StoneX Reports A Decrease in FX/CFD Operating Revenue

StoneX Group Inc., the international brokerage listed on Nasdaq has announced its Q1 2023 financial results. These financials cover the period from October to December 2022. Although the company reported an overall revenue fall of 9% to $13 billion in this period, its operating revenue still increased by 45% and came out to be $654.8 million.

Additionally, net income for Q1 Fiscal year 2023 came in at $76.6 million. This also means an increase of 84% compared to Q1 FY2022. StoneX’s return on equity, known as ROE, also improved by 27.3% in the fiscal year. Its diluted earnings per share (EPS) jumped by 77% to $3.62 per share.

StoneX Reports Decreased FX/CFD Contracts Operating Revenue

The firm’s financials show that the operating revenue from FX/CFD contracts decreased by 32% to $48.8 million in the final quarter of 2022. The same figure stood at $72.2 million in the same period of 2021. The decrease was primarily due to a 27% decline in FX/CFD contract RPM. Operating revenue from OTC derivatives dropped 9% to $42.5 million, compared to $46.7 million in the same period of the previous year, resulting from a 6% decline in OTC derivative contract volumes.

Operating revenue from listed derivatives also saw a sharp decline. It decreased from 1% to $99.8 million. This was primarily due to an 11% decline in the average rate per contract.

StoneX CEO Lauds The Increase In Net Income And Operating Revenue

Sean M. O’Connor, the CEO of StoneX, stated that the company achieved strong results in the first quarter of 2023, with increases in operating revenue and net income. This resulted in a diluted EPS of $3.62 and a Return on Equity (ROE) of 27.3%. The strong results were attributed to the company’s disciplined approach to acquisitions like GAIN Capital.

Although the operating revenue from FX/CFDs contracts showed a significant decrease of 32% compared to the previous year, the overall increase in net income is quite a positive sign. The company highlighted a 27% decline in FX/CFD contract RPM and a drop in retail demand as the main reasons behind the significant drop in revenue from this category. Despite this, the CEO remains optimistic about the company’s future, citing an increase in overall operating revenue and ongoing investments.