London Capital Group profits down
Declines in adjusted profit reflect a "lack of market volatility" " spread betting division suffers net loss of £0.4m.
London Capital Group (LCG) has reported a decline in profits for the six months ended 30 June 2012, with its spread betting division experiencing falls in both revenue and market volatility, the company has announced in its first interim results statement since the resignation of former chairman Richard Davey.
Total revenue for the Group amounted to £18.4m in the six-month period compared to £18.3m in 2011, but adjusted profit before tax was down by almost a third year-on-year to £2.05m from £3.01m.
ProSpreads, LCG’s Gibraltar-based financial spread betting business suffered from a fall in volumes and market volatility, returning a net loss of £0.4m compared to a profit of £0.04m in H1 last year.
However, the division established a number of new white label partnerships in Q1 including Selftrade and Goodbody Stockbrokers, while a number of white label partners were gained from the Group’s former competitor Worldspreads, which entered administration in March.
Commenting on the results, chief executive Simon Denham, said: “The business operated against a backdrop of difficult market conditions in the first half of the year. Notwithstanding a lack of market volatility, our core spread betting and CFD business has performed well and, in line with our growth strategy, we have signed a number of significant new white label partnerships and continue to see growth opportunities in this market.”
Earlier this month the chairman of the spread betting company resigned with immediate effect and has already been replaced “as planned”. LCG said Davey was to leave the company after five years at the helm but failed to give any reasons for his sudden departure.