- First half revenues rise 75% to £27.4 million
- Full year to beat market expectations
- Volatile currency markets provide tailwinds
Foreign exchange specialist Argentex (AGFX:AIM) said strong client demand had driven a 75% year-on-year increase in revenues to £27.4 million for the first half to 30 September.
As a result, the board said it was ‘confident in the group’s ability to exceed market expectations’ sending the shares up 14% to 103.5p.
Market expectations for revenues for the full year to 31 March 2023 sit at £42.8 million, representing growth of 24%, while earnings per share are expected to jump 37% to 9.3p according to data provider Refinitiv.
Prior to today’s stronger than expected first half trading update analysts had revised down their 2023 earnings estimates by around 14%.
Today's update suggests they need to go back to the drawing board and start revising up their forecasts fairly swiftly.
CURRENCY MARKET TAILWIND
The company said growth has been driven by its core proposition and a ‘disciplined approach’ to costs, while its overall performance had been aided by favourable market conditions.
The last few months have seen heightened currency market volatility typified by a strong trend in the US dollar against a basket of currencies.
The UK government’s disastrous ‘mini’ budget last month heaped even more pressure on the pound, which lost over 10% of its value in a week and almost touched parity with the dollar before rebounding.
Argentex chief executive Harry Adams commented: ‘While current market dynamics, specifically the historic lows in sterling, present exceptional short-term trading conditions, our long-term growth strategy and outlook remain unchanged.’
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