Adjusting for acquisition amortisation charges and non-recurring items left operating profits at the London Stock Exchange (LSE) down 3 per cent to £430m in the financial year to March 2013. However, these numbers were flattered by the inclusion of a full 12-month contribution from FTSE International, which drove operating profits in its information services division up 23 per cent to £154m. Trading in the other divisions was generally weaker. Still, earnings easily beat consensus estimates and the shares rose 6 per cent to close in on a five-year high post results.
Suppressed markets and weak investor confidence saw fee revenue from primary and secondary markets down 11 per cent at £267m, while money raised through new issues and flotations slid from £33.8bn to £18bn. Moreover, admissions to primary markets fell a third to just 40 new issues, with new listings on the Alternative Investment market (Aim) declining 17 per cent to 74 companies. Inevitably, this hit post-trade services, where revenue from clearing, settlement and custody fell 10 per cent to £91.8m.
On a brighter note, total revenue from technology services grew by 7 per cent to £56.1m, thanks to successful development and delivery of systems for others exchanges, including the London Metal Exchange and Bursa Malaysia. Group finances remain in pretty good shape, too, with improving cash generation reducing net debt by over a third to £350m.
Broker Numis Securities forecasts current year adjusted EPS of 100p (105.3p in 2013).
| LONDON STOCK EXCHANGE (LSE) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,411p | MARKET VALUE: | £3.83bn | |
| TOUCH: | 1,410-1,411p | 12-MONTH HIGH: | 1,431p | LOW: 913p |
| DIVIDEND YIELD: | 2.1% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 565p* | NET DEBT: | 22% | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 645 | -251 | -126 | 24.4 |
| 2010 | 606 | 144 | 34 | 24.4 |
| 2011 | 616 | 238 | 56 | 26.8 |
| 2012 | 680 | 640 | 194 | 28.3 |
| 2013 | 726 | 299 | 80 | 29.5 |
| % change | +7 | -53 | -58 | +4 |
Ex-div: 24 Jul Payment: 19 Aug *Includes intangible assets of £2bn, or 756p a share | ||||
