The exchange has made the move as it looks to invest more in its growing business, signalling a change in direction under recently appointed chief executive and former Goldman Sachs veteran David Schwimmer. LSE had been targeting a profit margin of around 55 percent this year and operating expense growth of four percent. But the exchange said in its full-year financial results statement on Friday morning: “Prioritisation of further investment in growth opportunities means the group does not plan to achieve cost and group margin targets in 2019.”
Mr Schwimmer, who only assumed his position in August, added in a media call LSE will cut around 250 jobs from its global workforce of 4,405 this year as it continues to focus on efficiencies.
He said in a statement: “As a systemically important financial markets infrastructure business, the group has a responsibility to ensure the orderly functioning of markets and continuity of service for its customers, shareholders and other stakeholders.
“The Group continues to advocate strongly for a defined implementation period and the prevention of the fragmentation of regulatory systems designed to make financial markets efficient, stable and safe.”
The full-year figures revealed pre-tax profits from continuing operations rose by more than a fifth (21 percent) last year to £685million off the back of eight percent revenue growth to £1.9billion.
LSE has increased its total dividend for last year to 60.4 pence per share, reflecting the “confident outlook” for the group.
Mr Schwimmer said in the financial report its businesses, especially those thought to be “most exposed to Brexit” are still performing well, and not yet feeling any impact from the UK’s proposed exit from the European Union.
The chief executive added the plan for 2019 will be continuing to invest in its businesses and increase “group-wide collaboration”.
He said: “LSEG continues to be well positioned in an evolving macroeconomic and regulatory landscape.
“Our businesses, including those perceived to be most exposed to Brexit, such as clearing, continue to perform very well, with no change in our market position.
“The strategic positioning of each of our businesses has reinforced for me the continued opportunities for growth.
“We will continue to invest in our businesses and to increase Group-wide collaboration to better meet the needs of our clients and to continue to drive strong returns for our shareholders.”
In January, LSE announced it had acquired a 4.92percent stake in Brussels-based financial services company Euroclear for £241.9million.
At the time, the exchange said it expected the minority investment to strengthen it ongoing operational and commercial with Euroclear.
In December, LSE upped its stake in clearing house LCH to 82.6percent at a cost of £384million.
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