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Nex Group earnings nudge higher at start of key year

Rising prospects of US interest rate rises helped Nex Group, the UK trading and technology provider, record a small rise in full-year earnings on Monday.

The group, the rump of the sale of ICAP’s broking business to rival Tullett Prebon for £1.3bn, said associated volatility in the US Treasury and Asian currency derivatives markets had offset softness in cash foreign exchange trading.

For the year to March 31, revenues rose from 18 per cent to £543m, and 8 per cent on a constant currency basis. Trading pre-tax profits rose from £110m to £114m. Trading operating profit rose 4 per cent to £145m.

Michael Spencer, chief executive, said the group’s priorities for the financial year included raising the operating margins of its two divisions, which cover trading and post-trade services, to at least 40 per cent.

The results cover a transformational year for Nex in which it sold its 1500 brokers to focus on electronic trading and markets infrastructure. Shares in the group have risen nearly 30 per cent this year on speculation the group, worth £2.2bn, could be a target for either the London Stock Exchange Group or Deutsche Börse following the collapse of their merger.