AI-driven trading firm Quadrature Capital Limited has reported a steep 76% drop in pre-tax profits from £231m in 2023 to £56m in the year ending January 2024, due to a recent corporate restructuring, according to a report by the Financial Times.
The decline at the UK-based investment firm, which operates a fund in the Cayman Islands and made a £4m donation to the Labour Party in the run-up to this year’s general election in support of the party’s climate-focused agenda, is attributed to a restructuring process that moved its investment holding in its offshore fund to an offshore entity, according to an unnamed source familiar with the matter.
This shift means that Quadrature’s published results now represent a smaller portion of its overall group profits than in previous years.
According to the FT’s source, the restructuring was aimed at facilitating the opening of offices in Singapore and New York, although all trading profits remain subject to UK corporate tax.
Founded in 2010 by billionaires Greg Skinner and Suneil Setiya, who previously worked at De Putron Fund Management, Quadrature employs a “market-neutral trading strategy” that uses algorithms to make stock-buying decisions without holding positions long-term. Quadrature has also historically taken short positions on certain stocks.
The firm reported a rise in salaries, paying £351m to its 143 employees, up from £343m in 2023 when it had 113 employees. However, the average salary decreased from £3m to £2.45m.
Quadrature stated it has paid over £2bn in UK taxes since its inception. “Since the funds have historically been managed exclusively from the UK by Quadrature Capital Limited, all trading profits of the funds have been subject to UK corporate tax,” the firm said.
In addition to its business activities, Quadrature’s founders launched the Quadrature Climate Foundation, which has donated more than $1 billion in philanthropic grants since 2019. According to Charity Commission filings, these grants increased significantly, from £120 million in 2022 to £247 million in 2023.
