Wed 21 Jun 2017 07:23

Global Risk Management posts record earnings in 2016-17


Fuel risk management specialist achieved a 75% increase in pre-tax earnings.



Global Risk Management - part of United Shipping & Trading Company (USTC) Group - reports that it managed to surpass last year's record earnings result during the 2016-2017 financial year, which runs up until April 30.

The Denmark-based firm, which specializes in fuel risk management solutions, achieved its best ever earnings before tax figure of $12.03 million - surpassing the previous year's result of $6.85 million by 75 percent.

Gross profit for the year rose by $4.67 million, or 29.7 percent, to $20.37 million.

The average number of monthly trades performed for clients increased by more than 40 percent compared to last year, and was up by more than 350 percent compared to four years ago.

Meanwhile, business volume rose by 100 percent compared to the previous financial year.

Commenting on the results, managing director Hans Erik Christensen said: "This year's result is extraordinary, especially since we are operating in a low-margin market environment. However, we have managed to expand the client base, especially in Europe, Scandinavia, Asia and the Middle East. Furthermore, we have a fairly even distribution of clients in our business areas shipping, aviation, suppliers and industrial companies, which makes us less vulnerable to economic downtrends in one or more of the business areas."

Christensen added: "Heading into the financial regulation, MIFID II, it is of great importance that our company has managed to obtain solid growth in terms of turnover, gross profit and generally increasing business activities. As the regulation authorities have strict requirements to our financial position, the 2016/17 result strengthens our position in that respect. Our team of employees are extremely dedicated and have all worked hard to deliver the very satisfying result. It is in our nature to add value to our clients while also continuously looking into optimising our own business; always considering if we can do things smarter, faster or better, to the benefit of both our clients and ourselves."

MIFID II regulation

The company notes that it has worked with external advisors for two years and implemented additional IT systems and procedures in preparation for the coming compliance to Markets in Financial Instruments Directive II (MIFID II) - the EU's legal regulation for financial companies from January 2018.

"Being subject to the regulation enhances Global Risk Management's ability to extend the portfolio of client services - from initial contact to detailed overview of trades and positions via new, improved IT systems. The process towards becoming a regulated company has required considerable resources both as regards employees as well as financial in the form of investments in supporting IT systems and physical office setup changes to comply with MIFID II regulation," the Danish firm said.

Contribution to growth

Global Risk Management explained that its offices in Copenhagen, Middelfart and Singapore all contributed to the company's growth, whilst the Unitrading team - the company's internal trading desk - is said to have added "great value for clients as well as colleagues".

"The year has brought consolidation of the teams - adding more skilled employees and building a sense of unity - enhancing the one global team spirit which is an important company value. One global team also means that clients get the same optimum service no matter what team they are in touch with, and that the employees help each other at all times," the company noted.

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