1
00:00:00,080 --> 00:00:04,000
Speaker 1: The ls Group CEO David Trimmer. David, really wonderful to

2
00:00:04,000 --> 00:00:06,200
Speaker 1: speak with you this morning. So you're gutting towards the

3
00:00:06,320 --> 00:00:09,479
Speaker 1: upper end, towards eight percent for the full year revenue.

4
00:00:09,560 --> 00:00:11,080
Speaker 1: What's getting you there? What's driving that?

5
00:00:12,760 --> 00:00:12,879
Speaker 2: Well?

6
00:00:12,920 --> 00:00:15,640
Speaker 3: We've just had another strong set of results from l

7
00:00:15,720 --> 00:00:19,159
Speaker 3: SEG and top line growth just under eight percent for

8
00:00:19,200 --> 00:00:22,280
Speaker 3: the first half, and it's been really broad based growth.

9
00:00:22,560 --> 00:00:26,360
Speaker 3: Our data and analytics business seven point six percent revenue growth,

10
00:00:26,760 --> 00:00:30,040
Speaker 3: our post trade business over nineteen percent revenue growth. So

11
00:00:30,720 --> 00:00:34,720
Speaker 3: very pleased with how the business is performing. We are

12
00:00:34,760 --> 00:00:37,479
Speaker 3: also seeing the continuing transformation of l SEG. It's very

13
00:00:37,560 --> 00:00:39,560
Speaker 3: much on track. We're seeing a number of our businesses

14
00:00:39,600 --> 00:00:42,120
Speaker 3: growing faster than they have in years.

15
00:00:42,760 --> 00:00:44,880
Speaker 4: The partnership with Microsoft is going very well.

16
00:00:45,360 --> 00:00:49,199
Speaker 3: So we just have a lot of confidence going into

17
00:00:49,720 --> 00:00:52,320
Speaker 3: the second half. We see great momentum in the business

18
00:00:52,320 --> 00:00:55,160
Speaker 3: and feel very comfortable with the upper end of that

19
00:00:55,200 --> 00:00:55,880
Speaker 3: guidance range.

20
00:00:57,320 --> 00:00:59,840
Speaker 2: David, good morning. I did not know you called yourselves

21
00:01:00,160 --> 00:01:02,600
Speaker 2: l SEG. I'm going to remember that one. Look. You said,

22
00:01:02,600 --> 00:01:05,880
Speaker 2: it's broad based growth, it's good numbers, good operating profit

23
00:01:05,920 --> 00:01:09,640
Speaker 2: out there, but it did missed analist estimates you can

24
00:01:09,680 --> 00:01:12,120
Speaker 2: you break down there what analysts got wrong, why they

25
00:01:12,120 --> 00:01:15,240
Speaker 2: were kind of overestimating or expecting even more from these numbers.

26
00:01:16,880 --> 00:01:21,200
Speaker 3: I think top line growth we have probably beaten estimates

27
00:01:21,200 --> 00:01:24,440
Speaker 3: a bit in terms of EPs. That might be a

28
00:01:24,480 --> 00:01:27,880
Speaker 3: little bit off, but that's largely given the higher tax rate.

29
00:01:28,800 --> 00:01:33,400
Speaker 3: So overall, the business is performing extremely well and our

30
00:01:33,400 --> 00:01:36,920
Speaker 3: strategy is working. This is a business that is very

31
00:01:36,920 --> 00:01:40,200
Speaker 3: well positioned for the era that we are in now,

32
00:01:40,200 --> 00:01:44,680
Speaker 3: which is an era of technologically driven change. So lots

33
00:01:44,680 --> 00:01:46,960
Speaker 3: of things going right in this business, and we're feeling

34
00:01:47,040 --> 00:01:47,720
Speaker 3: very good about it.

35
00:01:48,560 --> 00:01:50,240
Speaker 1: Yeah, and look, you know, we can see a lot

36
00:01:50,280 --> 00:01:51,920
Speaker 1: of a lot of this coming through from data and

37
00:01:52,280 --> 00:01:55,000
Speaker 1: analytics in subscriptions. But David, when it comes to the

38
00:01:55,040 --> 00:01:57,680
Speaker 1: IPO market, wouldn't you expect it to come back.

39
00:02:00,000 --> 00:02:04,000
Speaker 3: We've seen a pretty subdued IPO market around the world,

40
00:02:04,320 --> 00:02:07,559
Speaker 3: and given what's been going on with war in Europe,

41
00:02:07,640 --> 00:02:11,280
Speaker 3: with concerns about recession, with uncertainty about interest rates, frankly,

42
00:02:11,320 --> 00:02:16,160
Speaker 3: that's not very surprising. We are seeing a healthy pipeline

43
00:02:16,200 --> 00:02:18,200
Speaker 3: building up the IPO market.

