IG Group pledges increased investment as revenues rise
Financial betting operator recovers from difficult H1 but still expects to see slight decline in FY earnings
IG Group said it will increase investment in the business after projecting a 1% fall in FY earnings despite recovering from a difficult H1 to post strong revenues for the quarter ending 31 May 2013.
In the fourth quarter of its financial year the financial betting operator said that it expects to post an 8% year-on-year increase in revenues, which rose to £104.3m. The company was able to offset a 2% decline in active clients, with revenue per client rising 10% over the three-month period.
Growth was aided by a number of market events, including a steep fall in the price of gold, strong performance of global equity markets and “the Cyprus bail-in”.
Revenue for H2 2013 grew 13% to £192.9m, up from £171.3m in 2012, but despite this strong growth, the group predicts full-year revenues will decline marginally, after takings from core markets like the UK and Australia fell. Projected earnings for the financial year are around £361.9m, down 1% from 2012’s total of £366.8m.
This is due in part to a difficult first half of its financial year, with IG Group announcing plans to reduce its headcount following a 15% year-on-year fall in H1 revenues.
H2 capital expenditure grew faster than in previous years after the operator invested in a suite of domain names, including IG.com.
The firm also acquired a number of local domains like IG.co.uk and IG.de, designed to feed into the dot.com site, which it described as “another important step in [its] global brand positioning”. It also acquired software to accelerate the growth of its US business Nadex, spending around £5m in total investments.