IG is on the money with revenue leap
Wednesday 18 July 2012
The spread-betting giant IG Group saw revenues in the year to May jump 17 per cent to £367m.
Margins in spread betting are so high that IG turned a profit of £186m on those sales, a rise of 14 per cent. Things have slowed down in the past few weeks, but its chief executive Tim Howkins said: "The market is catching its breath after the excitement of two Greeks elections.
"That is not just in our industry, it is at stockbrokers and investment banks. People are sitting on the sidelines, waiting for news flow. I still think we will deliver fairly modest growth this year."
Unlike many City firms, IG's staff numbers are up, by 86 over the year to 1,012. About 30,000 people place trades with the company each month. Mr Howkins notes that 500,000 Britons have online stock-trading accounts so reckons the spread-betting industry has room to grow.
One source of irritation for IG is the bill extracted by the Financial Services Compensation Scheme, which pays out to clients of collapsed brokers.
That cost IG £5m this year, which it thinks is harsh, since it does not give advice. "We have to keep bailing out failed advisory firms. It seems unfair to lump us in together," Mr Howkins said.
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