Guernsey-based iFOREX Financial Trading Holdings Ltd has published a registration document ahead of the proposed flotation on the Main Market. The company wants to raise £5m and hopes for a market valuation of £50m.
iFOREX has an online and mobile contact for difference (CFD) trading platform, which it developed itself. Clients can trade in currencies, commodities, indices, cryptocurrencies, shares and exchange traded funds. The majority of trading is via mobile.
There are two regulated subsidiaries. Formula Investment House is based in the British Virgin Islands but operates via Greece. ICFD is based Cyprus and has been licensed on 23 May 2011. This subsidiary is used to accept clients from the European Economic Area.
The registration document states that clients are able to trade in CFDs linked to underlying instruments and leveraged provided is limited by regulation and the company’s assessment of specific risk. Argentex also insisted that it took appropriate action when it came to risk and this shows that investors should always be aware of the dangers of this type of business.
In the document the company says: “Extreme market movements or events, which the Group is unable to, or fails to promptly manage, could cause a material exposure or risk to the Group”.
Currencies account for 37% of trading and commodities 33%. Commodities include metals, energy and agricultural produce.
Revenues are generated via a dealing spread on trades. There are also fees on positions held overnight. There can also be gains and losses on client trading positions. The overnight fees can offset some of this risk.
Since 2014, the company has distributed £262m to shareholders. The plan is to pay 50% of earnings as dividends.
In 2024, trading income was $50.1m, slightly higher than in 2023 but well down on the 2022 level of $76.8m. That decline was due to competitiveness and the tightening of spreads, as well as a lower number of transactions. Asia is the biggest contributor to revenues.
In 2022, trading gains were $18.6m and they dropped to $6.24m in 2024.
In 2024, pre-tax profit was $6m, down from $7.57m in 2023, due higher overheads and interest charges. Management says that was partly due to pre-admission costs.
iFOREX wants to move into new markets and is seeking acquisition opportunities.