Shares of spread betting firm London Capital Group fell after it reported a drop in half yearly profit as it pursues a settlement strategy for outstanding FOS claims.
Pre-tax profit fell to £0.15m in the six months ended 30 June 2012 from £2.69m a year before following recognition of additional provision for FOS claims of £1.9m.
Adjusted profit before tax fell to £2.05m compared to £3.01m in the same half a year earlier reflecting lack of market volatility. Revenue was little changed at £18.41m compared to £18.34m previously.
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Commenting on the results, Simon Denham, Chief Executive, 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."
He added: "We believe that our settlement strategy in relation to the outstanding FOS claims will reach a satisfactory resolution. We remain very well capitalised, with a strong cash position, and are encouraged by the medium-term prospects for the group."
Net cash and short term receivables rose £3.06m to £25.54m.
The interim dividend payment has been kept at 1.3p per share.
CJ
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