Earnings Release • Apr 25, 2024
Earnings Release
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| €million | Q124 | Q423 | Change | Q124 | Q123 | Change |
|---|---|---|---|---|---|---|
| Net trading income | 127.1 | 72.7 | 75% | 127.1 | 110.5 | 15% |
| Other income | 2.5 | 1.6 | 55% | 2.5 | - | - |
| Total income | 129.6 | 74.3 | 74% | 129.6 | 110.5 | 17% |
| Employee expenses | 44.5 | 39.6 | 12% | 44.5 | 44.9 | (1%) |
| Fixed employee expenses | 19.6 | 17.5 | 12% | 19.6 | 20.0 | (2%) |
| Variable employee expenses | 24.9 | 22.1 | 13% | 24.9 | 24.9 | 0% |
| Technology expenses | 15.8 | 15.3 | 3% | 15.8 | 16.6 | (5%) |
| Other expenses | 8.2 | 7.6 | 8% | 8.2 | 7.3 | 12% |
| One-off expenses2 | - | - | - | - | 1.5 | (100%) |
| Total operating expenses | 68.5 | 62.5 | 9% | 68.5 | 70.3 | (3%) |
| EBITDA | 61.1 | 11.8 | 418% | 61.1 | 40.2 | 52% |
| Depreciation / amortisation | 4.3 | 4.2 | 1% | 4.3 | 5.0 | (14%) |
| Write off of (in) tangible assets | - | - | - | - | - | - |
| Profit/(loss) on equity-accounted investments |
(0.4) | (0.1) | 193% | (0.4) | (0.4) | (12%) |
| Profit before tax | 56.4 | 7.4 | 660% | 56.4 | 34.7 | 62% |
| Tax expense | 10.5 | 1.1 | 897% | 10.5 | 7.0 | 50% |
| Net profit | 45.9 | 6.4 | 621% | 45.9 | 27.7 | 66% |
| Basic EPS3 (€) |
1.06 | 0.15 | 615% | 1.06 | 0.64 | 64% |
| Fully diluted EPS4 (€) |
1.04 | 0.14 | 630% | 1.04 | 0.62 | 67% |
| EBITDA margin | 47% | 16% | 47% | 36% |
| €billion | Q124 | Q423 | Change | Q124 | Q123 | Change |
|---|---|---|---|---|---|---|
| Flow Traders Value Traded | 1,555 | 1,450 | 7% | 1,555 | 1,554 | 0% |
| Equity | 819 | 762 | 8% | 819 | 826 | (1%) |
| Fixed income | 270 | 289 | (7%) | 270 | 348 | (23%) |
| Currency, Crypto, Commodity | 422 | 352 | 20% | 422 | 340 | 24% |
| Other | 44 | 48 | (7%) | 44 | 40 | 11% |
| Average VIX | 13.9 | 15.4 | (10%) | 13.9 | 21.0 | (34%) |
€4.3m worth of shares were repurchased in Q124 as part of the €15m share buyback program announced in October 2022, with €7.6m of the program remaining. A portion of the shares to be repurchased under this program could be allocated to employee incentive plans as needed.
Fixed operating expenses guidance for the year remains unchanged and is expected to be in the same range as FY23 as headcount is expected to be flat to down for the year, offset by continued technology investments and inflationary pressures. The firm remains fully focused on operational and cost efficiencies across the business while implementing its growth and diversification strategies and bolstering trading capital.
"Flow Traders achieved a strong result in Q1 on the back of elevated trading activity in the digital assets space in the quarter, despite the relatively subdued market trading environment in other asset classes. This quarter serves as further validation of our growth and diversification strategy, given our initial investment in the digital assets space more than seven years ago and our continued investment in the asset class when others quickly left during the downturn merely a year ago. Our steadfast belief in the asset class, and the opportunities it can bring to traditional financial markets is unwavering. We were well prepared for the highly anticipated regulatory approval in the U.S. for spot Bitcoin ETFs that came through at the beginning in the quarter as institutional interest in digital assets continues to grow around the world.
