HYCM Capital Markets (UK) Limited swung to a net loss of £236,304 for the year ended December 31, 2025, reversing a £1.25 million profit a year earlier, as administrative expenses more than doubled and a one-time gain that flattered the prior comparison dropped out, according to the company's annual report filed with Companies House.Singapore Summit: Meet the largest APAC brokers you know (and those you still don't!)The London-based unit of the wider HYCM group, posted revenue of £981,137, up roughly 3% from £950,775 in 2024. Administrative expenses, however, jumped to £1.30 million from £580,908, sending the prior year's £373,024 operating profit into an operating loss of £323,665.Currency Swing Drives the HYCM UK ReversalThe bulk of the cost spike was foreign exchange. The income statement shows exchange losses of £419,281 in 2025 against exchange gains of £283,433 in 2024, a swing of more than £700,000 that overwhelmed the modest revenue uptick. Stripped of FX movements, administrative costs were broadly stable.The company itself flagged the dynamic. The Board described the year as "satisfactory" at group level but said administrative expenses "were adversely affected by exchange rate differences during the year, resulting in an operating loss," according to the report signed by director Marcin Swanson-Zając.The 2024 comparison was further distorted by a £972,102 fair value gain on a disposal, tied to the sale of the firm's Dubai subsidiary HYCM Limited to its own management duo for £1.4 million. Without that gain, prior-year profit before tax would have been around £374,000. The 2025 results carry no such offsetting item, and the Strategic Report's headline measure, return on net assets, fell to zero from 34.2% the year before.Cash Builds Even as Profit FallsThe balance sheet drew sharply on related parties. Amounts owed to group undertakings rose to £3.25 million from £704,925 a year earlier, with the parent group providing written assurance that £2.66 million owed to HYCM DMCC would not be called in for at least 12 months. Cash at bank grew 76% to £5.12 million from £2.91 million.Own funds stood at £3,419,051, well above the £750,000 minimum required under the Financial Conduct Authority's Investment Firms Prudential Regime. Headcount slipped to five from six, while aggregate remuneration ticked up 4% to £356,930. The directors do not recommend a dividend.Source: HYCM Capital Markets (UK) Limited annual report, year ended 31 December 2025.Small CFD Operators Squeezed by FCA ReviewHYCM Capital Markets (UK) Limited belongs to a shrinking pool of small FCA-regulated CFD specialists. A Freedom of Information response to FinanceMagnates.com showed 74 firms held permission to offer CFDs to UK retail clients as of December 1, 2025, out of 105 firms in the regulator's wider CFD portfolio.Pressure at the smaller end has intensified. Two UK brokers collapsed in a single month at the end of 2025, Blackwell Global UK booked a £17,000 loss and exited the retail market in September, and LCG UK followed HYCM into the red on an 18% revenue decline. Larger competitors held up better, with XTB UK reporting a 116% jump in pre-tax profit on cost cuts, and FxPro UK swinging to a £153,103 profit on 23% revenue growth.The HYCM group has been reshaping its footprint around the UK entity. Its Cyprus unit voluntarily renounced its CIF license in 2024 and ceased serving EU-based clients, and the Dubai-based HYCM Limited was sold the same year, leaving the brand to operate primarily through the London company alongside Cayman and DIFC entities.Group Outlook and Regulatory FootingThe directors said they expect profits to return in 2026 and beyond, pointing to what the filing calls increasing interest in CFD trading across the group's core markets.The report explicitly flagged the FCA's November 2025 multi-firm review of CFD providers, which found some firms may not be delivering fair value to retail consumers, alongside the regulator's 2025-2030 strategy. A separate FM Intelligence analysis estimated cumulative compliance costs for mid-tier FCA-regulated CFD brokers now run between £325,000 and over £1 million annually, a burden the report described as potentially existential for firms with UK revenues below £10 million. This article was written by Damian Chmiel at www.financemagnates.com.

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