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London Stock Exchange Group plc
Preliminary results for the year ended 31 December 2023
Continued strong performance: accelerating growth, significant strategic progress, substantial returns to shareholders
David Schwimmer, CEO said:
"2023 was another strong year for LSEG. We continued our track record of broad-based growth, despite an uncertain environment, and delivered on all the targets we set at the time of the Refinitiv acquisition. We also significantly improved our products and services, further strengthened our leadership team and made great progress on creating a high-performance culture throughout the organisation.
"We continue to build the foundations for sustained, profitable growth across all of our businesses. In Data & Analytics, customers will shortly be using the first products from our partnership with Microsoft: together, we will transform how financial markets participants communicate, research, analyse data and trade. In Capital Markets, we are collaborating more extensively with Tradeweb, creating new avenues for growth. We are also seeing an encouraging IPO pipeline for the London Stock Exchange. Our Post Trade business is in the early phase of its next stage of growth, helping financial institutions manage risk and improve capital efficiency across the whole trading book.
"We look forward to further progress in 2024. Our model - global, multi-asset class, and operating across the entire trade lifecycle - is proven to thrive regardless of market conditions, and we will continue to invest to deliver the best possible services for our customers and returns for our shareholders."
|
Reported |
2023 |
2022 |
Variance |
|
Constant Currency variance % |
Organic constant currency variance % |
|
Total Income (excl. recoveries) |
8,009 |
7,428 |
7.8% |
|
8.3% |
7.1% |
|
Recoveries |
370 |
315 |
17.5% |
|
2.8% |
2.8% |
|
Total Income (incl. recoveries) |
8,379 |
7,743 |
8.2% |
|
8.1% |
6.9% |
|
|
|
|
|
|
|
|
|
Reported |
|
|
|
|
|
|
|
Operating Profit |
1,371 |
1,417 |
(3.2%) |
|
|
|
|
Profit Before Tax |
1,195 |
1,241 |
(3.7%) |
|
|
|
|
Basic Earnings per Share (p) |
138.9 |
141.8 |
(2.0%) |
|
|
|
|
Dividends per Share (p) |
115.0 |
107.0 |
7.5% |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted |
|
|
|
|
|
|
|
EBITDA |
3,777 |
3,550 |
6.4% |
|
8.6% |
8.8% |
|
EBITDA Margin |
47.2% |
47.8% |
|
|
|
|
|
Operating Profit |
2,862 |
2,728 |
4.9% |
|
7.9% |
8.4% |
|
Earnings per Share (p) |
323.9 |
317.8 |
1.9% |
|
|
|
|
Financial highlights |
|
|
(all growth rates are expressed on a constant currency basis, unless otherwise stated) |
|
|
● |
Total income (excl. recoveries) up 8.3%; up 7.7% excluding the Acadia acquisition, towards the upper end of 6%-8% guidance range |
|
● |
Broad-based growth: Data & Analytics +7.3%, Capital Markets +6.1%, Post Trade +17.4% |
|
● |
Good profitability: adjusted EBITDA up 8.6%. Excluding impact of FX-related items, EBITDA margin of 47.7%, consistent with guidance |
|
● |
Adjusted operating profit: up 7.9% reflecting strong EBITDA growth slightly offset by faster recognition of depreciation |
|
● |
Continued adjusted earnings growth: adjusted EPS +1.9% to 323.9 pence; basic EPS -2.0% (both at actual FX rates) |
|
● |
Highly cash generative: £1.8 billion equity free cash flow, 100% cash conversion |
|
Strategic progress and outlook |
|
|
● |
Successful integration and accelerated performance of Refinitiv: 2021-2023 organic total income (excl. recoveries) CAGR of 6.5%1 at the upper end of acquisition targets |
|
● |
Medium-term guidance set out at the Capital Markets Day further raises growth aspiration: targeting mid-to-high single digit organic growth annually, accelerating after 2024 |
|
● |
Attractive acquisitions: Acadia reinforces our leading position in Post Trade Solutions; acquired full ownership of LCH SA; increased ownership of LCH Group |
|
● |
Good progress on Microsoft partnership: first products expected in H1 2024, embedding AI technologies and revolutionising industry workflows |
|
● |
Significant shareholder returns: the Board is proposing a final dividend of 79.3 pence per share, which together with the interim dividend of 35.7 pence per share paid to shareholders in September 2023, results in a 7.5% increase in the total dividend to 115 pence per share. The final dividend of 79.3 pence per share will be paid on 22 May 2024 to all shareholders on the share register at the record date of 19 April 2024 |
|
● |
£1.2 billion returned via buybacks in 2023; plan to execute up to £1 billion of buybacks in 2024, with intention to acquire this directly from the Blackstone/Thomson Reuters consortium |
This release contains revenues, costs and earnings on a continuing basis, and key performance indicators (KPIs) for the twelve months ended 31 December 2023. FY 2023 is compared against FY 2022 on a statutory basis. Constant currency variances are calculated on the basis of consistent FX rates applied across the current and prior year period. Organic growth is calculated on a constant currency basis, adjusting the results to remove disposals from the entirety of the current and prior year periods, and by including acquisitions from the date of acquisition with a comparable adjustment to the prior year. Within the financial information and tables presented, certain columns and rows may not add due to the use of rounded numbers for disclosure purposes.
1 Organic, constant currency income (excl. recoveries) growth, excluding deferred revenue accounting adjustment in 2021 and 2022, and the impact of Ukraine/ Russia war in 2022
Contacts: London Stock Exchange Group plc
Investor relations:
Peregrine Riviere / Chris Turner
[email protected]
Media:
Lucie Holloway / Rhiannon Davies
+44 (0)20 7797 1222
Additional information can be found at www.lseg.com
Preliminary results investor and analyst presentation, webcast and conference call:
The Group will host a presentation and conference call on its Preliminary Results for analysts and institutional shareholders today at 10:00am (UK time) at its offices at 10 Paternoster Square, London EC4M 7LS. There will be a Q&A session at the end of the presentation for attendees and those dialling in to the conference call.
To access the conference call or webcast please register in advance using the following link and instructions below:
Conference call: https://registrations.events/direct/LON95410
Presentation slides can be viewed at http://www.lseg.com/investor-relations
The preliminary results for the year ended December 2023 have been submitted in full unedited text to the Financial Conduct Authority's National Storage Mechanism and will be available shortly for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
The results are also available in full on the corporate website at https://www.lseg.com/en/investor-relations/financial-results/2023-preliminary-results.
The information in the preliminary announcement of the results for the year ended 31 December 2023 was approved by the Board of Directors on 28 February 2024 and does not constitute statutory accounts as defined in Section 435 of the UK Companies Act 2006. The financial statements for the year ended 31 December 2022 were filed with the Registrar of Companies, and the audit report was unqualified and contained no statements in respect of Sections 498 (2) and 498 (3) of the UK Companies Act 2006. The financial statements for the year ended 31 December 2023 will be filed with the Registrar of Companies in due course.
In accordance with the Listing Rules of the UK Listing Authority, these preliminary results have been agreed with the Company's auditors, Ernst &Young LLP, who issued an unqualified audit opinion on 28 February 2024 on the Group's Annual Report and Accounts for the year ended 31 December 2023.
The preliminary results have been prepared on a basis consistent with the accounting policies set out in the Group's Annual Report and Accounts for the year ended 31 December 2023.