Coming to the other areas of our trading capabilities, we have seen a slight increase in activity since the lows seen last December, although volatility is still down significantly when compared to a year ago. Regardless of the environment, we have been enhancing our trading capabilities and counterparty network in existing areas as well as exploring new potential opportunities. In terms of our strategic investments, we are well on track with our Euro-denominated stablecoin joint venture AllUnity with our partners DWS and Galaxy Digital, and in Q1 announced a strategic investment in ClearToken, further underpinning our strategy of investing in connectivity and financial market infrastructure.
Looking at our operations, as we continue to focus on cost and operational efficiencies while balancing our key growth initiatives, fixed operating expenses in the quarter came in-line with our expectations. As we continue to execute our growth and diversification strategy and invest in trading capabilities in different asset classes and regions, we believe we can accelerate the growth of the firm with additional trading capital and will look to bolster our trading capital.
In addition, we are thrilled to have Owain Lloyd join Flow Traders on 1 May as Chief Technology Officer. Owain brings with him over 20 years of senior leadership experience across traditional finance, market making, and digital assets trading technology and we look forward to his nomination as an Executive Director of the Board at our AGM on 13 June."
| 13 June 2024 | AGM |
|---|---|
| 17 June 2024 | FY23 final dividend proposed ex-dividend date |
| 18 June 2024 | FY23 final dividend proposed record date |
| 20 June 2024 | FY23 final dividend proposed payment date |
| 30 June 2024 | Start of silent period ahead of H124 results |
| 25 July 2024 | Release of H123 results |
The Q124 trading update analyst conference call will be held at 10:00 am CEST on Thursday 25 April 2024. The presentation can be downloaded at https://www.flowtraders.com/investors/results-centre and the conference call can be followed via a listen-only audio webcast. A replay of the conference call will be available on the company website for at least 90 days.
Investors Eric Pan Phone: +31 20 7996180 Email: [email protected]
Media Laura Peijs Phone: +31 20 7996125 Email: [email protected]
Flow Traders is a leading trading firm providing liquidity in multiple asset classes, covering all major exchanges. Founded in 2004, Flow Traders is a leading global ETP market marker and has leveraged its expertise in trading ETPs to expand into fixed income, commodities, digital assets and FX. Flow Traders' role in financial markets is to ensure the availability of liquidity and enabling investors to continue to buy or sell financial instruments under all market circumstances, thereby ensuring markets remain resilient and continue to function in an orderly manner. In addition to its trading activities, Flow Traders has established a strategic investment unit focused on fostering market innovation and aligned with our mission to bring greater transparency and efficiency to the financial ecosystem. With nearly two decades of experience, we have built a team of over 600 talented professionals, located globally, contributing to the firm's entrepreneurial culture and delivering the company's mission.
This press release is prepared by Flow Traders Ltd. and is for information purposes only. It is not a recommendation to engage in investment activities and you must not rely on the content of this document when making any investment decisions. The information in this document does not constitute legal, tax, or investment advice and is not to be regarded as investor marketing or marketing of any security or financial instrument, or as an offer to buy or sell, or as a solicitation of any offer to buy or sell, securities or financial instruments.
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Financial objectives are internal objectives of Flow Traders to measure its operational performance and should not be read as indicating that Flow Traders is targeting such metrics for any particular fiscal year. Flow Traders' ability to achieve these financial objectives is inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond Flow Traders' control, and upon assumptions with respect to future business decisions that are subject to change. As a result, Flow Traders' actual results may vary from these financial objectives, and those variations may be material.
Efficiencies are net, before tax and on a run-rate basis, i.e. taking into account the full-year impact of any measure to be undertaken before the end of the period mentioned. The expected operating efficiencies and cost savings were prepared on the basis of a number of assumptions, projections and estimates, many of which depend on factors that are beyond Flow Traders' control. These assumptions, projections and estimates are inherently subject to significant uncertainties and actual results may differ, perhaps materially, from those projected. Flow Traders cannot provide any assurance that these assumptions are correct and that these projections and estimates will reflect Flow Traders' actual results of operations.
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All results published in this release are unaudited.
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