CMC Markets lifts FY net operating income outlook, shares rocket

(Sharecast News) - CMC Markets rocketed on Thursday as it lifted its outlook for full-year net operating income after a better-than-expected first half and a particularly strong performance in Australia. In the six months to 30 September, net operating income rose 5% from the same period a year earlier to £186.2m, with total revenue up 5% to £196.7m.

Pre-tax profit dipped 1% to £49.3m, which the company attributed mainly to the impact of a £5.2m remediation provision in Australia relating to an industry-wide margin netting matter.

CMC hailed strong growth through its retail and B2B divisions. It noted that retail client cash balances are at record highs and growing exponentially, pointing to strong tailwinds for the second half, which is traditionally the strongest half of its financial year.

It also pointed to continued traction from its expanding network of B2B partnerships.

"Performance in Australia was particularly strong, with record half-year income from the stockbroking business supported by double-digit growth in assets under administration, turnover volume and active accounts," it said.

As a result, and following a strong start to the second half, CMC now expects net operating income to be about 10% ahead of current market expectations of £353.9m for FY2026.

At 1220 GMT, the shares were up 29% at 269.08p.

Broker Shore Capital lifted its recommendation on CMC Markets to 'buy' from 'hold' after the update and upped its price target to 330p from 280p.

It said: "CMC has published interim results where the outlook is significantly better than we expected, whilst H2F is off to a strong start.

"Today's statement shows how the significant investment CMC has made over the past few years is now beginning to bear fruit in terms of earnings contribution, whilst showcasing CMC's impressive technological capabilities, which provide optionality for future growth."