TIDMIGG
RNS Number : 7721Z
IG Group Holdings plc
22 May 2019
22 May 2019
LEI No: 2138003A5Q1M7ANOUD76
IG GROUP HOLDINGS PLC Strategy and Business Update
IG Group Holdings plc ("IG", "the Group", "the Company"), a
global leader in online trading, is today hosting a strategy and
business update for investors and analysts at its London head
office at 4pm.
Strategy and business update
At the update, CEO June Felix will set out the key strategic
choices the Group has made in pursuit of its vision, the four
growth levers that will be deployed to drive growth, and the market
specific actions the Group plans to take to implement those levers
to deliver sustainable growth and attractive shareholder returns.
The plans lead to a clear set of medium-term financial targets that
will be presented by CFO Paul Mainwaring.
June Felix, Chief Executive, commented:
"The actions that we have taken over the last two years have
resulted in the Company successfully navigating the introduction of
the ESMA measures.
IG has experienced significant change and will continue to do so
in the future driven by regulation, shifting patterns of wealth,
and the continued evolution of financial markets around the
world.
I believe that IG has the capability to adapt and thrive in
these evolving markets and I am excited by the opportunities we
have identified and confident that the Company will return to
growth after FY19.
I am looking forward to leading the implementation of IG's new
strategy to deliver sustainable growth and attractive shareholder
returns."
New and updated information
The Group will set out four levers that it intends to deploy to
deliver revenue growth:
- Expanded distribution channels;
- A global firm with more local focus;
- Segmented target markets; and
- Multi-product offerings.
For the purposes of developing and presenting its strategy, the
Group has categorised its existing businesses into two groups: core
markets and significant opportunities. The categorisation has been
applied to the business segments previously reported by the Group,
but with the APAC segment split into Australia, Singapore, Japan,
and other Asia.
Core markets
In the core markets of the UK, EU (CFDs), Australia, Singapore
and non-EU EMEA (Switzerland, Dubai and South Africa), the Group
will deploy the levers of segmented target markets, and more local
market focus. The revenue from these core markets in FY19 is
expected to be around GBP415m.
Significant opportunities
The Group expects to deploy a combination of all four levers in
the significant opportunities which comprise:
- EU: expanding into new products including Options and Turbo
24s through Spectrum, the Group's MTF;
- USA: leveraging the combination of Nadex, the RFED and Daily FX;
- Japan: product localisation and marketing;
- Other Asia: developing partnerships to access these markets; and
- Institutional segment: focused proposition for an underserved client segment.
Additionally, the Group has identified a potential opportunity
to participate in the leveraged securities market for retail
clients in Hong Kong. A local business development team will now be
established to pursue partnerships and assess the opportunity to
enter the leveraged securities market in Hong Kong.
The revenue from the significant opportunities markets in FY19
is expected to be around GBP60m.
Medium-term financial targets
The Group is targeting the following revenue growth from the
successful implementation of this strategic plan:
- Core markets: revenue growth at around 3-5% per annum over the medium term; and
- Significant opportunities: an increase in revenue of GBP100
million, to around GBP160 million in FY22.
Assuming these targets are achieved, the Group's revenue in FY22
will be around 30% higher than in FY19.
Delivery of this targeted revenue growth will require additional
investment. Operating expenses, excluding variable remuneration,
are expected to be around GBP257 million in FY19, and are expected
to increase by around GBP30 million in FY20. This is primarily due
to additional investment in prospect acquisition to continue to
promote the IG brand, to grow the size and quality of the client
base, and to establish the new businesses in the EU and the USA. In
subsequent years the Group expects its operating expenses,
excluding variable remuneration, to increase at a lower rate than
revenue.
Dividend
The Group's strong financial position provides the capital and
liquidity resources to deliver the new strategy, to support the
business growth, and to pay dividends. The Board reiterates that
the Company expects to maintain the annual dividend at 43.2p per
share until the Group's earnings allow the Company to resume
progressive dividends.
The presentation materials for the strategy and business update
are available on the Group website http://www.iggroup.com/ from 2pm
today. A recording of the presentation and Q&A will be
available from 23 May.
For further information, please contact:
IG Group Investors
Liz Scorer
020 7573 0727
investors@ig.com
IG Group Press
Ramon Kaur
020 7573 0060
press@ig.com
FTI Consulting
Neil Doyle / Ed Berry
020 3727 1141 / 1046
Disclaimer - Market abuse regulation and forward-looking
statements
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation ("MAR"). Upon the publication of this
announcement via Regulatory Information Service ("RIS"), this
inside information is now considered to be in the public
domain.
This statement, prepared by IG Group Holdings plc (the
"Company"), may contain forward-looking statements about IG Group
Holdings plc and its subsidiaries (the "Group"). Forward-looking
statements involve uncertainties because they relate to events, and
depend on circumstances, that will, or may, occur in the future. If
the assumptions on which the Group bases its forward-looking
statements change, actual results may differ from those expressed
in such statements. Forward-looking statements speak only as of the
date they are made, and the Company undertakes no obligation to
update these forward-looking statements. Nothing in this statement
should be construed as a profit forecast.
About IG
IG empowers informed, decisive, adventurous people to access
opportunities in over 15,000 financial markets. With a strong focus
on innovation and technology, the company puts client needs at the
heart of everything it does.
IG's vision is to be a global leader in retail trading and
investments. Established in 1974 as the world's first financial
spread betting firm, it continued leading the way by launching the
world's first online and iPhone trading services.
IG is now an award-winning, multi-platform trading company, the
world's No.1 provider of CFDs* and a global leader in forex. It
provides leveraged services with the option of limited-risk
guarantees and offers an execution-only share dealing service in
the UK, Australia, Germany, France, Ireland, Austria and the
Netherlands. IG has a range of affordable, fully managed investment
portfolios, to provide a comprehensive offering to investors and
active traders.
It is a member of the FTSE 250, with offices across Europe,
including a Swiss bank, Africa, Asia-Pacific, the Middle East and
the US, where it offers on-exchange limited risk derivatives via
the Nadex brand.
*Based on revenue excluding FX (from published financial
statements, February 2018)
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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