London Stock Exchange Holds International Financial Reporting Standards Presentation

London Stock Exchange plc will tomorrow hold a technical presentation for analysts and investors, to provide an overview of the impact of International Financial Reporting Standards (IFRS) on the Exchange’s financial statements. The first full reporting under IFRS by the Exchange will be for the six months ending 30 September 2005.

As expected, the key accounting changes under IFRS that affect the Exchange relate to goodwill amortisation, pensions, share based payments, lease rentals, property depreciation and dividends.

To illustrate the impact of IFRS on the Exchange, it is estimated that for the year ended 31 March 2004:

• profit before tax under IFRS would have been £92.7 million, 4 per cent higher than £88.8 million under UK GAAP;
• IFRS basic earnings per share would have been 23.0 pence, compared with UK GAAP basic earnings per share of 21.6 pence, 6 per cent higher; and
• adjusted earnings per share, before goodwill amortisation and exceptional items, would have been 22.0 pence under IFRS, 4 per cent higher than 21.2 pence per share under UK GAAP.

Net assets as at 31 March 2004 are estimated to be £345.6 million under IFRS, 5 per cent lower compared with £365.7 million under UK GAAP, in part reflecting the Company’s decision on transition to IFRS to fully recognise the defined benefit pension deficit in reserves and restate retained freehold properties to fair value.

The presentation slides will be available tomorrow on the company’s website www.londonstockexchange.com.