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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
London Stock Exchange Group Plc | LSE:LSE | London | Ordinary Share | GB00B0SWJX34 | ORD SHS 6 79/86P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 8,620.00 | 8,602.00 | 8,606.00 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMLSE
RNS Number : 6531X
London Stock Exchange Group PLC
01 May 2019
1 May 2019
LONDON STOCK EXCHANGE GROUP plc
TRADING STATEMENT
INCLUDING REVENUES AND KPIs FOR THE THREE MONTHSED 31 MARCH 2019 (Q1)
-- Good overall Q1 income performance against challenging market backdrop -- Q1 total income up 5% year-on-year to GBP546 million
-- Group continues to develop and invest for growth, with the acquisition of minority stake in Euroclear and launch of new services in Post Trade and Information Services
Q1 summary:
-- Information Services: revenues up 6% to GBP214 million - with 7% growth at FTSE Russell. Growth in index subscriptions remained strong while FTSE Russell asset-based revenues reduced due to reduction in AuM at the end of 2018 (which impacted on revenue in the first part of Q1 2019); asset-based revenue in Q2 is expected to be stronger
-- Post Trade - LCH: income up 17% to GBP182 million, with 16% revenue growth in OTC following record volumes at SwapClear and no discernible change to customers' use of the service as equivalence secured in event of hard Brexit; LCH benefited from an updated SwapClear agreement with partner banks, with effect from the start of the year, estimated to deliver c.GBP30 million savings to cost of sales in 2019
-- Post Trade - Italy: income down 4% to GBP36 million as equity markets experienced a slow first quarter; after adjusting for the treatment of T2S costs, gross profit increased 3%
-- Capital Markets: revenues down 9% to GBP97 million, mostly reflecting lower equity trading volumes
-- Technology Services: revenues up 9% to GBP14 million
David Schwimmer, CEO said:
"We continue to execute our strategy across our core businesses of Information Services, Post Trade and Capital Markets. In Post Trade, we acquired a stake in Euroclear, which shares our open access approach, and we updated our SwapClear agreement, which will deliver significant savings as we further develop the service.
"We are investing in and growing our Information Services business, including developing our multi-asset and data and analytics offering. While equity markets were slower due to macroeconomic uncertainty, we have seen an improved listing environment in Q2.
"The Group is strategically well positioned to develop its growth opportunities further in the evolving macroeconomic landscape."
New product development and investment in opportunities continued across the business:
- Group acquired a 4.9% stake in Euroclear with a seat on the Board, which will help strengthen the existing commercial relationships between the businesses
- LCH RepoClear members successfully consolidated European debt clearing activity in LCH SA, benefitting from T2S efficiencies
- SwapClear Non-Deliverable IRS Clearing expanded to include 5 new LatAm and Asia-Pacific currencies
- Dutch pension fund Pensioenfonds Detailhandel selected a custom FTSE Russell ESG benchmark as the basis of a new EUR6bn developed market passive equity mandate managed by BlackRock
- FTSE Russell launched a new Multi-Asset Composite Index Series - a wide range of indexes across major asset classes covering global, regional and emerging markets
- In early April, Network International, a Middle Eastern payments company, raised GBP1.1 billlion on London Stock Exchange plc; and Nexi, a major Italian payments company listed on Borsa Italiana, raising $2.6 billion, the largest IPO year to date globally
- Acquisition of minority stake in Nivaura, partnering with them to support capital markets innovation through use of emerging technologies
Financial Position
The Group's financial position remains strong and is broadly unchanged from that reported for 31 December 2018. As at 31 March 2019, having funded the purchase of a 4.9% stake in Euroclear, the Group had committed facility headroom of over GBP750 million available for general corporate purposes.
S&P maintains a positive outlook over its A- long term rating of LSEG, while Moody's rates LSEG A3 with a stable outlook.
