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DISCLAIMER This PDF is an exact copy of the Annual Report and Accounts of London Stock Exchange Group plc as provided to shareholders. The audit report is set out on page 92. The maintenance and integrity of the London Stock Exchange Group plc website is the responsibility of the directors; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. WorldReginfo - 44c04612-fd5a-4eb1-a747-8e626af2dc68 A global markets infrastructure business Annual Report 31 December 2015 WorldReginfo - 44c04612-fd5a-4eb1-a747-8e626af2dc68 London Stock Exchange Group plc Annual Report December 2015 Who we are London Stock Exchange Group is a global markets infrastructure business. We provide valuable services for a wide range of customers, focusing on Capital Formation, Risk and Balance Sheet Management and Intellectual Property. The Group plays a vital economic and social role in enabling companies to access funds for growth and development. Further information on London Stock Exchange Group can be found at: www.lseg.com. London Stock Exchange Group plc 10 Paternoster Square London EC4M 7LS Telephone: +44 (0)20 7797 1000 Registered in England and Wales No. 5369106 WorldReginfo - 44c04612-fd5a-4eb1-a747-8e626af2dc68 Contents STRATEGIC REPORT Highlights 2 An overview of our business, statements from Chairman’s statement 4 our Chairman and our Chief Executive, the Chief Executive’s statement 6 markets and regulatory environment in which Overview of Group activities 8 we operate, and strategy. More detail on each What we do 10 Our business model 11 of our divisions, our performance, how we Market trends and our response 12 consider our wider responsibilities and the Strategy in action 16 principal risks that could affect our business. Executive management team 18 Introduction to segmental review 20 Sign-off for the Strategic Report is provided Capital Markets 22 in the Directors’ Report on page 88. Post Trade Services – CC&G and Monte Titoli 26 Post Trade Services – LCH.Clearnet 28 Information Services 31 Technology Services 34 Our wider responsibility 36 Financial review 38 Risk management oversight 44 Principal risks and uncertainties 46 GOVERNANCE Board of Directors 54 An introduction to our Board of Directors, Corporate governance 57 our approach to corporate governance, the Report of the Nomination Committee 61 reports of committees to the Board and how Complying with the provisions of the Code 62 we reward performance, along with other Report of the Audit Committee 64 Report of the Risk Committee 68 statutory and regulatory information. Directors’ Remuneration Report 70 Directors’ Report 88 Statement of Directors’ responsibilities 91 Independent Auditor’s Report to the members of London Stock Exchange Group plc 92 GROUP FINANCIAL STATEMENTS Consolidated income statement 98 Detailed financial information setting out Consolidated statement of our performance for the reported 12 month comprehensive income 99 period and financial position at year end. Balance sheets 100 Cash flow statements 101 Statements of changes in equity 102 Notes to the financial statements 103 SHAREHOLDER INFORMATION Glossary 150 A glossary of terms used in this report Overview of regulatory landscape 152 and other information for shareholders. Financial calendar 154 Investor Relations 155 1 WorldReginfo - 44c04612-fd5a-4eb1-a747-8e626af2dc68 London Stock Exchange Group plc Annual Report December 2015 Highlights During 2014, the Group changed its financial year end to All figures in the 6 graphs below are for 12 month periods to 31 December. As a consequence, this report shows audited results either end of March or end of December (unless otherwise stated) for 12 months to 31 December 2015, and the comparative for the and include continuing and discontinuing operations. 9 months to 31 December 2014. To provide further insight, we also show comparative information on a calendar 12 month basis to 31 December 2014 (unaudited). Total income* Adjusted operating profit* £ m £ m 709.6 2,381.5 558.0 514.7 441.9 430.2 1,381.1 1,213.1 814.8 852.9 Mar Mar Mar Dec Dec Mar Mar Mar Dec Dec 2012 2013 2014 2014 2015 2012 2013 2014 2014 2015 Operating profit* Adjusted earnings per share (pence)* £ m 129.4 499.9 98.6 103.3 92.6 97.0 358.5 348.4 353.1 346.0 Mar Mar Mar Dec Dec Mar Mar Mar Dec Dec 2012 2013 2014 2014 2015 2012 2013 2014 2014 2015 Basic earnings per share (pence)* Dividends per share (pence)* 193.6 36.0 28.4 26.1 27.2 22.5 94.6 80.4 63.0 56.5 Mar Mar Mar Dec Dec Mar Mar Mar 9m Dec 12m Dec 2012 2013 2014 2014 2015 2012 2013 2014 2014 2015 12 months Dec 2015 12 months 12 months Dec 9 months Dec 2014 Total Variance Year ended 31 December Continuing Discontinued Total Dec 2014 (unaudited) % Total income £1,418.6m £962.9m £2,381.5m £1,043.9m £1,381.1m 72% Adjusted operating profit* £584.7m £124.9m £709.6m £417.5m £558.0m 27% Operating profit £404.4m £95.5m £499.9m £242.1m £346.0m 44% Adjusted profit before tax* £516.4m £127.0m £643.4m £368.2m £491.7m 31% Profit before tax £336.1m £97.6m £433.7m £191.0m £277.9m 56% Adjusted basic earnings per share* 103.4p 26.0p 129.4p 75.6p 103.3p 25% Basic earnings per share 74.8p 19.8p 94.6p 37.9p 56.5p 67% * London Stock Exchange Group uses non-GAAP performance measures as key financial indicators as the Board believes these better reflect the underlying performance of the business. From 2014, the Group changed its financial year end to 31 December. As a consequence, the above table shows comparison to the statutory results for the 9 months to 31 December 2014 and, to provide further insight, comparative information for a full calendar year 2014 (unaudited). Adjusted operating profit, adjusted profit before tax and adjusted earnings per share all exclude amortisation and impairment of purchased intangibles and goodwill and non-recurring items. 2 WorldReginfo - 44c04612-fd5a-4eb1-a747-8e626af2dc68 Strategic Report Highlights The Group is executing on its strategy, building best in class Group Total Continuing Income by segment* capabilities, driving global growth and developing opportunities £ m with our customers. A few examples of the progress being made are highlighted below: 12 months to 6 5 31 Dec 2015 Capital Markets 1 – Revenues for the year increased by 3% on an organic constant currency 1. Capital Markets 330.3 basis, down 1% in Sterling terms to £330.3 million (2014: £333.2 million) 2. Post Trade Services CC&G and Monte Titoli 119.1 – Primary Markets saw 176 new companies choosing to list on our markets, 3. Post Trade Services 4 2 with total money raised across our equity markets down 2% to £41.7 billion LCH.Clearnet 360.7 4. Information Services 517.4 – In Secondary Markets, UK cash equity average daily value traded increased by 7%, average daily number of trades in Italy increased by 6% and average 5. Technology Services 80.6 3 6. Other 10.5 daily value traded on Turquoise increased by 16% 1,418.6 – Volumes on IDEM, the Group’s Italian derivatives market, increased by 14% – In Fixed Income, MTS cash and BondVision value traded declined by 2%, while MTS Repo increased by 19% Information Services – Revenues for the year increased by 42% to £517.4 million (2014: – CurveGlobal, a joint venture with major dealer banks and CBOE, trading interest £363.7 million), with first full year contribution from Russell Indexes and rate futures to go live in 2016 good growth from UnaVista and SEDOL. On an organic constant currency basis revenues increased by 5% Post Trade Services – CC&G and Monte Titoli – Income for the year increased by 3% on a constant currency basis, – FTSE Russell launched as a single global brand with integrated in Sterling terms income declined by 8% to £119.1 million client facing teams – CC&G cleared 120.1 million contracts, up 10% – FTSE Russell signed licensing agreements with US derivatives exchanges CME and CBOE – Average initial margin held increased by 24% to €12.3 billion – Real time data revenues declined by 2% on lower UK user numbers – Monte Titoli was the largest CSD to participate in the initial wave of T2S – Continuing strong growth from UnaVista and SEDOL Post Trade Services – LCH.Clearnet Technology Services – LCH.Clearnet’s income for 2015 was £360.7 million, down 7% in sterling – Revenues for the year increased by 22% to £80.6 million (2014: £66.0 million) terms and down 4% on a constant currency basis. Excluding London Metal – A range of key worldwide technology deliveries and agreements were Exchange (LME) clearing revenue in 2014, income increased by 7% on completed with financial sector firms from Canada, India, Morocco, a constant currency basis Peru and South Africa – SwapClear, a leading interest rate swap clearing service globally, cleared – Exactpro Systems, acquired in 2015, specialises in functional and US$533 trillion notional, down 17%. Client trades cleared increased non-functional testing of systems that process wholesale financial by 67% to 678,000 products across multiple asset classes – Compression services at SwapClear reduced the level of notional outstanding – Shared Service Company launched, providing a range of technology from US$362 trillion to US$251 trillion at the end of 2015 services Group-wide – Cash equity clearing volumes increased by 21% to 549 million trades due to increases in the number of venues and customers served Other – Following a review of the investment management business of Frank Russell Company, the Group announced the agreed sale of this business in October 2015 with completion expected in H1 2016 FURTHER INFORMATION More detailed information on the performance of our business segments can be found on pages 20–35.

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