IG half-year profit up 32% on overseas growth
Financial spreadbetting specialist IG Group expects to report pre-tax profit up by almost a third at the half-year period after strong growth in Australia, continental Europe and Singapore.
FINANCIAL SPREADBETTING specialist IG Group expects to report pre-tax profit up by almost a third at the half-year period.
The business anticipates a 32% year-on-year (YoY) increase in pre-tax profit to £77m for the six months to 30 November 2009, from £58.2m for the same period last year, it revealed in a trading update.
IG also achieved top-line growth of 13% YoY, posting revenues of £143m, from £126.5m for the comparative period last year.
A company statement said: “The group has achieved growth in the first half against a challenging economic backdrop and strong comparatives from the first half of the prior year. The group’s market positions, technology, product and geographic diversity leave it well positioned for further growth.”
Revenue from IG’s core UK business for the period remained flat £80m, but was offset by strong growth from its mainland Europe, Singapore and Australian operations.
Revenue from mainland Europe grew 65% YoY to £22m, from £13.3m; while revenue from Singapore grew 22% to £5m, from £4.1m. Australian revenues grew 64% to £22m, from £13.4m.
Revenue from FX Online Japan KK (FXO), which the group acquired in October 2008, was £11m for the six months to 30 November 2009. This business was, however, only owned for two months of the comparative period last year, during which it generated £10m of revenue, benefiting from the high volatility of the yen during October 2008.
In October 2009, FXO moved to a lower risk, low fixed spread model, and offering a more balanced portfolio between Forex and the newer contracts for difference (CFD) and binary option products.
The group said early signs were “encouraging”, with an upward trend in the number of clients dealing and the average number of transactions per client.
Excluding the newer FXO business, account openings across the group for the half year remained broadly flat at 32,000, which the company said resulted from a “significant short-term boost” during September and October of the comparative period due to the extreme volatility in the financial markets at this time.
Brokerage Daniel Stewart repeated its ‘buy’ assessment of the group, concluding that “IG appears to go from strength to strength. It’s broad product offering, diversified client base and superior risk management model leave it well placed to deliver continued growth in the medium-term.”
In other financial betting news recently, BetOnMarkers took Financial Betting Operator of the Year at the EGR Awards 2009.