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LSE says first-quarter revenues boosted by IPOs

A boom in stock market flotations helped boost revenues for the London Stock Exchange Group by a fifth in the first quarter of its financial year, it said on Wednesday.

LONDON: A boom in stock market flotations helped boost revenues for the London Stock Exchange Group by a fifth in the first quarter of its financial year, it said on Wednesday.

Revenues surged 20 per cent to £299.9 million ($514 million, 280 million euros) in the three months to the end of June, compared with £249.7 million in the same period a year earlier, LSEG said in a results statement.

The company added that, on an organic and constant-currency basis, revenues rose 12 per cent in the reporting period, with growth across nearly all business segments.

Total income grew 16 per cent to £323.9 million, lifted also by clearing house unit LCH.Clearnet, in which LSEG bought a majority holding in 2012.

The group's capital markets division posted a particularly strong performance, the operator of Britain's main exchange and Italy's Borsa Italiana said.

The number of initial public offerings (IPOs) or flotations across its markets more than doubled to 78 from 33 in the same period last year, it added.

"We have made good progress in the first quarter, delivering a strong financial performance," said Chief Executive Xavier Rolet in the earnings release.

"We have been pleased by the continued resurgence in the IPO market with an increase both in the number of companies joining our markets and the amount of money raised."

In a separate announcement at the company's annual general meeting in London on Wednesday, LSEG chairman Chris Gibson-Smith announced that he would step down by the end of 2015.

The company added it was meanwhile preparing a prospectus for a rights issue to help fund its proposed $2.7 billion acquisition of US asset manager Russell.

In late afternoon deals, LSEG's share price gained 1.70 per cent to 1,979 pence.

Earlier this year, in June, the London Stock Exchange Group agreed to purchase Russell in order to diversify and grow its business in the United States.

The deal also involves LSEG buying Russell's index business from parent NorthWestern Mutual.

"The proposed acquisition of Russell Investments will also help to expand the global footprint of the group, particularly in the key US market," added Rolet on Wednesday.

"This is a strong strategic acquisition for the group, which will accelerate development in one of our core strengths, intellectual property, and offers significant growth potential.

"In the coming months, we will focus on obtaining the necessary approvals to complete the acquisition and to deliver the financial benefits of the transaction to the group."

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