The following is a summary of the London Stock Exchange Group Plc (LDNXF) Q4 2023 Earnings Call Transcript:
Financial Performance:
The London Stock Exchange Group delivered robust compounded organic growth of 6.5% over the last 3 years, with Q4 growth at 8.5%.
All profits were converted to cash, facilitating investment in growth and platform development and a significant return of over £1 billion in buybacks to investors.
The company's total income increased by over 8%, with EBITDA seeing a nearly 9% rise.
LSEG achieved a margin of 50.3% in 2023, slightly ahead of guidance.
The company's revenue synergy run rate for 2023 was £158 million, with cost synergy achieving a run rate of £442 million.
All divisions experienced growth, with Data & Analytics growing 7.3%, Capital Markets growing 6.1%, and Post Trade growing by an impressive 17%.
The company managed to generate a substantial cash flow with operating cash standing at £3.2 billion and equity free cash flow at £1.8 billion.
Business Progress:
To accelerate its growth, LSEG plans to improve customer service, reform its sales and account management, and enhance existing products while launching new ones.
The company is focusing on commercialization of products, comprehensive sales training, and launching new products onto the recently launched e-commerce platform in 2024.
Significant partnership with Microsoft is advancing ahead of schedule, with revenues expected from it starting in 2025.
Amidst promising future opportunities, LSEG is focusing on expansion in clearing of derivatives on digital assets and CDS in U.S. market and improving service in FTSE Russell index business.
Robust feedback has been received for Workspace with increased active desktop time indicating successful adoption. More features are set to roll out in response to customer needs.
The company announced a proposed return of £1.2 billion to shareholders via share buybacks and another £1 billion share buyback in 2024.
LSEG is set to continue its efficiency drive across the platform, improving application quality, shifting towards cloud, and investing in a broad range of growth opportunities.
More details: LONDON STOCK EXCHANGE GROUP IR
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