SPREAD TRADING company WorldSpreads has posted a 666 per cent jump in profits from the business it retained after selling its Irish division last year.
In results issued yesterday, the Dublin-based group said operating profits from continuing operations had risen from €0.4 million to €3.04 million in the year to the end of March.
The increase came as revenues from the same businesses climbed by 85 per cent to €12.89 million, and earnings per share increased from 0.2 cent per share to 5.7 cent. WorldSpreads handled an average of 6,148 trades per day during the year, up 41 per cent on the previous 12 months.
The firm’s chief executive Conor Foley described the results period as “a year of transition”, adding that the current year was about “investment for long-term growth” and thus could bring a temporary reduction in margins.
He said the €11 million the company received for its Irish financial spread-betting business last year had left WorldSpreads “on its strongest financial footing of any previous time in its history”.
The results show that the deal generated a profit of €5.5 million, while a portion of the consideration was deferred. The firm had cash of €13 million on its balance sheet at the end of March.
WorldSpreads drew €2.1 million in revenue from the divested Irish business during the year, but the results show it contributed an operating loss of €2.2 million before the sale.
Early indications of returns this year for WorldSpreads were “very favourable”, Mr Foley said. He flagged new business opportunities both in the UK and beyond.
Last month it formed a partnership that sees its services being sold to Ladbrokes customers, with Mr Foley describing this arrangement as “very positive”. Such “revenue-sharing” arrangements now provide more than half of group revenues, with similar relationships likely to emerge soon.
Financial spread betting dominated the firm’s activities during the year. A smaller financial derivatives business generated “unspectacular” returns. WorldSpreads is considering either “terminating” the division or restructuring it.
The Irish WorldSpreads business was sold to a team led by local management, who changed its name to MarketSpreads. Stockbroking firm Merrion Capital holds a 40 per cent stake. MarketSpreads reported “a significant uplift” in client numbers in the first half of this year and announced a number of appointments. Shares in WorldSpreads, listed in London, gained 0.75p yesterday, closing at 77.5p.
