Dukascopy – Swiss forex broker and bank – has published its Annual Report for 2016 (you can find the original report here), bringing some disappointing number for the market.

The STP broker reported that for the full year 2016 Revenues were down 5% from 2015, coming in at CHF 33.2 million (and with the USD and CHF trading now roughly at par, that makes conversion to USD fairly easy: $33.2 million. We’ll continue using the company’s CHF reporting currency in this article).

While the company did not directly report the semi-annual breakdown, our analysis shows that the broker had a much weaker second half of the year – unlike the two previous years in which 2H activity outstripped 1H. Revenues in 2H-2016 were CHF 16 million, down 7% from 1H. In fact, the second half of 2016 was Dukascopy’s slowest period revenue-wise since late 2014.

Swiss broker also reported a sharp drop in client deposits to CHF 118.1 million, down 18% from CHF 144.5 million last year.

On the bottom line Dukascopy still turned a profit in 2016 of CHF 2.5 million, down from CHF 3.4 million in 2015. The entire profit was earned during the first half of 2016, with Dukascopy breaking even in the second half of the year.

While the company didn’t give a direct explanation for the weaker second half results, it did drop some hints. Dukascopy stated that due to its focus on Dukascopy Japan’s successful integration, geographical expansion projects were put on hold during 2016. Dukascopy Japan is still losing money, with the company stating that it is confident that the Japanese subsidiary will reach financial equilibrium in 2017.

Dukascopy also reported its ‘regret that increased marketing budget did not pay off as expected during the year’, with the lower results coming despite an increased marketing spend.

Dukascopy was founded in 2004 by husband and wife team Andrey and Veronika Duka, who continue to own 99% of the company. The pair also act as co-CEOs of the company, after the departure of longtime CEO Alain Broyon in 2014.

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