LSE defies tough market conditions The London Stock Exchange produced strong results on Friday as it defied tough market conditions, helped by its diversification into areas beyond its traditional equity trading business. Profits came in above market expectations as the group performed well across its main businesses of capital markets, information technology and post-trade services in the six months up to September 30. Xavier Rolet, chief executive, said: "I am pleased with these results in difficult market conditions. We are operating a diversified business and that is paying off. If you look at the balance of the products in our portfolio, you can see we are no longer reliant on our UK equities business. To our critics, I say we are operating a diversified business that is well placed to grow. Some analysts warned there would be tougher times ahead as they say regulatory changes will curb the LSE Group's post-trade services business, a driver behind its profits numbers. Peter Lenardos, head of diversified financials at RBC Capital Markets, said: "These are good results. Adjusted operating profits are £17m above our expectations as a result of stronger profit margins across the range of its businesses. Another senior City analyst said: "The results are good, but the group must beware. Treasury income through its clearing business will suffer as new regulations mean deposits must be placed on a secured basis, which is safer but pays less. Adjusted operating profits rose to £217m, up 1 per cent compared with the first six months of the year, comfortably beating market expectations. Total income was £423.7m, up 10 per cent and above forecasts; total revenue was £349.8m, up 7 per cent in line with expectations; while net debt was £663m, also broadly in line forecasts. Total revenue was £349.8m, made up of £129.7 for the capital markets business, £44.6m for post-trade services, £147.6m for information services, £25.6m for technology services and £2.3m for other areas. Post-trade services saw total income, including net treasury income, grow 6 per cent to £112.7m, up 16 per cent. Treasury income through CC&G central counterparty business increased 38 per cent to £68.1m. The group is pressing ahead with its acquisition of LCH.Clearnet, the European clearing house, in which it will buy a majority stake, and stressed it could ride out problems over regulations that will restrict profits from its counterparty business. LSE Group shares suffered in late September after the group said European Union regulations would cut income at its Italian central counterparty business and that a capital boost might be required at LCH. Clearnet.