NEX Group has upped its targeted cost savings by £15 million after the financial technology company reported a fall in trading profits in the first half of this year.
Trading profit declined 16% from £75 million to £63 million according to the firm’s half-year results for the six months ending September.
Michael Spencer, NEX Group’s CEO, commented market conditions remained challenging with low volatility and volume in fixed income, currencies and commodities.
NEX Group explained it increased its cost savings target from £25 million announced in May to £40 million after identifying a further £15 million, which it plans to deliver over the next three years.
“Now more than ever before we’re focused on execution and delivering growth in revenue and earnings,” Spencer said. “We have identified a further £15 million of annualised cost savings in addition to the £25 million previously announced.”
NEX added the savings will be derived from the redesign of operating models in sales, product management, operation, technology and finance across the Group.
The total cost to achieve these savings will be approximately £16 million, which the firm said will not be treated as an exceptional item.
NEX Group posted a £6 million increase in trading profit in NEX Markets, although this was offset by a £7 million decline in NEX Optimisation trading profit.
The decline was driven by investments in the NEX Infinity platform and regulatory reporting services.
On the earnings call, NEX Group also announced it has chosen Amsterdam as its base for fixed income and repo trading in Europe following the UK’s decision to leave the European Union.