44
00:02:18,800 --> 00:02:21,160
Speaker 4: It closes, it opens.

45
00:02:21,280 --> 00:02:24,800
Speaker 3: You know, it's been cyclical pretty much forever, so I

46
00:02:24,880 --> 00:02:28,600
Speaker 3: expect to see it opening up. Hard to tell exactly when,

47
00:02:28,639 --> 00:02:30,760
Speaker 3: but we're starting to see some green shoots now. We've

48
00:02:30,800 --> 00:02:35,600
Speaker 3: seen some successful offerings already at more recently, so we'll

49
00:02:35,600 --> 00:02:38,200
Speaker 3: see what happens in the second half, and optimistic about

50
00:02:38,240 --> 00:02:40,600
Speaker 3: it coming back strong and healthy.

51
00:02:42,600 --> 00:02:44,240
Speaker 2: I love your optimism. It's good to have a bit

52
00:02:44,280 --> 00:02:46,240
Speaker 2: of optimism, especially when it comes to the UK. It's

53
00:02:46,240 --> 00:02:49,840
Speaker 2: not in abundance out there. A lot of your group's

54
00:02:49,919 --> 00:02:53,280
Speaker 2: earnings come from clearing interst rate swaps. Now, is there

55
00:02:53,280 --> 00:02:56,359
Speaker 2: a risk that that clearing moves to the US when

56
00:02:56,400 --> 00:03:01,040
Speaker 2: the EU stops recognizing London clearing houses in operations.

57
00:03:02,800 --> 00:03:06,120
Speaker 3: I don't think we're at that point anymore. Here we are,

58
00:03:06,440 --> 00:03:08,320
Speaker 3: you know, twenty twenty three. This has been an ongoing

59
00:03:08,400 --> 00:03:11,000
Speaker 3: discussion for a number of years. I think we're well

60
00:03:11,000 --> 00:03:15,440
Speaker 3: past the point where there is a risk of LCCH

61
00:03:15,560 --> 00:03:18,919
Speaker 3: Limited being shut down in terms of its access to Europe.

62
00:03:18,960 --> 00:03:22,400
Speaker 3: I think the various stakeholders in the EU recognize how

63
00:03:22,440 --> 00:03:29,560
Speaker 3: important LCCH is to their institutions, to their banks, asset owners,

64
00:03:29,560 --> 00:03:30,000
Speaker 3: et cetera.

65
00:03:30,720 --> 00:03:34,040
Speaker 4: So there may be some kind of requirement.

66
00:03:33,680 --> 00:03:37,360
Speaker 3: For entities in the EU to have access have an

67
00:03:37,480 --> 00:03:41,800
Speaker 3: active account in an EU clearinghouse, but I don't think

68
00:03:41,840 --> 00:03:45,960
Speaker 3: it's a likelihood that you'll see a shutting down of

69
00:03:46,000 --> 00:03:48,480
Speaker 3: access to LCCH. And as you can see, the business

70
00:03:48,560 --> 00:03:52,400
Speaker 3: continues to perform extremely well. As I mentioned over nineteen

71
00:03:52,400 --> 00:03:56,480
Speaker 3: percent growth in our post trade business. A good amount

72
00:03:56,480 --> 00:03:58,840
Speaker 3: of that was driven by the strong performance of swap

73
00:03:58,880 --> 00:04:03,120
Speaker 3: clear or continue to see strong volumes there as the

74
00:04:03,120 --> 00:04:06,320
Speaker 3: markets are reacting to the interest rate environment and some

75
00:04:06,360 --> 00:04:09,360
Speaker 3: of the surprises, some of the uncertainty, so that business

76
00:04:09,400 --> 00:04:11,800
Speaker 3: continues to perform very very well.

77
00:04:11,960 --> 00:04:13,760
Speaker 1: Yeah. Look, look, we do feel like we're at a

78
00:04:13,800 --> 00:04:18,000
Speaker 1: precipice David of changing regulation and certainly one of that.

79
00:04:18,120 --> 00:04:20,560
Speaker 1: To bring it back to UK listing scenes around there

80
00:04:20,560 --> 00:04:23,720
Speaker 1: now pensions that push back on changes that would make

81
00:04:23,760 --> 00:04:28,640
Speaker 1: it easier to list, with concerns about shareholder protection. Do

82
00:04:28,680 --> 00:04:31,800
Speaker 1: you think those concerns are warranted when it comes to

83
00:04:31,839 --> 00:04:32,960
Speaker 1: listing rule changes.

84
00:04:34,240 --> 00:04:38,680
Speaker 3: I'm actually feeling very positive, i'll say bullish about the

85
00:04:38,800 --> 00:04:40,320
Speaker 3: environment in this market.

