* H1 operating profit down 25 percent to 144 mln pounds
* Revenue down 14 pct to 746 mln pounds
* CEO Spencer sees no imminent improvement
* Co says cost-cutting plan on track
* Shares down 5.7 percent, hit lowest in 3-1/2 years (Adds analyst quote, share price)
By Luke Jeffs
LONDON, Nov 14 Brokerage ICAP Plc posted core profit down by a quarter in the first half and its chief Michael Spencer warned he saw no immediate improvement in poor market conditions.
"I do not believe the negative environment will continue indefinitely but equally I do not expect it to improve imminently," Spencer said in an emailed statement, as ICAP warned full-year earnings would be at the low end of the range of analyst forecasts.
S hares in the company, which ranks as the world's largest inter-dealer broker, were down 5.7 percent at 292.3 pence by 0907 GMT, having fallen as low as 284.5p, their lowest since April 2009.
Brokerages such as ICAP and rival Tullett Prebon Plc make money by matching buyers and sellers of bonds, currencies and swaps, but they have been hit by a drop in trading activity as investment banks cut back in the financial crisis.
"This has been one of the toughest periods in my 36 year career in the wholesale financial markets," Spencer said. "Trading volumes this year have fallen significantly across nearly all asset classes."
ICAP posted a 25 percent drop in operating profit to 144 million pounds ($228.8 million) in the six months through September on revenue down 14 percent at 746 million.
The group also said profits for the year to end of March 2013 would be at the lower end of the analyst range of 300 million pounds to 332 million. And some said the group may still struggle to match that expectation.
"It is going to take a strong pick-up at the start of next year for them to meet their profit guidance at the lower end of the analyst range," said Richard Perrott, an analyst at Berenberg Bank.
ICAP pledged drastic cost cuts in June this year and said on Wednesday this plan was progressing well.
"Our cost reduction programme continues apace and we remain on track to deliver in excess of 50 million pounds of savings this year in addition to the 20 million achieved last year," said Spencer.
The CEO added he had seen "a very significant increase in activity" on ICAP's next generation swap trading platform, called i-Swap, and said the company will launch U.S. dollar interest rate swap broking in 2013.
Tullett Prebon said on Friday its revenue for the four months through October fell 12 percent due to "challenging" market conditions, sending its shares down more than 5 percent.
Tullett said in a trading update that revenue of 276 million pounds ($440.8 million) reflected a particularly slow July and August, in which its income was down 19 percent on last year.
Tullett shares, which had slumped to a 3-1/2 year low of 227.3p in the wake of the statement, were up 0.4 percent at 230.8p by 0920 GMT. ($1 = 0.6293 British pounds) (Editing by David Holmes)