London Stock Exchange Says Supply Chains to Delay Tech Spend
London Stock Exchange Says Supply Chains Could Delay Tech Spend
(Bloomberg) -- Problems in the world’s supply chains have reached as far as London Stock Exchange Group Plc.
The bourse said in a third-quarter trading statement Friday that “supply chain pressures may impact the timing of some technology spend this year.” It said there was no change to its overall cost and capital expenditure guidance.
“We’ve seen a few weeks’ delay in the delivery of some particular tech hardware type items,” Chief Financial Officer Anna Manz said on a call with analysts. “It’s not impacting any of our transformation or integration project timing or any of our overarching change delivery.”
The warning shows that chip shortages and supply-chain snarls that have plagued manufacturers including carmakers are starting to affect server-hungry finance firms.
LSEG also said income will not grow as quickly in the fourth quarter as the prior three months, due to a strong 2020 comparison. It said the integration of data company Refinitiv remains on track.
“We are making excellent progress on the integration of Refinitiv and are comfortably on-track to achieve 125 million pounds of cost synergies in 2021, ahead of our original phasing,” Chief Executive Officer David Schwimmer said in a statement.
The shares were down 3.4% at 10:47 a.m. in London.
LSEG acquired Refinitiv for $27 billion in January, meaning most of its revenue now comes from data services. Investors were spooked by higher-than-expected costs linked to the integration earlier in the year.
Total income rose 7.6% in the third quarter, adjusted for the acquisition and currency movements.
Equities revenues rose 15.4%, helped by high-profile listings in London including Wise Plc. The U.K. is rewriting its stock market rules in the hopes of attracting more technology firms to list in London.
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