86
00:04:40,360 --> 00:04:42,680
Speaker 4: There are a lot of changes moving in the right direction.

87
00:04:43,640 --> 00:04:45,960
Speaker 3: You hear some comments questioning some of them, but I

88
00:04:46,000 --> 00:04:48,840
Speaker 3: think overall the momentum is very much moving in the

89
00:04:48,920 --> 00:04:53,320
Speaker 3: right direction. We're simplifying some of the listing requirements. The

90
00:04:53,480 --> 00:04:56,719
Speaker 3: disclosure requirements are going to be simplified and made more competitive.

91
00:04:57,000 --> 00:05:00,680
Speaker 3: We're introducing this intermittent trading venue which is generating a

92
00:05:00,680 --> 00:05:03,640
Speaker 3: lot of excitement both here in the UK but also

93
00:05:03,800 --> 00:05:07,240
Speaker 3: from privately held companies in the US. I think the

94
00:05:07,279 --> 00:05:11,160
Speaker 3: discussion around pension funds and consolidation of pension funds and

95
00:05:11,360 --> 00:05:16,360
Speaker 3: pension fund allocation more to private equity venture.

96
00:05:16,880 --> 00:05:18,440
Speaker 4: UK equities all very healthy.

97
00:05:18,440 --> 00:05:20,200
Speaker 3: It'll take a little bit of time on the pension

98
00:05:20,200 --> 00:05:23,240
Speaker 3: funds for that to have a significant impact, but all

99
00:05:23,320 --> 00:05:25,599
Speaker 3: of these areas are moving in the right direction. So

100
00:05:25,920 --> 00:05:29,159
Speaker 3: I actually feel, as I said, pretty positive about both

101
00:05:29,279 --> 00:05:32,000
Speaker 3: the momentum but the direction of travel for this market.

102
00:05:33,560 --> 00:05:37,600
Speaker 2: More optimism. What's the latest on your collaboration with Microsoft

103
00:05:37,800 --> 00:05:40,719
Speaker 2: than what benefits Art's cloud computing business bringing to the

104
00:05:40,880 --> 00:05:44,000
Speaker 2: LC group. I'm curious does this kind of overlap with

105
00:05:44,040 --> 00:05:47,360
Speaker 2: your plans too? I believe the line is harness AI technology.

106
00:05:47,839 --> 00:05:50,560
Speaker 2: I'm curious about how your plan to use generative AI

107
00:05:50,600 --> 00:05:51,160
Speaker 2: in particular.

108
00:05:52,400 --> 00:05:54,839
Speaker 3: So a lot going on in our partnership with Microsoft.

109
00:05:54,920 --> 00:05:57,760
Speaker 3: We announced this December of last year and have been

110
00:05:57,880 --> 00:06:00,560
Speaker 3: actively working together. We have hundreds of people around the

111
00:06:00,600 --> 00:06:05,840
Speaker 3: world building, working together, building product coding, and we expect

112
00:06:05,839 --> 00:06:07,960
Speaker 3: to roll out a number of new products in twenty

113
00:06:08,000 --> 00:06:11,440
Speaker 3: twenty four. Analytics as a service or modeling as a

114
00:06:11,440 --> 00:06:14,760
Speaker 3: service doesn't exist today, so this will be a new

115
00:06:14,800 --> 00:06:18,599
Speaker 3: capability that will really help our customers get access to

116
00:06:18,880 --> 00:06:23,440
Speaker 3: very powerful analytics and modeling capabilities. You touched on generative AI.

117
00:06:23,560 --> 00:06:25,839
Speaker 3: There's a lot going on in this space. We are

118
00:06:27,160 --> 00:06:31,200
Speaker 3: working with our customers to provide our data to them

119
00:06:31,440 --> 00:06:33,839
Speaker 3: in a mode that allows them to take advantage of

120
00:06:34,160 --> 00:06:36,480
Speaker 3: the large language model technology.

121
00:06:35,920 --> 00:06:36,880
Speaker 4: That's now available.

122
00:06:37,560 --> 00:06:41,320
Speaker 3: We are embedding our data and analytics and workflow in

123
00:06:41,400 --> 00:06:45,919
Speaker 3: Microsoft Teams and making it interoperable with the other productivity

124
00:06:45,920 --> 00:06:49,800
Speaker 3: tools at Microsoft offers like Excel, PowerPoint, and again we'll

125
00:06:49,800 --> 00:06:54,880
Speaker 3: be making their AI functionality available in each of these products.

126
00:06:55,240 --> 00:06:59,640
Speaker 3: So it's a pretty exciting opportunity both for us and

127
00:06:59,640 --> 00:07:00,520
Speaker 3: for our customers.

128
00:07:00,680 --> 00:07:01,880
Speaker 4: Another thing I should mention on this.