The euro weakened by 2% and the US dollar strengthened by 6% against sterling compared with the same period last year. To illustrate our exposure to movements in exchange rates, a EUR0.05 change up or down in the average euro:sterling rate would have resulted in a corresponding change to continuing operations total income of c.GBP7 million for Q1, while a US$0.05 move would have resulted in a c.GBP6 million change.
Further information is available from:
Gavin Sullivan/Lucie Holloway London Stock Exchange - Media +44 (0) 20 7797 1222 Group plc Paul Froud - Investor Relations +44 (0) 20 7797 3322
A conference call for analysts and investors will be held at 8:00 (UK time) on Wednesday 1 May. On the call will be David Warren (Group CFO) and Paul Froud (Group Head of Investor Relations).
To access the telephone conference call dial 0800 376 7922 or +44 (0) 20 7192 8000
Conference ID: 506 6297
Q1 Revenue Summary
Revenues for three months ended 31 March 2019 refer to continuing operations, with comparatives against performance for the same period last year, are provided below. Growth rates for Q1 performance are also expressed on an organic and constant currency basis. All figures are unaudited.
Three months ended Constant 31 March currency --------------------- 2019 2018 Variance variance Continuing operations: GBPm GBPm % % Revenue Information Services 214 201 6% 3% Post Trade Services - LCH 134 118 14% 14% Post Trade Services - CC&G and Monte Titoli 25 28 (10%) (9%) Capital Markets 97 107 (9%) (9%) Technology 14 13 9% 9% Other 2 3 (31%) (31%) ----------------------------- ---------- --------- --------- --------- Total revenue 486 470 3% 2% Net treasury income through CCP businesses 59 48 23% 22% Other income 1 2 (53%) (53%) ---------- Total income 546 520 5% 4% ----------------------------- ---------- --------- --------- --------- Cost of sales (56) (56) - (1%) ---------- --------- Gross profit 490 464 6% 4% ----------------------------- ---------- --------- --------- ---------
The Group's principal foreign exchange exposure arises from translating and revaluing its foreign currency earnings, assets and liabilities into LSEG's reporting currency of Sterling.
More detailed revenues by segment are provided in tables below:
Information Services
Revised reporting format:
Three months ended Constant 31 March currency --------------------- 2019 2018 Variance variance GBPm GBPm % % Revenue Index - Subscription 99 89 11% 7% Index - Asset based 52 52 - (6%) FTSE Russell 151 141 7% 2% ---------------------------- ---------- --------- --------- --------- Real time data 24 24 (1%) (1%) Other information services 39 36 8% 7% Total revenue 214 201 6% 3% ---------------------------- ---------- --------- --------- --------- Cost of sales (17) (18) (2%) (7%) ---------- --------- Gross profit 197 183 7% 3% ---------------------------- ---------- --------- --------- ---------
Note:
Mergent and some other minor items (previously reported in FTSE Russell subscriptions), are now included in Other information services
Previous reporting format:
Three months ended Constant 31 March currency --------------------- 2019 2018 Variance variance GBPm GBPm % % Revenue FTSE Russell 161 150 7% 2% Real time data 24 24 (1%) (1%) Other information services 29 27 7% 7% Total revenue 214 201 6% 3% ---------------------------- ---------- --------- --------- --------- Cost of sales (17) (18) (2%) (7%) ---------- --------- Gross profit 197 183 7% 3% ---------------------------- ---------- --------- --------- ---------
Post Trade Services - LCH
