IG Group seen as a solid bet as clients in UK boost profits

IG GROUP, the owner of spreadbetting firm IG Index, yesterday revealed pre-tax profit over the first half of the year grew by over a quarter, boosted by continued rapid growth in UK customer numbers.

IG said first half statutory pre-tax profit rose by 26 per cent to £69m over the six months to November 2009, on revenues that rose 14 per cent to £143.8m.

The firm has seen the number of its London financial clients soar almost 30 per cent compared to the first half in 2008, averaging over 3,000 new spread betting and CFD accounts per month.

“The UK market is far from reaching client maturity,” said IG finance director Steve Clutton.

But analysts yesterday were sceptical of the group’s ability to win significant numbers of new clients.

UBS analyst Isabel Green said: “[We] expect the greatest near to mid term growth driver will be the maturity profiles of the existing client base.”

IG said its UK revenues had remained flat over the first half due to a strong comparative period in 2008, when volatile share prices during the economic crisis lured many customers to up their trading activity.

However, the group reported strong growth in its newer markets of Australia and Europe, which were both up almost two thirds on the previous year.

IG raised its half-year dividend by a quarter to 5p per share, and said it had paid £2m to buy a small South African contracts for difference firm, Ideal.