Despite reporting higher revenue, LMAX UK records net loss in 2023

LMAX UK, the UK-registered and licensed subsidiary of LMAX Group, released its financial report for 2023, alongside other Group’s subsidiaries. While their combined revenue saw growth in 2023 compared to 2022, the subsidiaries failed to achieve net profit due to growing administrative costs.

LMAX Financial Report For 2023 Highlights The Rise In Operating Costs

LMAX Limited stated that the LMAX Exchange saw a 5% increase in its trading volume in 2023 compared to 2022, ending the fiscal year with a total of $4.5 trillion. Meanwhile, Average Daily Volume went up to $17.4 billion, leading to the Compound Annual Growth Rate (CAGR) exceeding 10% over the past five years.

Next, the UK-based subsidiary of LMAX managed to boost gross revenues to £25.8 million according to the report, which is a notable increase from the previous year’s £24.1 million. A positive revenue was also reported by LMAX Broker Limited, which went from £21.9 million in 2022 to £25.9 million in 2023, achieving quite a sizable increase.

Combined, these two alone generated revenue of almost £52 million. But, as mentioned, growing administrative costs took their toll, resulting in a failure to achieve net profit. The report says that a decline in operating profit was also felt due to the growing costs. “”The economic outlook remains challenged, with the frailties caused by the pandemic intensified by geopolitical conflict, which has forced government policymakers, central bankers, and corporate leaders to contend with a unique variable on a scale not experienced in decades-”

LMAX Broker Limited reported a net profit drop from £3.2 million to only £1.8 million, while LMAX Limited’s results went from £0.6 million profit into the negative, resulting in a £2.6 million loss. Furthermore, the combined result for both subsidiaries shows a lack of profitability, while the losses exceeded £0.75 million.

In comparison, the entire LMAX Group saw a total net profit of £7.2 million during the same period. Last month, the Group released its results for H1 2024 too, reporting gross profits of $650 million, while its total EBITDA reached $20 million.

LMAX’s Major Moves In The Past 12 Months

A year ago, in October 2023, LMAX also managed to conclude its acquisition of a forex business of Curex — an institutional forex exchange execution services and data analytics company based in New York City.

Commenting on the matter, the company said that the combination of LMAX Exchange and Curex brought together the distribution scale and technical capabilities of both businesses, resulting in a stronger and more diversified firm liquidity.

The company also announced the acquisition of FX HedgePool just last week, noting that the acquisition will enhance its service range in the institutional swaps matching sector. Before that, it introduced FX Non-Deliverable Forwards trading in June 2024, and it also appointed a new lead for its digital asset custody growth strategy — a former Blockdaemon employee, Luke Dorney.