WorldSpreads predicts full year loss in trading update

Financial spread betting operator WorldSpreads Group anticipates making a loss for the full year ending 31 March 2012 and has announced the resignation of CFO and director Niall O’Kelly after eight years with the group.

The prediction comes despite strong growth in its key performance indicators, with transaction volumes increasing by more than 60% in the year ending 31 January 2012, with active client numbers increasing 35%, and new clients up 40% year-on-year. WorldSpreads did not break out any figures in the trading update.

The board admitted that these improvements have not translated into revenue growth since 1 January this year, blaming low market volatility, benign market conditions and unusual client trading patterns.

Group CEO Connor Foley said he was disappointed by the weak revenues: “Despite the successful implementation of our sales and marketing campaign, improving performance from our new overseas operations and the successful cost management structures in place, we are disappointed to report that revenues for the second half of the group’s financial year ended 31 March 2012 will be behind our previous expectations.

“Market conditions since 1 January 2012 have been such that, whilst transaction volumes have been high, revenues have not increased at the same pace,” Foley explained.

The group launched its new mobile trading platform at the beginning of this year, with its proprietary contract for difference (CFD) trading platform expected to go live early in March. WorldSpreads has also expanded into new territories, claiming to have seen strong growth in France and Germany, and recently opened an office in Tel Aviv.

The trading update also announced O’Kelly’s resignation after eight years as group CFO. O’Kelly, who has a year-long notice period, joined from furnace manufacturer Magnetic Solutions in 2003, and will continue to work for the group until a suitable replacement is found.