Exclusive: Finotec revenues down 31% in 2019
FNG Exclusive… FNG has learned that FCA licensed institutional FX broker and brokerage services provider Finotec Trading UK Limited saw a 31% decline in Revenues during 2019. The company posted Revenues of £1.12 million in 2019, versus £1.63 million the previous year.
Despite the decrease, Finotec had a small net profit of £60,000 in 2019, down from £70,000 in 2018.
Finotec has helped brokers succeed by providing everything they need to operate an FX broker business as well as providing easy access for professional traders to a regulated trading environment. Serviced offered include Liquidity, Risk Management, Regulatory Compliance, and Managed Investment programs.
In recent years, Finotec has been transitioning its services to leverage on its Asset Management License, allowing for the management of client money traded either at Finotec or elsewhere.
The company stated:
“Our aim is to turn the focus of the company from a purely brokerage institute to offer investment services as well. Yedidya Capital Markets Limited (“YCM”), an Israeli research company with a long standing history developing technologies and risk management systems for the FX Industry, developed an exclusive trading algorithm and, in 2015, signed a distribution agreement with FTUK to offer this unique trading program to FTUK’s clients; as well as to introduce YCM’s client portfolio to FTUK’s brokerage services.”
Finotec operates as a matched principal broker.
The company’s minimum entry is currently set to $100,000, with clients paying an Execution fee of $15 per million. The immediate consideration for Finotec is a monthly transaction volume of more than $US1 billion for each $US1 Million AUM, which would generate an additional income of up to $15,000 (including price improvements) per month.
Finotec said its current target is to reaching $US20 million in total deposits by the end of 2020, which it believes will enhance the company’s income potential. We would note that Client deposits – Professional decreased during the year, and totaled £2.17 million as at year-end 2019 versus £4.03 million the previous year.
Management stated that it is also exploring a corporate transaction with YCM for the purpose of integrating the revenues generated from Management and Performances fees with Finotec.
Finotec is controlled by longtime Israel-based CEO Didier Essemini.
Finotec’s 2019 income statement and balance sheet follow: