London Stock Exchange Group Posts Steady 2022 Earnings

London Stock Exchange Group Posts Steady 2022 Earnings

The LSEG group is a leading provider of global financial markets infrastructure and data, as well as post trade services. It owns companies such as FTSE Russell and Refinitiv.

Additionally, it provides green Sukuk listing and is a co-lead marketer of social bonds. Furthermore, in 2020 it launched Spark Live, an online platform designed to assist issuers in telling their story to investors.

Basic earnings per share

London Stock Exchange Group reported steady 2022 earnings, helped by the integration of Refinitiv and favorable foreign exchange movements. It reported total income including recoveries at 7.743 billion pounds ($9.28 billion) in preliminary results for 2022, just above analysts' consensus estimate. Furthermore, its basic earnings per share of 141.8 pence and dividend per share of 107 pence both exceeded analyst estimates.

LSEG operates market infrastructure primarily in the United Kingdom, Europe and Asia. Its business activities include trading, clearing, risk management, capital optimization, regulatory reporting and technology services. Furthermore, LSEG provides data & analytics, news products as well as index products.

Its primary markets include the London Stock Exchange (on which it is listed), Turquoise, CurveGlobal, FXall and Tradeweb. Furthermore, it licenses capital markets; installs software; and provides maintenance services.

LSEG is the parent company of the FTSE 100, a market capitalization-weighted index that follows the performance of the 100 largest companies listed on the London Stock Exchange. With an average daily volume of over 500,000 trades, this makes LSEG both Europe's most active stock exchange and one of the world's busiest by number of transactions.

In addition to the FTSE 100, LSEG owns Refinitiv, a financial information provider; LSEG Technology, an international technology firm; and majority stakes in LCH and Tradeweb. Furthermore, it operates various international equity, fixed income, and exchange-traded funds/exchange-traded securities markets.

The company offers post-trade services, network connectivity and server hosting. Its products include indexes, benchmarks and real time pricing data.

It has a stake in FTSE Russell, an index provider. Furthermore, it owns LSEG Technology which provides cloud-based data and analytics solutions.

The company owns majority stakes in LCH and Tradeweb, which provide market data and trading services. Its other divisions include Data & Analytics, Capital Markets, and Post Trade groups. Major competitors include Deutsche Borse, Euronext, and CME Group.

Adjusted earnings per share

On Thursday, March 2 (Reuters), London Stock Exchange Group reported slightly better-than-expected full year income for 2022 on Thursday and praised its integration of Refinitiv as a success as it announced plans to increase ownership in the data analytics group. It reported total income, including recoveries, of 7.743 billion pounds in preliminary results for 2022 - just above analysts' consensus estimate of 7.733 billion pounds. Furthermore, LSE Group increased its dividend per share from 107 pence per share - an increase of 12.6% over last year's payout - thus far.

Adjusted earnings per share, which exclude non-recurring items, reached PS258 million in 2022 - up 17.8% from the prior year. This growth was fueled by strong profitability and favorable foreign exchange movements.

Furthermore, adjusted EBITDA increased 6.0% to PS3,550 million in 2022 from PS3,399 million in 2021 due to an improvement in the group's core post trade business (which includes CCP and clearing services).

The company operates through three segments: Information Services, Capital Markets and Technology Services. The Information Services segment offers subscription fees for data and index services as well as network connectivity/server hosting; market trading services; clearing, risk management, capital optimization and regulatory reporting solutions. Lastly, the Capital Markets division operates internationally across equity, fixed income and exchange-traded funds/currency markets.

Capital Markets revenue consists of admission fees for initial listings and further capital raises; annual fees charged on securities traded on the group's markets; and fees from secondary market services. The Technology Services segment offers capital markets software licenses as well as related information technology infrastructure, network connection, and server hosting services.

LSEG has worked to enhance efficiency throughout its business, with an aim of achieving savings of at least 20% by 2021. To meet this target, they are investing heavily in new technology and services to meet this objective.