129
00:07:01,920 --> 00:07:04,600
Speaker 3: When we announced the partnership, a number of our customers

130
00:07:04,600 --> 00:07:07,680
Speaker 3: reached out to us asking how they could get involved

131
00:07:07,680 --> 00:07:09,560
Speaker 3: because they were so interested in what we're doing. So

132
00:07:09,600 --> 00:07:14,120
Speaker 3: we've formed a design partnership group with a number of

133
00:07:14,120 --> 00:07:16,440
Speaker 3: our big customers and they're working with us on the

134
00:07:16,480 --> 00:07:18,600
Speaker 3: design and we'll be working with us on beta.

135
00:07:18,400 --> 00:07:21,600
Speaker 4: Testing, etc. So a lot going on there. We also

136
00:07:21,680 --> 00:07:22,600
Speaker 4: have some.

137
00:07:22,560 --> 00:07:25,040
Speaker 3: Very interesting developments using some of this technology and other

138
00:07:25,080 --> 00:07:25,679
Speaker 3: parts of the group.

139
00:07:25,760 --> 00:07:27,040
Speaker 4: So a lot going on.

140
00:07:28,360 --> 00:07:30,760
Speaker 2: Okay, it sounds like perhaps too much for a seven

141
00:07:30,800 --> 00:07:33,400
Speaker 2: minute TV interview, but I'm impressed by the amount of

142
00:07:33,440 --> 00:07:36,360
Speaker 2: stuff you got in there. If Labor wins the next

143
00:07:36,400 --> 00:07:39,320
Speaker 2: general election, what difference would that make for your group.

144
00:07:41,600 --> 00:07:45,840
Speaker 3: I think there's a pretty strong consensus, bipartisan consensus in

145
00:07:45,920 --> 00:07:50,840
Speaker 3: this country on the different reforms and opportunities to improve

146
00:07:50,920 --> 00:07:56,080
Speaker 3: the competitiveness of the London market. So I think the

147
00:07:56,200 --> 00:07:59,240
Speaker 3: pension fund reform is a good example of that where

148
00:07:59,240 --> 00:08:02,320
Speaker 3: we've seen stor support from that across the political spectrum.

149
00:08:03,280 --> 00:08:06,040
Speaker 3: I think what we do is widely recognized to be

150
00:08:06,960 --> 00:08:10,200
Speaker 3: very important for both the UK economy but frankly for

151
00:08:10,240 --> 00:08:15,360
Speaker 3: the global financial system, and so we work with different

152
00:08:15,400 --> 00:08:18,400
Speaker 3: governments all over the world, regulators all.

153
00:08:18,320 --> 00:08:18,760
Speaker 4: Over the world.

154
00:08:18,840 --> 00:08:20,840
Speaker 3: It's part of what it is to be systemic market

155
00:08:20,840 --> 00:08:24,920
Speaker 3: infrastructure and we look forward to working with the government

156
00:08:24,920 --> 00:08:28,280
Speaker 3: here whichever way that goes in terms of any elections.

157
00:08:29,760 --> 00:08:32,000
Speaker 1: Give the word is at the moment that you're looking

158
00:08:32,000 --> 00:08:33,640
Speaker 1: for a new office, which is sad for us. Here

159
00:08:33,679 --> 00:08:36,719
Speaker 1: a Bloomberg because you're basically down the street for us.

160
00:08:36,960 --> 00:08:39,240
Speaker 1: How's that hunt going? Have you found a new spot yet?

161
00:08:39,280 --> 00:08:40,120
Speaker 1: Are you still look in.

162
00:08:41,679 --> 00:08:44,679
Speaker 3: So our business, as you can see, our business continues

163
00:08:44,720 --> 00:08:49,000
Speaker 3: to grow and continues to do very well, so we

164
00:08:49,080 --> 00:08:52,079
Speaker 3: are in that light. We're just evaluating what the options

165
00:08:52,080 --> 00:08:55,679
Speaker 3: are for us in the city of London and nothing

166
00:08:55,720 --> 00:08:58,640
Speaker 3: to report on at this point, but just evaluating our options.

167
00:09:00,280 --> 00:09:02,080
Speaker 1: You'll still be in the city, David, so you won't.

168
00:09:02,080 --> 00:09:04,559
Speaker 1: You won't be too far, good to hear David Trimmer.

169
00:09:04,600 --> 00:09:11,480
Speaker 4: There, LC Group CEO. Yes, sorry David, if we move

170
00:09:12,200 --> 00:09:12,640
Speaker 4: going far?

171
00:09:13,600 --> 00:09:16,480
Speaker 1: Okay, okay, good good, come come over stop by then

172
00:09:16,640 --> 00:09:19,280
Speaker 1: David Trimmer. Then again from the LC Group