- Broker is reducing headcount in Europe and North America
- Firm also said sales rose 13 percent to $1.1 billion last year
Tullett Prebon Plc, which is buying rival ICAP Plc’s voice-broking division, said it will reduce headcount in its interdealer business in Europe and North America by about 70 people, more than than the job cuts it announced in November.
The cuts, equivalent to 7.5 percent of front-office staff in the interdealer unit, will result in 25 million pounds ($36 million) of charges to the company’s 2015 accounts. Tullett Prebon will take a charge of less than 10 million pounds in 2016, it said in a statement on Friday. The firm also said revenue rose 13 percent last year to 796 million pounds.
“Actions have been taken to reduce headcount and fixed costs in the product areas most affected by the reduction in market volumes experienced during the year,” Tullett said.
Tullett announced in November that it expected to reduce the workforce in its interdealer business by about 5 percent. Interdealer brokers have struggled globally as their bank customers have scaled back fixed-income, currencies and commodities operations. Years of low interest rates have suppressed the volatility that typically benefits brokerages.
The company’s oil business picked up last year as the plunge in oil prices triggered convulsions in energy markets. The commodity is trading at about $34 a barrel, down from $100 two years ago.
Tullett’s shares rallied 8.2 percent to 340.9 pence at 8:55 a.m. in London, their biggest gain since the initial announcement of job cuts on Nov. 6.
In the last two months of 2015, Tullett’s sales rose 14 percent to 125 million pounds. Excluding PVM Oil Associates Ltd., revenue increased 4 percent. The company bought PVM, which primarily deals in petroleum products and crude oil, in 2014 for $160 million to help shore up earnings. It later purchased U.S. energy broker Moab Oil Inc. for about $27 million.