Operating expenses before depreciation, amortization and impairment rose 4.1% in 2022, excluding acquisitions and disposals, from 2.4% the prior year. This growth was primarily due to Refinitiv's additional month's contribution (11 months included in 2021) as well as favorable foreign exchange movements.

Revenues

London Stock Exchange Group (LSEG) reported 2022 earnings that were in line with expectations, as the company continues to build momentum after completing its acquisition of data analytics firm Refinitiv in 2021. This integration has given LSEG an edge in financial data and information services - their largest segment by revenue.

LSEG boasts several revenue-producing businesses, such as its global equity, fixed income, exchange-traded funds/derivatives markets, data, index, and analytics solutions. With these secure operations in place, the company is well positioned to continue generating strong profits for years to come.

To remain ahead of the competition, LSEG is continually investing in its infrastructure and products. Furthermore, it has entered into a 10-year partnership with Microsoft to modernize its technology and offer cutting-edge products and services using Azure cloud solutions.

LSEG expects this partnership to generate positive outcomes over the next decade, though it will increase costs initially. Nonetheless, they remain confident that their investments will yield rewards in the long run.

Wallet Investor has developed baseline London Stock Exchange Group share price predictions for the next one to three years using an algorithm. This model is based on technical indicators and indicates a bearish outlook for the stock.

According to the algorithm, LSEG stock is expected to decline 4.4% in the short-term and 14.9% over the mid-term. This forecast assumes that LSEG's share price will remain below its historical average over the next year - an outcome which seems unlikely.

LSEG shares have outperformed the FTSE 100 index this year by more than 4%, surpassing it by nearly four percentage points. Furthermore, over the past 10 years LSEG shares have outpaced the FTSE 100 by 851.1%.

In the first half of 2022, LSEG experienced strong growth across key business segments such as data and analytics, capital markets, and post trade. Its total income and gross profit both saw significant increases. Notably, their data analytics business generated PS2,354 million of revenues during this time.

Net income

The London Stock Exchange Group reported steady 2022 earnings, with total income rising from 7.743 billion pounds to 8.292 billion pounds and basic and diluted earnings per share rising by 14.8% and 107 pence, respectively. Profits have also been enhanced by the company's acquisition of Refinitiv - now its largest division - which helped drive earnings up. LSEG anticipates revenue growth at constant currency rates between 6%-8% in 2023 with adjusted Ebitda margins around 48%.

LSEG is an integrated financial services provider that operates a range of market infrastructure businesses. It provides data and analytics, capital markets, as well as post-trade services. Among its data products are FTSE Russell benchmarks, WM/Refinitiv benchmarks, data feeds, terminals; additionally it offers network connectivity, server hosting services, market trading activities such as clearing and risk management services; all under one roof!

Capital Markets segment offers global equity, fixed income, exchange-traded funds/exchange-traded securities and foreign exchange markets through London Stock Exchange, AIM, Turquoise, CurveGlobal FXall and Tradeweb platforms. Furthermore, these markets provide indexes, benchmarks real time pricing data trade reporting reconciliation services as well as media training & events space hire options.

In addition to data and analytics services, LSEG owns and operates the world's largest clearing house for OTC swaps, Tradeweb. Furthermore, they hold a majority stake in several media brands such as Reuters and Thomson Reuters.

The company provides a selection of capital markets services, such as licensing, installation and maintenance. Furthermore, the firm licenses software and services like trading platforms and clearing services.

LSEG has seen its share price increase by 9.1% this year and it is currently approaching a resistance level at 8,600p. If this level is breached, LSEG could see further price declines in the near future.

On Thursday, LSEG reported its latest full-year results and exceeded the consensus estimate with total income of 7.743 billion pounds. It also declared a dividend of 107 pence per share. Furthermore, the company praised Refinitiv's integration as a success and plans to increase its ownership stake in the data analytics firm.