Strong dollar helps boost revenues at TP ICAP

TP ICAP Group reported a jump in quarterly revenues on Wednesday, boosted by the strong dollar.

The London-listed interdealer broker said total revenues in the three months to 31 March had strengthened 2% to £606m, or by 9% in reported currency.

Within that, energy and commodities revenues improved by 10% on the same basis, while global broking jumped 9%. Market conditions in European gas and power "continued to improve", TP ICAP noted, leading to an increase in revenue, although it did not provide a figure.

The one weak spot was its Liquidnet digital trading unit, where revenues fell 3%.

Looking to the rest of the year, TP ICAP said: "We remain well-positioned and expect interest rates to remain at elevated levels throughout the year. At the same time, the benefit of the recent strong US dollar is now moderating."

Vivek Raja, analyst at Shore Capital, said: "The first quarter represents 28% of our revenue estimate for the current year. The first quarter is typically TP ICAP's strongest, and if cable remains at the current level, a forex translation tailwind in the year to date becomes a headwind in the second half.

"With unchanged guidance, at this early stage we are not moving forecasts. The outlook is cautiously positive. Despite recent share price weakness, further disappointment in Liquidnet might weigh on the share price."

Shore has a ‘buy’ rating on the stock and a target price of 169p.

As at 1015 BST, the shares were trading 2% lower at 165.25p.