LSE pledges £250 million shareholder payback |
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Thu, 03 Nov 2005 20:05
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LONDON - The London Stock Exchange has promised to return £250 million to its shareholders as it reported a 15 percent increase in turnover amounting to £136.1 million.
The Exchange doubled its interim dividend to 4 pence and pushed its operating profits to more than £50 million in the six months ending September. However, pre-tax profits dipped to £29.4 million during the same period largely due to the £23.1 million goodwill impairment charge deducted for its EDX derivatives exchange project.
"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," commented Chris Gibson-Smith, the LSE's chairman.
"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."
LSE chief executive Clara Furse was upbeat about the prospects of the exchange. She has lately been involved in studying the bids for the exchange submitted by German stock market operator Deutsche Börse and Macquarie, the Australian bank.
“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," Ms Furse commented.
The LSE's upbeat reports come in a week when the Competition Commission gave the nod for potential bidders to pursue their interest in the LSE, subject to certain modifications in the ownership of LCH.Clearnet, the LSE's clearing house. Euronext and Deutsche Börse are in the race for the Exchange.
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Competition Commission renews debate over LSE takeover 