© Reuters. FILE PHOTO: The offices of the London Stock Exchange in the City of London, Britain
By Huw Jones
LONDON (Reuters) -The London Stock Exchange Group (LON 🙂 announced a 3.9% increase in first-quarter revenue and said the savings from integrating its $ 27 billion acquisition of data and analytics company Refinitiv were in line with the objective.
About 40 million pounds ($ 55.5 million) of savings on the combined operating costs of the Refinitiv takeover were realized and new products were launched, the group said.
He said he remained confident of reaching 25% of the announced savings target of £ 350million by the end of 2021, in line with previous forecasts.
The group finalized its $ 27 billion buyout of Refinitiv in January, turning the 300-year-old stock exchange into an overnight capital market data giant, though still number two behind leader Bloomberg LP.
In March, he scared the markets by claiming that the integration of Refinitiv would cost $ 1 billion more than expected, causing LSE shares to fall. They have fallen about 20% since March 4, although the stock has climbed more than 2% on Wednesday.
In another setback, Refinitiv’s data terminals suffered a power outage lasting several hours this month.
The group said it would hold investor events to give a “deeper insight” into the newly expanded business, with the first on July 2 providing a snapshot of the data and analysis.
RBC analysts said the “robust” first quarter numbers indicated a good start in realizing cost synergies. Total income of £ 1.68 billion and gross profit of £ 1.5 billion were both in line with market expectations, he said.
The group said its divestment from Borsa Italiana is progressing and is expected to be completed in the second quarter.
The LSE had announced that it would sell the Milan Stock Exchange in order to obtain approval for its takeover of Refinitiv by the European Union’s competition regulators. Euronext buys the Italian stock exchange.
The LSE holds its annual meeting online at 11:00 GMT on Wednesday. The ISS Advisory Group recommends that shareholders vote against the 25% salary increase for CEO David Schwimmer due to the higher than expected costs of integrating Refinitiv.
Thomson reuters (NYSE :), the parent company of Reuters News, owns a 15% stake in LSE following the Refinitiv deal.
(1 USD = 0.7206 pounds)
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