TP Icap Shares Soar as Broker’s Earnings Rise on Rising Commodities
- Shares of TP Icap rose more than 12% on Wednesday after the company released half-year figures.
- Equity cash is dwindling, but energy and commodities are doing well
TP Icap shares rose sharply after the group posted better-than-expected first-half figures as a rise in commodity prices helped offset lower equity earnings.
The brokerage group’s underlying profit was £163m, up 15 per cent year-on-year and higher than Shore Capital’s £156m estimate.
Its interim dividend rose 7 percent to 4.8 pence, higher than the 4.55 pence expected. Revenue increased 5% yoy to £1.13bn, in line with forecasts.
Shares rise: TP Icap shares have risen more than 27% in the last 12 months
The FTSE 250-listed broker also today announced a £30m share buyback programme.
Shares of TP Icap rose 7.38 percent, or 11.40 pence, to 165.90 pence this afternoon, having risen more than 25 percent in the past year. The stock price jumped more than 12 percent this morning.
The company enjoyed strong performance from its energy and commodities arms, with revenue rising 12 percent as markets normalized following Russia’s invasion of Ukraine.
Chief Nicolas Breteau said: “We see continued strong demand for oil and natural gas, key segments for our business.”
The group said it saw trading in its environmental division, which covers carbon credits and metals for batteries, as a “significant diversification opportunity” as the energy transition progresses.
At Liquidnet, the group’s equity trading arm, revenue fell 6 percent amid a drop in block market volumes. The currency and money markets gained in single digits.
Breteau said: ‘Equity markets were challenging again.
‘While there were some improvements in stock market performance, many institutions maintained a ‘risk off’ approach.’
In May, Fusion Digital Assets, TP ICAP’s digital asset spot trading venue, went live when it completed a bitcoin-to-dollar transaction for the first time.
Breteau, said: ‘It has been an eventful period for the emerging digital asset sector, especially given the well publicized crashes in the retail sector. As we focus solely on the institutional market and operate a segregated model, we expect to benefit from this trend.
“We also see opportunities in the tokenization of various asset classes, particularly bonds,” he said, adding that “this space was being worked on.”