Three months ended Constant 31 March currency --------------------- 2019 2018 Variance variance GBPm GBPm % % Revenue OTC - SwapClear, ForexClear & CDSClear 76 66 16% 14% Non OTC - Fixed income, Cash equities & Listed derivatives 34 33 2% 3% Other 24 19 26% 27% ---------- --------- Total revenue 134 118 14% 14% ------------------------------------- ---------- --------- --------- --------- Net treasury income 48 38 26% 24% Other income - - - - Total income 182 156 17% 16% ------------------------------------- ---------- --------- --------- --------- Cost of sales (32) (25) 26% 28% ---------- --------- Gross profit 150 131 15% 14% ------------------------------------- ---------- --------- --------- ---------
Post Trade Services - CC&G and Monte Titoli
Three months ended Constant 31 March currency --------------------- 2019 2018 Variance variance GBPm GBPm % % Revenue Clearing 11 10 3% 4% Settlement, Custody & other 14 18 (18%) (16%) Total revenue 25 28 (10%) (9%) ----------------------------- ---------- --------- --------- --------- Net treasury income 11 10 13% 15% Total income 36 38 (4%) (3%) ----------------------------- ---------- --------- --------- --------- Cost of sales (1) (2) (4) (61%) (61%) ---------- --------- Gross profit 34 34 3% 5% ----------------------------- ---------- --------- --------- ---------
1 Pass through of T2S costs, Cost of sales have now been netted off against Settlement, Custody & other, 2019 Q1 impact GBP3m
Capital Markets
Three months ended Constant 31 March currency --------------------- 2019 2018 Variance variance GBPm GBPm % % Revenue Primary Markets 28 29 (2%) (1%) Secondary Markets - Equities 37 45 (18%) (18%) Secondary Markets - Fixed income, derivatives and other 32 33 (4%) (3%) Total revenue 97 107 (9%) (9%) ------------------------------ ---------- --------- --------- --------- Cost of sales (1) (5) (67%) (67%) ---------- --------- Gross profit 96 102 (6%) (6%) ------------------------------ ---------- --------- --------- ---------
Technology Services
Three months ended Constant 31 March currency --------------------- 2019 2018 Variance variance Revenue GBPm GBPm % % MillenniumIT & other technology 14 13 9% 9% --------------------------------- ---------- --------- --------- --------- Cost of sales (2) (3) (16%) (16%) ---------- --------- --------- --------- Gross profit 12 10 16% 16% --------------------------------- ---------- --------- --------- ---------
Basis of Preparation
Results for the period ended 31 March 2019 have been translated into sterling using the average exchange rates for the period. Constant currency growth rates have been calculated by translating prior period results at the average exchange rate for the current period.
Average rate Average rate Closing rate Closing rate 3 months ended at 3 months ended at 31 March 2019 31 March 2019 31 March 2018 31 March 2018 GBP : EUR 1.15 1.16 1.13 1.14 GBP : USD 1.30 1.30 1.39 1.40 --------------- -------------- --------------- --------------
Appendix - Key performance indicators
Information Services As at 31 March Variance ------------------ 2019 2018 % ETF assets under management benchmarked ($bn) FTSE 413 399 4% Russell Indexes 256 240 7% ----------------------------- --------- Total 669 639 5% ----------------------------- -------- -------- --------- Terminals UK 67,000 68,000 (1%) Borsa Italiana Professional Terminals 105,000 109,000 (4%) Post Trade Services - LCH Three months ended 31 March Variance --------------------- 2019 2018 % OTC derivatives SwapClear IRS notional cleared ($tn) 318 291 9% SwapClear members 119 105 13% Client trades ('000) 411 407 1% CDSClear Notional cleared (EURbn) 176 162 9% CDSClear members 26 13 100% ForexClear Notional value cleared ($bn) 4,311 4,286 1% ForexClear members 34 30 13% ------------------------------- ---------- --------- --------- Non-OTC Fixed income - Nominal value (EURtn) 26.2 23.9 10% Listed derivatives (contracts m) 36.4 38.5 (5%) Cash equities