London Stock Exchange cuts 250 jobs as it looks to save £30m
Group to reduce staff numbers by 5% and warns it won’t meet its profit margin target this year
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Your support makes all the difference.The owner of the London Stock Exchange will cut 250 jobs as it looks to make £30m of cost savings.
Despite revenues and profits both rising, the London Stock Exchange Group announced on Friday that it would lay off about 5 per cent of its workforce and said it did not expect to meet its targeted profit margin in 2019.
The job cuts will come from across LSE’s operations and focus on cutting duplication, chief executive David Schwimmer said.
He told reporters: “We are very well prepared for whatever comes from a Brexit situation.
“We expect international growth opportunities to offset any market headwinds in 2019.”
Operating profits rose 14 per cent to £751m in 2018, while revenue jumped 8 per cent to £1.9bn.
However, Mr Schwimmer, who took over after the controversial departure of former boss Xavier Rolet, told investors that LSE does not expect to meet earnings targets.
“Prioritisation of further investment in growth opportunities means the group does not plan to achieve cost and group margin targets in 2019,” the firm said.
The LSE’s share trading platform Turquoise is seeking a licence to operate in Amsterdam to serve customers after Brexit, with authorisation from Dutch regulators imminent, according to Mr Schwimmer.
If the UK secures a Brexit transition period with the EU, share trading of euro-denominated stocks would remain in London, the chief executive said.
LSE recently appointed Experian’s Don Robert as chairman following a bitter boardroom dispute.
The group also recently paid €438m (£384m) to up its stake in British clearing house LCH to more than 80 per cent.
LSE received a boost last month when LCH was recognised by the European Securities and Markets Authority (Esma).
The company processes deals in commodities, securities and derivatives and is one of three London firms that dominate the European clearing business.
Other European financial hubs, including Paris and Frankfurt, hope to prise much of that lucrative business away from London after Brexit.
But Esma said recognising London’s clearing houses for 12 months after Brexit would “limit the risk of disruption in central clearing and to avoid any negative impact on the financial stability of the EU”.
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