All hail the return of the IPO as London Stock Exchange Group reports profit increase
The London Stock Exchange Group (LSE) has reported a 16 per cent increase in adjusted income to £323.9m for the three months ended 30 June 2014, with the company hailing a resurgence in the initial public offering (IPO) market.
In results which the group said showed "strong financial performance", it also reported a 20 per cent increase in overall revenue to £299.9m and a 36 per cent increase in operating profit to £102m.
A total of 78 issuers joined the market during the period, an increase on 33 for the same period last year, reflecting strong IPO activity. The total capital raised rose from £6.1bn to £20bn.
In June the FTSE 100 company agreed a $2.7bn (£1.6bn) deal to buy Russell Investments, the American index compiler and asset manager. Today, the company announced an underwritten share issue intended to raise £938m for the acquisition of Russell, which will make the LSE the second-largest provider of exchange-traded funds in the US, and the third-largest in the world.
Chief executive Xavier Rolot said:
We continue to make good progress, delivering a strong financial performance this quarter with an increase in operating profit, reflecting organic growth and inorganic revenues across the Group.We have seen a resurgence in the IPO market with an increase in both the number of companies joining our markets and the amount of money raised. While the summer period is seasonally slower, our diversified business is very well positioned for further growth.The proposed acquisition of Russell Investments will help to expand the global footprint of the Group, particularly in the key U.S. market.
Earlier in the week the LSE unveiled new board member Sharon Bowles who has joined the company as non-executive director. The company said Bowles, a former member of the European Parliament who served on the economic and monetary affairs committee, will bring "extensive knowledge of European and regulatory trends" to the board.