Improved profitability leads to updated margin projections by LSEG (London Stock Exchange Group)
London Stock Exchange Group Announces £1 Billion Share Buyback and Improved 2025 Guidance
The London Stock Exchange Group (LSEG) has revealed a series of significant developments, including a new £1 billion share buyback in the second half of 2025, improved 2025 margin guidance, and substantial investments in product innovation.
The company's strategic pipeline includes 250 enhancements to Workspace, the sunset of Eikon, the launch of DigitalAssetClear and Treasury Futures clearing with FMX, and a partnership with FTSE Russell and StepStone for private company indices. These moves aim to bolster the Group's position in the financial market.
In terms of financial performance, the company's total income (excluding recoveries) increased by 7.8% in the first half of the year, with a 7.8% growth in Q2 and a 6.8% growth on a reported basis. The engineering transformation within the company is driving product culture and margin improvement, with 52% of engineering resource now in-house.
The reported EPS grew by an impressive 89.6% at actual rates, and the adjusted EBITDA margin improved by 100 bps, with a constant currency margin improvement of 150 bps, and a -50 bps of FX-related impacts. The company generated strong cash flow, with equity free cash flow of £935 million, a 43.6% increase.
The company has returned £500 million via buybacks in H1, and intends to return up to a further £1 billion in H2. As a result, the interim dividend has been raised by 14.6% to 47.0p per share, and the interim dividend will be paid on 17 September 2025 to all shareholders on the share register at the record date of 15 August 2025. The ex-dividend date is 14 August 2025.
The updated 2025 guidance includes an organic constant currency growth in total income (excl. recoveries) of 6.5-7.5%, a constant currency EBITDA margin of +75-100 bps, capex intensity of c. 10%, equity free cash flow of at least £2.4 billion, and an underlying effective tax rate of 24-25%.
The company's Asset Supported Value (ASV) growth at June 2025 was 5.8%, a decrease from the 6.4% growth in Q1, due to expected competition response to the company's improved performance. No new information on ASV growth, adjusted EBITDA margin improvement, adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) growth, adjusted earnings per share (EPS) growth, reported EPS growth, or cash flow generation was provided in this paragraph.
All divisions of the company performed well, with Data & Analytics growing by 5.1%, FTSE Russell by 7.6%, Risk Intelligence by 12.2%, and Markets by 10.7%. The company has launched Excel and PowerPoint Workspace add-ins, the Workspace app in Teams, and Company Fundamentals in the Data-as-a-Service platform, as part of its progress with Microsoft.
The launch of DigitalAssetClear and Treasury Futures clearing with FMX, and the partnership with FTSE Russell and StepStone for private company indices, are strategic moves that aim to strengthen the company's position in the digital asset and private markets. The reported EPS growth of 20.1% at actual rates, benefiting from lower net finance expenses, the buy-in of LCH minorities in 2024, and ongoing share buybacks, further underscores the company's financial strength.
[1]: Source: London Stock Exchange Group plc (LSEG) press release [3]: Source: London Stock Exchange Group plc (LSEG) press release [5]: Source: London Stock Exchange Group plc (LSEG) press release
The London Stock Exchange Group (LSEG) plans to take advantage of its financial strength by returning up to an additional £1 billion via share buybacks in the second half of 2025, and this move demonstrates their commitment towards investing in the business. In light of these developments and their strategic investments, LSEG aims to solidify its position in the digital asset and private markets, as well as the financial market as a whole.
){kind=link}