Compagnie Financière Tradition registers drop in profits in 2021
Swiss interdealer broker Compagnie Financière Tradition today posted its financial results for 2021, with profits marking a drop from 2020 levels.
The year 2021 was marked by a period of normalization of activity in two stages. Indeed, after a decrease in the first half of 2021, to be put into perspective with the exceptional volume of activity in the first half of 2020 resulting from the gradual health crisis and the very high volatility in the financial markets, the Group’s activities progressed in the second half of 2021.
For the full year 2021, the Group’s consolidated adjusted revenue was CHF 950.8 million compared with CHF 981.2 million in 2020, a decrease of 2.5% at constant exchange rates. The adjusted revenue from interdealer broking business (IDB) was down 2.8% at constant exchange rates to CHF 917.0m while the Forex trading business for retail investors in Japan (Non-IDB) presented an increase of 3.8% to CHF 33.8 million.
Adjusted operating profit before exceptional items was CHF 99.9m against CHF 111.0m in 2020, down 8.0% at constant exchange rates for an operating margin of 10.5% and 11.3% respectively. Net exceptional costs represented CHF 5.8m down from CHF 10.5m in the previous year.
The Group reported consolidated revenue (IFRS) of CHF 873.6m for 2021 against CHF 903.0m in 2020, down 2.9% at constant exchange rates.
Reported operating profit was CHF 73.2m compared with CHF 84.1m in 2020, down 10.6% at constant exchange rates for an operating margin of 8.4% against 9.3% in the previous year.
Net financial expense was down to CHF 10.8m in 2021 compared with CHF 14.4m in 2020. Net foreign exchange results due to exchange rate fluctuations negatively impacted the Group’s financial result and represented a loss of CHF 1.7m for the year against CHF 3.8m in 2020. Interest expense on bank borrowings and bonds, net of interest income from short-term cash investments, totalled CHF 6.5m from CHF 7.6m in the previous year.
The share in the results of associates and joint ventures was CHF 22.6m against CHF 17.2m in 2020, up 33.8% at constant exchange rates.
Profit before tax was CHF 85.0m compared with CHF 86.9m in 2020. The Group’s tax expense amounted to CHF 13.5m against CHF 12.3m in 2020 for an effective tax rate of 22% against 18% in the previous year.
Consolidated net profit was CHF 71.5m compared with CHF 74.6m in 2020 with a Group share of CHF 65.3m against CHF 70.9m in 2020, down 5.5% at constant exchange rates.
At the Annual General Meeting to be held on 24 May 2022, the Board will be seeking shareholders’ approval to pay a cash dividend of CHF 5.0 per share (yield of 4.7%1). In addition, a distribution of treasury shares will also be proposed with one share distributed for each 100 shares held partially paid from capital contribution reserve (yield of 1.0% or CHF 1.11).