Growth attributed in part to

Broker/aggregator BGL Group made a profit of £52.8m in the year to 30 June 2011, up 17.7% on the £44.9m it made in the previous financial year. The growth has come amid tough conditions for both the broking and price comparison markets.

Profit before tax came in at £72m in 2010/2011, up 15.5% on the previous year’s £62.3m profit.

The company, whose subsidiaries include UK price comparison site, personal lines broker Budget Insurance and affinity broker Junction, brought in revenues of £361.2m, up 19.5% on the £302.2m it made in the 2009/2010 year.

“The directors are satisfied with the performance for the year and are confident of future prospects,” BGL said in results filed with Companies House.

However, the directors did not recommend the payment of a dividend for the year.

BGL attributed the revenue growth to a static performance in its broking and claims management businesses and “substantial” growth at

It added that the profitability of the group had improved because of the ability of all its businesses to compete in difficult market conditions. Such conditions included rising premiums and increasing consumer price sensitivity in the general insurance market, and continuing competition in the price comparison market, the company said.

Policies under management in BGL’s intermediary division remained constant compared with 2009/2010 at 2.4 million. The company said the intermediary business’s focus was to further develop the sales of core products and affinity services through internet and telesales channels.

The group’s working capital position remains strong”

BGL statement

Underwriters’ net rates at BGL increased by 27% during the 2010/2011 year, compared with a 25% increase in 2009/2010. The company expects the rates to rise further in the 2011/2012 year of account. It added that aggregator volumes and market share “continue to be strong and have performed above expectations in the current year”.

In addition, BGL said affinity provider Junction has continued to win new contracts and renegotiate existing deals. The broker has formed new partnerships with Lloyds, Halifax and Pearl and extended a contract with RAC during the year.

As a result of the improved profitability, BGL’s shareholders’ funds increased 27% to £235.6m in 2010/2011 from £185.8m the previous financial year.

The company also has very little debt. Total borrowings as of 30 June 2011 were just £444,000 - none of which was long-term. This compares with total borrowings of £3.7m the previous financial year, of which the bulk - £3.2m - was short-term.

“The group’s working capital position remains strong and the monthly cashflow cycle enables the group to operate without any significant levels of long-term debt,” BGL said in the filing.

BGL’s revenue growth was partly offset by a 22% increase in operating expenses to £288.2m in 2010/2011 from £236.3m the previous year. This was mainly driven by a £36m increase in other operating costs.