in Equities, resulting in an improved mix.

         - Rates activity increased most notably in short-dated contracts, which have lower transaction values compared with longer-dated contracts;

         - Revenue per broker (productivity) improved by 8%.

• Energy & Commodities revenue up 5% driven by growth in Oil and Power & Gas in the US, while in Europe, Power & Gas declined, as high prices and significant volatility led to lower volumes.
• Agency Execution revenue of £89m increased by 154%. Liquidnet revenue of £62m was in line with market activity. Market share increased marginally in the US and was stable in Europe, where we remain a market leader.
• Parameta Solutions: Continued double-digit revenue growth in Data & Analytics (+11%).

Strategic progress:      

Mark Govoni, former President of US Brokerage at Instinet, joined the Group on 2 May 2022 as the new CEO of Agency Execution, with a primary focus on driving the Liquidnet growth strategy;

• Parameta Solutions became an FCA authorised benchmark administrator in May: the first inter-dealer broker that will administer over the counter ('OTC') benchmarks;
• Digital Assets Spot Platform: Hudson River Trading added to the list of market makers; custodian network expanded to include BitGo and Komainu.

2022 AGM:

• The Group will host its Annual General Meeting today, Wednesday 11 May 2022, at 2.15pm (BST) at the offices of Allen & Overy LLP, One Bishop's Square, London, E1 6AD.

Forward looking statements

This document contains forward looking statements with respect to the financial condition, results and business of the Company. By their nature, forward looking statements involve risk and uncertainty and there may be subsequent variations to estimates. The Company's actual future results may differ materially from the results expressed or implied in these forward-looking statements.

Enquiries:

Analysts and investors
Dominic Lagan
Direct: +44 (0) 20 3933 0447

Email: dominic.lagan@tpicap.com
 

Media
Richard Newman
Direct: +44 (0) 7469 039 307

Email: richard.newman@tpicap.com

About TP ICAP

• TP ICAP connects buyers and sellers in global financial, energy and commodities markets.
• It is the world's leading wholesale market intermediary, with a portfolio of businesses that provide broking services, data & analytics and market intelligence, trusted by clients around the world.
• We operate from more than 60 offices across 27 countries, supporting brokers with award-winning and market-leading technology.