GKFX UK Narrows 2021 Losses despite 55% Trading Revenue Drop

[forex4you]

GKFX UK Narrows 2021 Losses despite 55% Trading Revenue Drop

<p>GKFX Financial Services Limited, the UK-based entity of Global Kapital Group, published its financials for the year 2021, ending on 31 December. Though the annual turnover of the broker from its trading business declined, it significantly narrowed its losses.</p><p>According to the Companies House filing, the broker generated £1.18 million in revenue from its FCA-regulated United Kingdom business. The figure dropped by more than 55 percent as it brought in £2.66 million in revenue in the <a href="https://www.financemagnates.com/forex/brokers/gkfx-sees-2019-revenue-decline-after-retail-clients-migration/" target="_blank">previous financial year</a>.</p><p>Its gross trading profits also declined to £509,798 from the previous year's £1.89 million.</p><p>The company cited market <a href="https://www.financemagnates.com/terms/v/volatility/" target="_blank" id="7fd330d9-8855-4c31-9770-cb52b328c117_1" class="terms__main-term">volatility</a> and global macroeconomic problems behind the downturn in its core business performance.</p><p>"Trading revenues for the year were generated predominantly through volume rebates with a counterparty that is related to <a href="https://www.financemagnates.com/tag/gkfx/" target="_blank">GKFX </a>by common ownership. The <a href="https://www.financemagnates.com/terms/r/risk-management/" target="_blank" id="aedb745c-adf9-415f-97e2-ee56a920f0f8_1" class="terms__secondary-term">risk management</a> strategy is based on highly automated flow management which dynamically hedges client exposures and risk," the filing stated.</p><p>"The level of such revenues is influenced by the volume of trades executed on behalf of the Company's clients [and its] success is driven by the variety of financial products it offers and the quality of services provided to customers."</p><p>Short-Term Non-Trading Income</p><p>Additionally, the UK company generated a non-trading revenue of £4.1 million by providing short-term services like procuring outsourced services and supplies to its counterpart.</p><p>Despite a higher administrative expense, the non-trading revenue helped to narrow the operating losses to £2.63 million, compared to £3.29 million in 2020. The pre-tax losses of the company came in at £2.24 million last year, narrowing down from £2.88 million.</p><p>"As a result of a number of strategic changes, commencing in 2019 and continuing through 2021, trading revenues and related expenses have continued to reduce significantly from historic levels," the filing added.</p>

This article was written by Arnab Shome at www.financemagnates.com.

Source: GKFX UK Narrows 2021 Losses despite 55% Trading Revenue Drop