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The London Stock Exchange Group said on Thursday it was optimistic about a recovery in stock market listings, as the stock exchange operator revealed the damage caused by a dearth of initial public offerings in the United Kingdom last year.
LSEG said revenue from IPO and stock market trading fell 8.8% year-on-year in 2023 to £227m, reflecting a quiet 12 months for the listing.
“2023 was a bad year globally for IPOs, but the pipeline in 2024 is encouraging,” the group said.
A number of companies have recently chosen to dispose of their existing UK listings in favor of rival exchanges in New York and Frankfurt, citing the significant decline in liquidity in UK stock markets and the potential for higher valuations in the US.
The average daily value of publicly traded shares fell by 20 per cent to £3.7bn last year, further underscoring the reduced appetite for UK listed companies.
LSEG said it would launch a £1 billion share buyback this year, as it reported revenues of £8 billion in 2023, an increase of 7.8 per cent compared to the previous year.
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Stock market activity accounted for just 2.8 percent of revenue, with data and analytics bringing in the most money and accounting for two-thirds of revenue.
Operating profits at LSEG fell 3.2 per cent year-on-year to £1.4bn.
LSEG said higher interest rates helped lift the company's post-trade and clearing revenues by 19 percent, as traders sought to manage “uncertainty about the timing and magnitude of central bank interest rate moves.”
The company itself benefited from higher interest rates, generating £289 million in net treasury income, up 13 per cent on the previous year.
