Successful execution of growth strategy and proactive risk management delivers strong growth in 2022, well-positioned for 2023
Marex Group (‘Marex’ or ‘the Group’), the diversified global financial services platform, today provides a trading update for the year ended 31 December 2022, based on unaudited results for the period, ahead of announcing its final results, anticipated at the end of March 2023.
Strong delivery in 2022
It is anticipated that Group net revenue for the year ended 31 December 2022 will be up c.29% to approximately $698 million and Operating Profit Before Tax up c.50% to approximately $120 million.
Marex delivered another year of exceptional performance, driven primarily by organic growth from increased client activity across the global franchise and strong commercial execution in Marex’s core energy and commodity markets. This performance reflects the agility and resilience of the business and demonstrates its ability to respond to external events and proactively manage risk to support clients through a period of significant market volatility.
The acquisition and consolidation of ED&F Man Capital Markets also contributed to performance in the final quarter of the year. Client monies increased significantly and are anticipated to be approximately $13 billion as at the end of 2022 (2021: $5.4 billion).
Robust revenue generation and the increasing scale of the business resulted in Operating PBT margins increasing to c.17% (2021; 15%), delivering an improved return on equity1 of c.17% (2021; 14%).
This record performance increases Marex’s growth trajectory and represents the ninth year of consecutive growth for the Group, with an average annual Operating PBT growth of c.29% since 2014.
Capital and Liquidity
Marex maintains a robust capital position, with regulatory capital increasing significantly to approximately $500m as at 31 December 2022 as a result of the strong profitability of the Group during the year and the successful issuance of $100m AT1 capital in June 2022.
Marex anticipates that the total capital ratio2 as at 31 December 2022 will be over 200% whilst also maintaining liquidity headroom of over $600m at year end.
As a result of the robust capital and liquidity position, Marex Group plc’s investment grade credit rating was reaffirmed by S&P and Fitch during the year ended 31 December 2022.
Delivery against strategic priorities
Good progress has been achieved against the Group’s strategic initiatives during the year, further expanding our product offering and global footprint to deliver growth and diversification. The Group has further invested in its environmental products offering, which is seeing strong demand from clients as they navigate the energy transition and Marex’s innovative carbon sequestration venture, in partnership with OxCarbon and Global Mangrove Trust, produced its first offsets during the year.
Marex continued to build out its Neon client portal, where the number of users increased around 25% during the year to approximately 10,000, demonstrating the value of Marex’s market insight and its ability to engage clients.
Marex has successfully completed the acquisition of the ED&F Man Capital Markets business across the UK, US, Middle East and Australia. The acquisition materially enhances Marex’s client offering, expanding the Group’s global footprint in the Middle East and across the APAC region, and creating a leading franchise in the US. The acquisition builds on Marex’s track record in identifying and integrating high-quality businesses, adding scale and capabilities that complement its organic growth trajectory.
Well positioned for 2023
Following another year of strong growth and with an expanded global operating footprint and larger revenue and capital bases, the Group is very well positioned going into 2023. The external environment remains supportive for Marex, with continued market volatility and rising interest rates anticipated to contribute towards future growth.
Marex is confident that it can continue to deliver on its ambitious strategy of broadening its product offering and expanding its geographic footprint to increase client reach and drive sustainable growth.
Ian Lowitt, Marex CEO, commented:
“We are delighted with these record results. The strong revenue growth reflects the increasing demand from our clients, who recognise our deep expertise and ability to deliver quality service and solutions.
“We remain focused on our strategic growth initiatives, which are diversifying our business by adding products to our service segments and expanding geographically. A particular highlight this year has been the acquisition of the ED&F Man Capital Markets business, which materially expands our footprint, expertise and clients across the world.
“This is a very exciting time for Marex, and I’d like to thank our people for their commitment to delivering excellent service for clients through a volatile year. The outlook for Marex is very strong, and I am confident that we can continue to deliver sustainable growth and build an even more competitive and resilient firm.”
Notes;
1 – Calculated as Operating PAT, less AT1 coupon paid in the period, divided by average shareholder equity
2 – Calculated as total capital resources divided by the transitional capital requirement under IFPR
Forward-looking statements
This trading update contains certain forward-looking statements about the future outlook for the Group. Although the Group believes that these statements are based upon reasonable assumptions, any such statements should be treated with caution as future outlook may be influenced by factors that could cause actual outcomes and results to be materially different. All financial information for the financial year ended 31 December 2022 which appears in this trading update is unaudited and is subject to upwards or downwards revision in the audited consolidated financial statements of the Group for the year ended 31 December 2022.
Enquiries please contact:
Robert Coates
+44 (0) 7880 486 329 | rcoates@marex.com
Nicola Ratchford
+44 (0) 20 7856 4617 | +44 (0) 7786 548889 | nratchford@marex.com
Tristan Peniston-Bird / Katherine Bell (FTI Consulting)
+44 (0) 7772 031 886 / +44 (0) 7976 870 961 | marex@fticonsulting.com
