When Mike Askew and Martyn Hughes stepped up to take the reigns of CBG Group (LON:CB.) in October 2007 the AIM listed insurance broker and financial services group had just wrapped up its 14th acquisition in seven years. But with few signs that a prolonged market cycle of soft insurance rates would pick up any time soon and an economic downturn ready to bite, the team set to work on integrating the group’s network, streamlining the business and opening up new service lines. While market conditions are still fragile and the scope for good quality acquisitions still limited, Askew, the managing director and Hughes, the finance chief, are confident that the business is well positioned to grow.

In its interim figures to June, CBG reported an 11.6% decline in revenues to £4.0m but a 34.1% rise in Ebitda to £0.9m and a strong increase in its broking margins to 23.6% from 16.4% previously. Year-on-year, debt was down to £0.7m from £2.5m, supported by a flexible banking facility signed in May 2009 with Close Premium Finance, which effectively outsourced CBG’s premium financing activity. For investors eyeing the wider sector, CBG’s presence in the non-life insurance segment of the AIM market means that its peers range from the likes of Abbey Protection (LON:ABB) , Ai Claims Solutions (LON:ACS) , Thb Group (LON:THB) , Personal Group Hldgs (LON:PGH) and Brightside Group Plc (LON:BRT) .

Stockopedia spoke to the CBG management team about why prudence will prove to be a virtue as market conditions improve and when acquisitions might be back on the agenda.

What do your interim results say about the shape CBG is in and the state of your markets at the moment?

Mike Askew: The numbers have been seen in the light of what is going on in the bigger world and that we are continuing to manage the business prudently in terms of making sure it is still robust when we are ready to come out the other side of what we’ve currently…

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