· Continued execution against strategic objectives and investment drives multiple growth opportunities across each of our market-leading businesses
· Strong financial performance across all business areas with good control of underlying costs – positioned for delivering strong operational leverage
· Successful strategy based on customer partnership, innovation and an Open Access model makes the Group strongly positioned to make further progress as a well diversified financial markets infrastructure business with a global footprint
2016 Highlights
· Total income up 17% to £1,657.1 million (2015: £1,418.6 million)
· Total revenue up 14% to £1,515.6 million (2015: £1,324.7 million)
· Adjusted operating expenses2 continue to be well controlled, at £791.6 million – up 4% on an organic and constant currency basis as the Group invests in growth and efficiency projects
· FTSE Russell delivered strong growth and integration synergies of US$78 million p.a. are ahead of schedule; on track to reach €40 million of annual cost savings at LCH by end of 2017
· Adjusted operating profit2 up 17% at £685.8 million (2015: £584.7 million); operating profit of £426.8 million (2015: £404.4 million); adjusted profit before tax2 up 21% at £623.1 million (2015: £516.4 million)
· Adjusted EPS2 up 21% at 124.7 pence (2015: 103.4 pence); basic EPS of 63.8 pence (2015: 74.8 pence)
· Proposed final dividend increased to 31.2 pence per share – a 20% increase in the full year dividend to 43.2 pence per share – reflecting the strong outlook for the Group
· New initiatives and achievements in the year include:
– SwapClear saw a 25% increase in clearing volumes at over US$665 trillion notional and provided record compression of US$384 trillion; new portfolio margining service, LCH Spider, launched on an open access basis
– CurveGlobal, a new listed interest rate futures platform, successfully launched in partnership with major dealer banks and CBOE – onboarding a growing number of clients and increased trading flow
– Continued volume growth at CDSClear and ForexClear – driven by regulatory changes
– FTSE Russell launched a Low Carbon Economy data model and accompanying Green Revenue Index Series
– Announced acquisition of Mergent Inc., a leading US provider of business and financial information on companies, to further build the Information Services portfolio
– ELITE, our platform for high growth companies, now operational in 25 countries with nearly 500 companies
· Sale of Russell Investment Management successfully completed, for gross proceeds of US$1,150 million – resulting in an implied multiple of 18x EBITDA (pre synergies) for the retained, high growth Russell Indices business, now integrated with FTSE
· The Group continues to work hard on its proposed merger with Deutsche Börse AG – awaiting outcome of the European Commission Phase II process on or before 3 April 2017