According to the statement, ICAP’s markets continue to display strong, long-term structural growth with an underlying, medium term industry revenue growth rate estimated to be at least 10% per annum.
This structural growth rate covers both periods when volatility and volumes in the wholesale financial markets can be very high and also quieter periods when these markets are more subdued. Overall, the period from 1 October 2007 has had higher than average levels of volatility and consequently, ICAP’s revenue for the year to date is significantly ahead of last year.
“ICAP has continued to perform very well and we remain very positive about the outlook for the business. As a result of continuing volatility in interest rates, foreign exchange, energy and parts of the credit markets over the period we saw increased volumes in both electronic and voice broking, boosting ICAP’s revenues. Following the normal slowdown in December we have seen most of our markets return in January to the higher levels of activity we experienced between June and November 2007.
“We have continued to make significant investments in our electronic systems providing further service improvements to our customers and enabling us to handle record volumes.
“Steeper yield curves, volatility in foreign exchange and continuing activity in the credit markets suggest that this period of increased activity may continue for some time,” says Michael Spencer, CEO, ICAP.
Trading across the group since September 2007 has been strong and profit for the financial year ending 31 March 2008 is anticipated to be above the current consensus of analysts’ forecasts.