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The London Stock Exchange (LSE) reported a rise in annual revenue of 56 per cent to £546.4 million but shares fell on the company's outlook.

Adjusted basic earnings per share were up 30 per cent to 73.1p, while pre-tax profit was up 45 per cent to £234.7 million.

The bourse said the results were "excellent" and announced a total dividend for the year of 24p, up 33 per cent from last year.

The completion of its merger with Borsa Italiana helped boost profits and is expected to deliver approximately half of the £40 million synergies in the current financial year, with full run rate cost synergies by the start of next year, the LSE said.

Overall trading is up, the LSE added, with a total of 411 new issues in London and Milan. Over the year, 128 international companies joined the capital's markets, with more international IPOs than the other major European and US exchanges combined, LSE said.

However, in its outlook, the company said: "A number of new entrants have announced that they will establish pan-European trading operations in the coming year," sending shares down on fears of an influx of competition.

LSE is facing competition from several international rivals, including Japanese investment bank Nomura Holdings' