THE WORLD’S biggest spread betting firm IG Group yesterday shook off the market gloom dragging down rivals to post a tick up in revenues and boost its dividend policy.
The FTSE 250 company, which controls just over 40 per cent of the UK market, said a 2.4 per cent rise in net trading revenue helped to boost profits by 1.2 per cent to £194.7m for the 12 months ending in May.
The group is launching a stockbroking service in September and is currently trialling an early version of the service with a small group of customers.
“It will take time to get the message out,”chief executive Tim Howkins told City A.M. “The audience for our current products can be slightly niche, so adding a more mainstream product will hopefully change that mindset,”
Market volatility – which normally drives IG’s customers to trade more – have over the past few months been at their lowest levels for 25 years, depressing trading volumes, he added.
Investors cheered the results yesterday, sending shares up over eight per cent in early trading, after the company said it would beef up its ordinary dividend payout. The company will increase the windfall from 60 per cent of earnings to 70 per cent, due to its stronger cash flows.
“The full year dividend is up with a bump and that’s a reflection of the confidence in the business and our strong underlying balance sheet,” Howkins added. Shares closed 7.74 per cent up at 619.5p.