Press releases 2005

3 November 2005

ANNOUNCEMENT OF RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2005 AND INTENTION TO RETURN £250 MILLION TO SHAREHOLDERS

London Stock Exchange plc today reports results for the six months ended 30 September 2005. 

Financial Highlights:

• Turnover up 15 per cent to £136.1 million before exceptional items:
  Operating profit up 24 per cent to £50.8 million
• Adjusted earnings per share increased 40 per cent to 15.7 pence per share
• Interim dividend per share doubled from 2.0 pence to 4.0 pence per share reflecting re-setting of dividend payout and strong performance
• Intention to return £250 million to shareholders following the end of the Offer period, or as soon as circumstances allow, and subsequent share buyback programme, reflecting the Exchange’s on-going strong trading performance and cash generation including exceptional items:
  
•  Operating profit down from £45.4 million to £25.1 million, principally reflecting a £23.1m exceptional charge for the impairment of EDX goodwill
• Basic earnings per share reduced from 12.8 pence to 9.6 pence per share

Operational Highlights:

• New issues up 43 per cent to 306, including a 57% increase in Main Market new issues from 30 to 47
• AIM continued strong growth as the number of international companies nearly doubled to 185, reflecting success of overseas marketing
• Broker Services benefited from 30 per cent growth in SETS bargains, helped by success of SETSmm which doubled trading over past year
• Number of terminals receiving real time market data up 8,000 to 98,000, including 5,000 increase in number of professional users to 85,000
• Infolect, the Exchange’s new delivery system for real time market data, was successfully implemented in September.  The new system is 15 times faster, with the capacity to support future market growth at a tenth of the development cost of the previous system.

Commenting on the six months, Clara Furse, Chief Executive, said:

“The Exchange has made an excellent start to the year, with particularly strong growth in Issuer and Broker Services contributing to a 15 per cent increase in turnover.  This has generated a 24 per cent rise in operating profit before exceptional costs and a 40 per cent increase in adjusted earnings per share. 

“Technology enhancements underpin our expectations of a continuation of this strong performance.  This is supported by improving operational efficiencies and cost control which should keep costs flat next year.”

Chris Gibson-Smith, Chairman of the Exchange, said:

“The Exchange has clearly demonstrated its robust strength as an independent business, delivering strong results, despite the backdrop of an Offer period and the significant resources this has entailed.  The Exchange’s excellent trading performance, and the increasing value this creates for shareholders, reflects the quality of the business and the actions taken to ensure we are able to capitalise on improvements in market conditions.
 

“Our confidence in the prospects for the Exchange is reflected in the doubling of the interim dividend, to four pence per share, our intention to return £250 million to shareholders following the end of the Offer period and a subsequent ongoing share buyback programme.”

Further information is available from:

London Stock Exchange 

John Wallace – Media 020 7797 1222
Paul Froud – Investor Relations 020 7797 3322
Lyndal Kennedy – Investor Relations 020 7797 3322

Finsbury  
James Murgatroyd  - 020 7251 3801
Simon Moyse 020 7251 3801

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