TP ICAP Group plc

Ladies and gentlemen, and welcome to the TP ICAP Group's interim results presentation. At this time, all the participants are in listen-only mode. Later, we will conduct a question and answer session. If you wish to ask a question, we ask that you please use the raised hand function at the bottom of your Zoom screen. If you have dialed in, please press star 9 to raise your hand and star 6 to unmute. Instructions will also follow at the time of the Q&A. I would like to remind all participants that this call is being recorded. Questions will follow after the presentation. I will now hand the call over to Nicola Bresso, the Group CEO to start the presentation. Thank you.

Good morning everyone and thank you for joining us. This is our agenda today. I start with the highlights. Robin will take you to the financial results I then look at the operational performance of each division and wrap up before we take questions. So let's start with the headlines where growth rates are in constant currency. We have delivered a strong first half. Group revenue increased 8% to 1.3 billion with an excellent performance from global broking and disciplined execution across the group. Group adjusted EBIT grew 9% to $196 million and we are proposing an interim dividend of 5.6 pence, an increase of 8%. We've also announced another share buyback of $30 million today. This takes total distributions announced since 2023 to around $660 million, including $110 million of buybacks this year. In addition, we have made good progress on strategic initiatives with the completion of our Vantage Capital Markets acquisition, which adds to our capabilities in Asia Pacific. The launch of our new dealer-to-crime credit platform, RealQ. And excellent progress on transformation plan, where we now expect to exceed our 2027 target a year early. This strong performance shows are we benefiting from successful execution of our three strategic priorities. Diversification, transformation, and dynamic capital management. This strategy has served us well and we now plan to build on it with an emphasis on medium-term revenue growth. Over the next five years, we aim to capitalize on key competitive advantages. First, as an industry leader, we have a unique position at the heart of vast and growing over the counter markets. Second, we have built a diverse business. We serve a broad client base including both the sell side and the buy side. We operate in every major asset class in each region across the world. Third, we've invested in technology to create a scalable market infrastructure platform. Fourth, our value proposition is compelling and is built on strong client relationships. Clients know they can rely on our impartiality along with deep liquidity unique market insight and seamless execution. And fifth, despite our scale, we have additional opportunities to grow organically through products and geographic expansion or via acquisitions. Our ambition is to capitalize on this key strength to drive additional growth and operating leverage. This underpins our commitment to maximize shareholder value over the medium term. So now let me hand over to Robin to take you through the results in detail.

Thank you Nico and good morning everyone. I'll start with the headlines in constant currency. We delivered a strong first half performance. Total revenue grew 8% to 1.3 billion with excellent growth of 11% in global broking. Adjusted EBIT was up 9% at 196 million as we maintained good cost discipline and the Group adjusted EBIT margin increased to 15.2% with a 3% uplift in productivity. Basic adjusted earnings per share grew 10% to 19.3 pence and as you've heard from Nico we've announced an interim dividend of 5.6 pence up 8% together with another share buyback of 30 million. Turning to the Group Income Statement. Net finance cost decreased slightly to 16 million and the effective tax rate was 27%. We delivered adjusted earnings of 140 million before significant items up 8%. Significant items were 36 million as we accelerated investment in our transformation plan to unlock cost efficiencies. Let's turn now to the year-on-year movement in earnings before interest and tax. Adjusted EBIT increased from 180 million last year to 196 million this year. We have restated last year's results using 2026 exchange rates to give the basis for a like-for-like comparison without the impact of foreign exchange. Contribution increased by 22 million and we also benefited from 2 million of front office savings from our transformational plan. back-office savings of 4 million offset inflation, high national insurance contributions and ongoing investment in the business. As a result, net management and support costs are broadly unchanged, turning next to the business divisions where growth rates are shown in constant currency. Revenue in global broking increased 11% to 783 million with our scalable electronic platforms driving higher levels of client engagement and trading activity in supportive market conditions. Adjusted EBIT increased 22% to 159 million and the margin improved from 18.4 to 20.3%. Revenue in energy and commodities of 233 million was up 2%. The adjusted EBIT margin was around 10% in the first quarter, but performance was impacted in the second quarter when conflict in the Middle East dampened activity. As you know, this business made a number of key hires and invested in broker retention in 2025. These additional costs impacted the division's adjusted EBIT, which decreased from 26 to 12 million. This investment positions the division well for future revenue growth and we expect this to feed through when markets recover. In LiquidNet, revenue of $194 million was broadly stable as growth in cash equities was offset by a decline in the multi-asset business against a strong prior year comparator. Adjusted EBIT was also stable at $32 million with a margin of 16.5%. Finally, Parameter Solutions revenue grew 6% to $102 million. The adjusted EBIT margin was 35.3% reflecting planned investment with an improved trend in the second quarter which we expect to continue in the second half. We are transferring certain agency and digital asset activities between divisions to better align and enhance performance. We'll update you on this at the third quarter. Now let's look at cash flow. There was an operating cash outflow of 77 million compared with an inflow of 24 million a year ago. Around 70% of this is due to a change in net settlement balances CAPEX increased by 6 million to 42 million largely due to office fit out costs in our hubs in manila and belfast we also acquired vantage capital markets for a cash consideration of 22 million paid dividends of 88 million and almost completed the 80 million share buyback announced in march the group's net cash balance was 652 million at the end of june compared to 903 million at the year end Turning now to our transformation plan. As you heard from Nico, we now expect to exceed our 2027 target a year ahead of schedule, delivering at least 50 million in annualized savings by the end of this year. This acceleration is reflected in significant items, which I'll cover on the next slide. We've also identified around 15 million of additional savings which we expect to execute in 2027 at no more than one times cost. We'll provide more detail at the full year. As a result of simplifying our business, improving efficiency and unlocking cash from the balance sheet, we are announcing another share buyback today. Any potential returns in the future will be supported by earnings generation. Turning to significant items. These are not included in our adjusted results so we can measure underlying business performance and make more meaningful year-on-year comparisons significant items before tax increased by 1 million to 45 million almost half were non-cash including 18 million for the amortization of intangible assets restructuring and related costs increased by 5 million as we accelerated delivery of our transformation plan and disposals acquisitions and investment reduced by 9 million turning now to our 2026 outlook We expect to achieve adjusted EBIT in line with current market expectations, subject to foreign exchange. We also expect group net finance expense of around 35 million, an effective tax rate of around 27% and significant items of around 80 million before tax, excluding legal and regulatory matters. This is around 10 million higher than previously indicated, reflecting the accelerated delivery of our transformation plan. I'd like to conclude by looking at the medium term you can see here how disciplined execution of our strategy has resulted in a strong track record of growth and increasing operating leverage since 2021 we have delivered compound growth in revenue of more than five percent and adjusted EBIT of nine percent our priority now is to invest in growing our business and delivering against our medium-term ambition for mid-to-high single-digit revenue growth. We will maintain the flexibility to pursue value-accretive acquisitions and will look to return excess cash, not required for other purposes, via share buybacks. With that, I'll now hand you back to Nico.