Just days after London Stock Exchange (LSE) confirmed its bid to buy Thomson Reuters' data service Refinitiv, the bourse used its half-year numbers to announce final deal terms. Should all go to plan, investors can expect the deal to complete during the second-half of 2020, but if regulators fail to approve the deal LSE could be on the hook for a £198m break fee.
Until then, investors will hope for more of the same from the majority-owned post-trade clearing business, LCH, which was the main driver of revenue growth during the first-half of 2019. SwapClear was another bright spot, clearing a record €660trn in over-the-counter derivatives, a 15 per cent rise on the prior year, helped by a 10 per cent uptick in membership.
FTSE Russell Indexes – that has benefited from the explosive popularity of exchange traded funds (ETF) - was boosted by a 9 per cent rise in ETFs benchmarked to them. Information services also sought to capitalise on another investment trend, acquiring ESG-focused fixed income data provider Beyond Ratings.
The value of equity traded on LSE and Tortoise declined by more than a quarter, while fixed income, derivatives and other trading revenue fell by 4 per cent in aggregate. However, new revenue recognition accounting standards boosted capital markets revenue 5 per cent higher.
Bloomberg consensus forecasts adjusted EPS of 191.7p for the year to December 2019, up from 170.8p in 2018.
LONDON STOCK EXCHANGE GROUP (LSE) | ||||
ORD PRICE: | 7,062p | MARKET VALUE: | £ 24.7bn | |
TOUCH: | 7,060-7,064p | 12-MONTH HIGH: | 7,152p | LOW: 3,842p |
DIVIDEND YIELD: | 0.9% | PE RATIO: | 51 | |
NET ASSET VALUE: | 990p* | NET DEBT: | 24% |
Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
2018 | 0.95 | 360 | 71.1 | 17.2 |
2019 | 1.02 | 363 | 70.7 | 20.1 |
% change | +7 | +1 | -1 | +17 |
Ex-div: | 22 Aug | |||
Payment: | 17 Sep | |||
*Includes intangible assets of £4.67bn, or 1,334p a share |