trades (m) 180.8 221 (18%) ------------------------------- ---------- --------- --------- Average cash collateral (EURbn) 91.1 83.0 10% Post Trade Services - CC&G and Monte Titoli Three months ended 31 March Variance --------------------- 2019 2018 % CC&G Clearing Contracts (m) 25.0 29.7 (16%) Initial margin held (average EURbn) 13.7 9.0 52% Monte Titoli Settlement instructions (trades m) 10.7 11.7 (9%) Custody assets under management (average EURtn) 3.31 3.30 - Capital Markets - Primary Markets Three months ended 31 March Variance --------------------- 2019 2018 % New Issues UK Main Market, PSM & SFM 11 19 (42%) UK AIM 5 12 (58%) Borsa Italiana 7 6 17% ---------- Total 23 37 (38%) --------------------------- ---------- --------- --------- Money Raised (GBPbn) UK New 0.5 1.0 (50%) UK Further 3.0 5.5 (45%) Borsa Italiana new and further 0.0 1.5 (100%) Total (GBPbn) 3.5 8.0 (56%) --------------------------- ---------- --------- --------- Capital Markets - Secondary Markets Three months ended 31 March Variance --------------------- Equity 2019 2018 % Totals for period UK value traded (GBPbn) 294 388 (24%) Borsa Italiana (no of trades m) 15.6 19.2 (19%)
Turquoise value traded (EURbn) 163 254 (36%) SETS Yield (basis points) 0.68 0.61 11% Average daily UK value traded (GBPbn) 4.7 6.2 (24%) Borsa Italiana (no of trades '000) 248 305 (19%) Turquoise value traded (EURbn) 2.6 4.0 (35%) Derivatives (contracts m) LSE Derivatives 0.8 1.8 (56%) IDEM 8.3 9.2 (10%) Total 9.1 11.0 (17%) ------------------------------ ---------- --------- --------- Fixed Income MTS cash and BondVision (EURbn) 836 1,030 (19%) MTS money markets (EURbn term adjusted) 28,809 19,588 47%
Total Income - Quarterly
2018 2019 GBP millions Q1 Q2 Q3 Q4 2018 Q1 ---------------- ---------------- ---------------- ---------------- ---------------- Index - Subscription 89 96 94 94 373 99 Index - Asset based 52 53 59 55 219 52 FTSE Russell 141 149 153 149 592 151 Real time data 24 23 23 24 94 24 Other information 36 39 36 44 155 39 ------------- Information Services 201 211 212 217 841 214 OTC - SwapClear, ForexClear & CDSClear 66 64 65 73 268 76 Non OTC - Fixed income, Cash equities & Listed derivatives 33 34 34 35 136 34 Other 19 21 21 22 83 24 ------------- ---------------- ---------------- ---------------- ---------------- --------------- ---------------- Post Trade Services - LCH 118 119 120 130 487 134 Clearing 10 12 10 9 41 11 Settlement, Custody & other 18 12 15 16 61 14 ------------- ---------------- ---------------- ---------------- ---------------- --------------- ---------------- Post Trade Services - CC&G and Monte Titoli 28 24 25 25 102 25 Primary Markets 29 33 20 31 113 28 Secondary Markets - Equities 45 44 39 41 169 37 Secondary Markets - Fixed income, derivatives & other 33 31 30 31 125 32 ------------- ---------------- ---------------- ---------------- ---------------- --------------- ---------------- Capital Markets 107 108 89 103 407 97 Technology 13 19 16 17 65 14 Other 3 2 2 2 9 2 Total Revenue 470 483 464 494 1,911 486 Net treasury income through CCP: CC&G 10 11 11 11 43 11 LCH 38 45 46 46 175 48 Other income 2 1 1 2 6 1 Total income 520 540 522 553 2,135 546 ------------- ---------------- ---------------- ---------------- ---------------- --------------- ---------------- Cost of sales (56) (50) (57) (64) (227) (56) Gross profit 464 490 465 489 1,908 490 ------------- ---------------- ---------------- ---------------- ---------------- --------------- ----------------
Note Information Services:
Mergent and some other minor items (previously reported in FTSE Russell subscriptions), are now included in Other information services
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
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