Compagnie Financière Tradition - Revenue of CHF 1,210.4m, Underlying operating profit: CHF 89.6m
18.03.11 07:35

Compagnie Financière Tradition reported consolidated revenue of CHF 1,210.4m in 2010 against CHF 1,352.7m in 2009, a decline of 7.6% at constant exchange rates. Activity in the second half of 2010 was down 4.9% at constant exchange rates compared with the year-ago period. It was impacted by a sharp slowdown in business at Gaitame.com, a Japan based operating company which runs an online FX trading platform for retail investors. Consolidated revenue on interdealer broking business (which excluded Gaitame.com) was down slightly by 1.1%, at constant exchange rates compared with the second half of last year, but was stable compared with the fourth quarter.
 
Consolidated operating profit was CHF 52.1m in 2010 (2009: CHF 120.1m). It includes an amortisation charge of CHF 20.3m (2009: CHF 20.4m) on an intangible asset, which will end in April 2011, as well as other net exceptional costs (including reorganisation costs) of CHF 17.2m (2009: CHF 10.2m). Excluding these items, the consolidated underlying operating margin was 7.4% of consolidated revenue. The 2010 operating result was also affected by the business slowdown at Gaitame.com. This compares with operating results in 2009, which benefited from gains of CHF 32.0m, realised on the disposal of interests by Group companies.    
 
The underlying operating profit on interdealer broking business in 2010 was up 3.4% at constant exchange rates compared with the prior year. In the second half, it was up 59.6% compared with the year-ago period. The Group benefited from its strategic position in certain regional markets with strong potential, such as Asia, and its cost-cutting programme, in the Americas in particular.  The cost reduction programme resulted in gross savings of CHF 33.5m being recognised in 2010, for an annualised amount of CHF 53.2m. Elsewhere, the Group pursued its specific investments in selected groups of products for an annualised amount of CHF 23.2m (of which CHF 15.5m in 2010). The net annualised savings represent CHF 30.0m.
 
Profit before tax on continuing activities was CHF 70.0m, against CHF 124.2m in 2009, giving a pre-tax return of 5.8% compared with 9.2% in 2009. This result included negative goodwill of CHF 17.8m recognised on the acquisition of CM Capital Markets Holding SA in Madrid, which gives us a strategic position in Brazil. This acquisition is awaiting formal non-opposition from the Spanish financial markets regulator in April 2011.
 
Consolidated net profit was CHF 50.3m in 2010, compared with CHF 78.8m a year ago,
 
Group share of net profit was CHF 40.9m, down from CHF 65.0m a year ago, bringing consolidated equity to CHF 382.1m at 31 December 2010, CHF 318.1m of which was attributable to shareholders of the Company.
 
At the Annual General Meeting to be held on 7 June 2011, the Board will be seeking shareholder approval to pay a dividend of CHF 5.0 per share.
 

Outlook

Compagnie Financière Tradition's consolidated revenue for the first two months of 2011 was up 5.0% at constant exchange rates, compared with the same period a year ago, while global activities rose 0.8%. In 2011, the Company intends to continue to maintain a strong focus on cost management. It will also pursue its initiatives surrounding the launch of the Trad-X hybrid trading platform, with the support and participation of eight major banks, as announced on 15 March. 
 
With a presence in 27 countries, Compagnie Financière Tradition SA is a leading interdealer broker (IDB) in the international market. The Group provides broking services for a complete range of financial products (money market products, bonds, interest rate, currency and credit derivatives, equities, equity derivatives, interest rate futures and index futures) and non-financial products (energy and environmental products, and precious metals).
 
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