LSE 1st-half net profit drops 40 percent

[November 25, 2009]  LONDON (AP) -- The London Stock Exchange PLC posted a 40 percent drop in first-half earnings on Wednesday on the back of lower trading and warned that market conditions remain uncertain.

The bourse reported net profit of 49.3 million pounds ($82.4 million) for the six months ended Sept. 30, down from 81.7 million pounds a year ago.

Revenues fell 9 percent to 310.9 million pounds, from 342.5 million pounds, as the exchange was also hit by increased competition.

"Underlying market conditions remain uncertain, at least in the near term, and competition in cash equities trading is expected to remain intense," it said in a statement.

The LSE has been losing market market share to multilateral trading facilities such as Chi-X and BATS since pan-European regulation opened the market to competition in 2007.

"Lower trading levels, together with intense competition from new trading venues with aggressive pricing, have contributed to lower equity trading revenues, the main area of decline for the group," it said.

The bourse added that the pipeline for initial public offerings remains promising for 2010, "although there is no certainty regarding the timing of new issues."

LSE shares were down 0.9 percent at 839.5 pence in midmorning trade.

[Associated Press]

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