IG Group Holdings plc has released its first quarter revenue update for the three months ending August 31, 2023. The company reported total revenue of £242.9 million, with a solid performance driven by strong client retention rates and high levels of client money balances. While there was a decrease in net trading revenue due to lower volatility, this was offset by growth in interest income. The company's business diversification strategy over the past few years has helped to mitigate the impact of softer market conditions.
In terms of product revenue, OTC derivatives revenue decreased by 8% to £182.7 million, while exchange traded derivatives revenue increased by 37% to £49.8 million and stock trading and investments revenue increased by 61% to £10.4 million. Within the Core Markets+ portfolio, total revenue decreased by 6% to £188.7 million, reflecting softer market conditions. However, the High Potential Markets portfolio saw strong growth, with tastytrade achieving a record level of quarterly total revenue, increasing by 48% to $60.0 million.
IG Group reported a total of 267,000 active clients in the quarter, a resilient performance reflecting the quality of its clients and its ability to engage and retain client cohorts through superior technology and customer service. Total client money balances remained stable at £4.1 billion, indicating continued interest in trading financial markets.
The company also provided an update on its capital position. It announced a £250 million share buyback program in July, with the first tranche of £100 million already underway. As of September 12, approximately 5.9 million shares have been repurchased at a cost of £39.6 million. The company's regulatory capital requirement reduced from £497 million to £290 million following its first Supervisory Review and Evaluation Process under the new Investment Firm Prudential Regime.
Looking ahead, IG Group remains confident in achieving its medium-term targets and is focused on driving greater cost efficiency. The company is also in the process of searching for a permanent CEO. The next scheduled market announcement will be the half-year FY24 results in January 2024.