LSEG Sees Solid Q1 2019, LCH Notes 14% Uptick in Revenues

LSEG has managed to maintain its momentum from 2018 thanks to its information services and LCH revenues.

The London Stock Exchange Group (LSEG) has published a trading statement this Wednesday morning which outlines its revenues and financial indicators for the first quarter of 2019.

Following on from a solid performance in 2018, LSEG has managed to maintain its current momentum, largely thanks to the companies information services and post-trade services through LCH.

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For the group, total revenue increased slightly by three percent year-on-year, climbing from £470 million in the first quarter of 2018, to £486 million in Q1 of 2019.

Total income for the Group also managed to note a yearly uptick, with total income coming in at £546 million, which is higher than the same period of the previous year by five percent.

Altogether, gross profit for LSEG rose by six percent from £464 million in the first quarter of last year to £490 million in the most recent quarter.

LCH Achieves Solid Revenues and Income in Q1

In 2018, LCH achieved a record year in terms of trading volumes. In the first quarter of this year, revenues were £134 million. This represents an uptick of 14 percent from the same quarter in 2018.

Income also managed to climb by 17 percent in the first quarter of 2019 to £182 million and the clearinghouse achieved a 16 percent annual revenue growth in over-the-counter (OTC) following record volumes at SwapClear.

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LCH is a multi-national clearing house controlled by the LSEG. The clearinghouse provides risk management capabilities across a range of asset classes, including foreign exchange (forex), equities, commodities and more.

Despite the uncertainty surrounding Brexit, the trading statement said that the UK’s exit from the European Union isn’t deterring firms from closing deals on some of its markets, even despite challenging conditions.

ForexClear Notional Value Increases YoY

The clearinghouse’s forex derivatives clearing service, ForexClear, which also achieved a record 2018, managed to note a slight improvement in the first quarter on a year-on-year comparison.

Specifically, the notional value cleared through ForexClear was $4.31 trillion in the first quarter, which is higher by one percent than the $4.29 trillion notional value cleared in Q1 of 2018.

Furthermore, the amount of ForexClear members also increased, with four new members joining the service since Q1 of 2018. This brings the total to 34 members.

David Schwimmer CEO of LSEG
David Schwimmer, CEO of LSEG
Source: LinkedIn

Commenting on the results, David Schwimmer, the CEO of LSEG said: “We continue to execute our strategy across our core businesses of Information Services, Post Trade and Capital Markets. In Post Trade, we acquired a stake in Euroclear, which shares our open access approach, and we updated our SwapClear agreement, which will deliver significant savings as we further develop the service.”

“We are investing in and growing our Information Services business, including developing our multi-asset and data and analytics offering. While equity markets were slower due to macroeconomic uncertainty, we have seen an improved listing environment in Q2.”

“The Group is strategically well positioned to develop its growth opportunities further in the evolving macroeconomic landscape.”

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