London Capital bets on profit rise to come

SPREAD better London Capital Group bucked yesterday’s downward stock market trend to close up 0.7 per cent after reporting a £3m first-half profit.

LCG said profits fell 28 per cent compared with a year ago when business was boosted by extreme volatility around events such as the “flash crash” and Greek bailout. Revenues fell 12 per cent to £18.3m.

Keefe Bruyette & Woods analyst Justin Bates said the figures were “a tepid result in a difficult market” but its outlook gave cause for optimism.

LCG said new accounts opened were up almost 20 per cent on a year ago, while funds in accounts were more than a fifth higher at £24.6m.

It also said the spread betting market, where it makes 61 per cent of its revenue, was robust.

Chief executive Simon Denham warned that regulation, costs and very low spreads remained risks but said the outlook for the rest of 2011 was “very good”.