CLS Group, the market infrastructure provider of risk mitigation and settlement services to the global forex market has published its interim financial report for the first half 2018. The firm reported slow growth during the period despite record trading volume in CLSSettlement for the period ending on June 30, 2018.
During the period, the company earned revenue of £101.5 million ($133 million) which 1.6 per cent higher from £99.9 million back in H1 2017, despite the record half-year average trading volume of USD1.84 trillion. The bottom line of the company yielded a net loss of £525,000 ($690,000) in H1 2018, as against profit of £5.4 million in H1 2017. The operating income also failed to reflect the stellar operational performance with a loss of £0.8 million ($1.06 million), relative to a profit of £13.8 million a year ago.
The group’s operational expenses increased by 13 per cent that includes negative impacts of forex translation and ongoing business investment. One of the significant changes in the business of CLSSettlement is the asset’s amortization period in being reduced, which will impact the future profitability. This reflects the company’s strategy to replace and modernize the underlying technology platform supporting the CLSSettlement. The adjusted net profit of the company during the period was £9.2 million as against £11.8 million for the same period last year
Commenting on the latest financials of the company, outgoing CEO, David Puth said:
“Market volatility continued to be the predominant theme in currency markets throughout the first half of the year. We saw record traded volumes in CLSSettlement, driven by this increased volatility as well as greater participation by a wider segment of the FX market, culminating in a record half-year average traded volume of USD1.84 trillion. Traded volume was up 19% compared to the same period last year and 26% against the second half of 2017.”
Trevor Suarez, CLS’ Chief Financial Officer, said.
“The financial strength of CLS continues to be strong. This is best demonstrated by the level of our cash balances, which remain well above the minimum regulatory requirements and, after allowing for an additional level of capital in the form of a buffer, provides a further level of prudence.”
He added: “CLSSettlement will use a new platform that will enable improved efficiency, multi-session capability, and adhere to the highest level of industry standards to support our future strategic goals.”
