StoneX (SNEX) sees a 3% Q4 2023 decline in FX and CFDs revenue, citing reduced trading activity impact. CEO remains optimistic.
StoneX (SNEX) sees a 3% Q4 2023 decline in FX and CFDs revenue, citing reduced trading activity impact. CEO remains optimistic.
StoneX(SNEX), overseeing Forex.com and City Index, disclosed a 3 percent year-on-year decline in operating revenue from Forex and contract for differences (CFDs) contracts for the Q4 of fiscal 2023, concluding on September 30. The quarterly revenue from FX and CFDs amounted to $79.2 million, attributed primarily to a dip in trading activity.
Comparing annual figures, StoneX reported $261.9 million from FX and CFDs in FY23, marking a 23 percent decrease from the $339.3 million recorded in the previous year. However, the overall operating revenue of the group for the same quarter surged to $778 million, representing a 33 percent increase.
The decline in FX and CFDs revenue was attributed to a drop in trading activity, with the average daily volume (ADV) of FX and CFDs contracts for the quarter reaching $10.9 billion, down by 11 percent. This was notably below the annual ADV of $11.9 billion, reflecting a 10 percent reduction.
Based in New York, StoneX Group plays a prominent role in financial services, engaging in commercial hedging, global payments, securities, physical commodities, forex, and clearing services. Moreover, The company entered the retail FX and CFDs industry by acquiring GAIN Capital in 2020 for $236 million, gaining control of Forex.com and City Index.
StoneX reported a 10 percent decline in operating revenue in the retail sector for FX and CFDs contracts during Q4 2023, amounting to $67.8 million. The annual figure stood at $222.5 million, reflecting a 28 percent decrease. Quarterly and annual ADV figures for retail FX and CFDs contracts were $7.2 billion and $7.6 billion, respectively, down by 13 percent and 18 percent.
Despite the FX and CFDs revenue slump, StoneX Group achieved a 14 percent increase in quarterly pre-tax income, reaching $75.4 million. However, the net figure experienced a 3 percent decline to $50.7 million. Basic earnings per share decreased by 6 percent to $2.43.
StoneX Group’s CEO, Sean O’Connor, attributes the results to sustained client engagement and rising interest earnings on client float amid moderating volatility. Our diversified business model continues positioning us to deliver strong results to our shareholders in the current market environment.”
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