LSEG pre-close period update for the eleven months ended 28 February 2013

Unless otherwise stated, the following commentary refers to the eleven months ended 28 February 2013 and, where appropriate, to the corresponding period last year.

  • Group is continuing to make good progress
  • Against a backdrop of subdued global market activity, there is an encouraging resurgence in the London IPO market
  • LSEG and LCH.Clearnet shareholder meetings on 27 March gave required shareholder approvals for LSEG to acquire up to 55.5 per cent of LCH.Clearnet shares; letter of non-objection received from FSA, completion expected in coming quarter subject to satisfaction of the remaining conditions
  • FTSE announced a new fixed income index joint venture, continuing the Group’s expansion in North America; FTSE TMX Debt Capital Markets will be the third largest fixed income ETF index provider globally
  • In fixed income trading, MTS money markets (repo) value traded increased 17 per cent, while cash markets value traded was unchanged; MOT retail bond trading volumes were strong, showing a 19 per cent increase
  • London Stock Exchange confirmed introduction of its High Growth Segment, a new Main Market segment designed to meet the needs of fast-growing companies and investors seeking growth opportunities
  • Total equity capital raised on the Group’s markets for the period was £14.8 billion (2012: £32.4 billion), with 107 new issues (2012: 144); issuance was strong in Q3 and we are finishing the year well with 12 new issues on the UK Main Market and AIM in March and an encouraging pipeline for the new financial year
  • Average daily UK equity value traded down 15 per cent and Italian average daily volumes down 14 per cent; derivatives trading volumes decreased 30 per cent over the same period last year
  • Clearing volumes reduced in line with trading levels; initial margin held increased 6 per cent to an average €10.1 billion; net treasury income in the current quarter reduced as expected, with €4.9 billion invested on a fully collateralised basis
  • FTSE continues to make good progress, with ETF AUM increasing 33 per cent year on year, on a like-for-like basis, as at the end of February 2013; up 140 per cent reflecting the new Vanguard AUM effective from January 2013; subscription renewal rates remain high at 94 per cent
  • FTSE benefitting from positive trends for international investment in China: FTSE China A50 index has a leading position for ETFs on QFII and RQFII schemes, with quotas on both increasing
  • Professional users of both UK and Italian market real time information decreased as expected; demand for other information products, including UnaVista and SEDOL remained good
  • The Group has completed the acquisition of a 67 per cent stake in GATElab, an Italian and UK-based trading and connectivity technology company; will complement existing capabilities working, with MillenniumIT on further developing the Group’s capital markets IT capabilities
  • The Group launched the ‘International Board’, an agreement with Singapore Stock Exchange to allow the largest stocks on each exchange to be traded by their respective member firms

Commenting on performance for the period, Xavier Rolet, Chief Executive, said:

“We are making good progress. The Group has continued to develop, diversifying in scope and extending its international reach. Notable recent developments include FTSE’s fixed income joint venture, the continued strengthening of our IT capabilities and the launch of our International Board. The new High Growth Segment of our London market provides further funding opportunities for fast growing companies and is an important additional development to help stimulate growth and job creation.

“We are also pleased to have secured shareholder approvals for the acquisition of a majority stake in LCH.Clearnet and we continue to work towards completion in the coming period. We remain well placed across a wide range of business lines to develop further in the year ahead.”

The Group expects to announce its Preliminary results for the year ending 31 March 2013 on 15 May 2013.

Further information is available from:

London Stock Exchange Group plc

Victoria Brough
Media +44 (0) 20 7797 1222

Paul Froud
Investor Relations +44 (0) 20 7797 3322

Citigate Dewe Rogerson
Patrick Donovan/Grant Ringshaw +44 (0) 20 7638 9571

Key Performance Indicators

Capital   Markets - Primary Markets

     
         
 

Eleven months ended

 

28 Feb

 

29 Feb

Variance

 

2013

 

2012

%

New   Issues

       

UK   Main Market, PSM & SFM

34

 

54

(37%)

UK   AIM

68

 

82

(17%)

Borsa   Italiana

5

 

8

(38%)

Total

107

 

144

(26%)

         

Company Numbers (as at period end)

       

UK   Main Market, PSM & SFM

1,372

 

1,444

(5%)

UK   AIM

1,094

 

1,122

(2%)

Borsa   Italiana

287

 

291

(1%)

Total

2,753

 

2,857

(4%)

         

Market   Capitalisation (as at period end)

       

UK   Main Market (£bn)

2,135

 

1,947

10%

UK   AIM (£bn)

65

 

71

(8%)

Borsa   Italiana (€bn)

359

 

378

(5%)

Borsa   Italiana (£bn)

310

 

319

(3%)

Total   (£bn)

2,510

 

2,337

7%

         

Money   Raised (£bn)

       

UK   New

8.1

 

11.7

(31%)

UK   Further

5.2

 

5.2

0%

Borsa   Italiana new and further

1.5

 

15.5

(90%)

Total   (£bn)

14.8

 

32.4

(54%)

 

Capital   Markets - Secondary Markets

     
         
 

Eleven months ended

 

28 Feb

 

29 Feb

Variance

Equity

2013

 

2012

%

Totals   for period

       

UK   value traded (£bn)

901

 

1,060

(15%)

Borsa   Italiana (no of trades m)

51.2

 

60.7

(16%)

Turquoise   value traded (€bn)

376.0

 

472.0

(20%)

         

SETS   Yield (basis points)

0.68

 

0.69

(1%)

         

Average   daily

       

UK   value traded (£bn)

3.9

 

4.6

(15%)

Borsa   Italiana (no of trades '000)

222

 

258

(14%)

Turquoise   value traded (€bn)

1.61

 

2.00

(20%)

         

Derivatives   (contracts m)

       

Turquoise

22.8

 

36.5

(38%)

IDEM

33.5

 

43.4

(23%)

Total

56.3

 

80.3

(30%)

         

Fixed   Income

       

MTS   cash and Bondvision (€bn)

2,189

 

2,196

(0%)

MTS   money markets (€bn term adjusted)

63,085

 

54,065

17%

MOT   number of trades (m)

5.74

 

4.82

19%

 

Post   Trade Services

       
         
 

Eleven months ended

 

28 Feb

 

29 Feb

Variance

 

2013

 

2012

%

CC&G   Clearing (m)

       

Equity   clearing (no of trades)

53.9

 

64.0

(16%)

Derivative   clearing (no of contracts)

33.5

 

43.3

(23%)

Total  

87.4

 

107.3

(19%)

Open   interest (contracts as at period end)

4.8

 

5.7

(16%)

Initial   margin held (average €bn)

10.1

 

9.5

6%

         

Monte   Titoli

       

Pre   Settlement instructions (trades m)

26.3

 

30.7

(14%)

Settlement   instructions (trades m)

24.6

 

31.6

(22%)

Total   Settlement

50.9

 

62.3

(18%)

Custody   assets under management (average €tn)

3.22

 

3.04

6%

 

Information   Services

       
         
 

As at

 
 

28 Feb

 

29 Feb

Variance

 

2013

 

2012

%

UK   Terminals

       

Professional   - UK

33,000

 

38,000

(13%)

Professional   - International

50,000

 

53,000

(6%)

Total  

83,000

 

91,000

(9%)

         

Borsa   Italiana Professional Terminals

133,000

 

135,000

(1%)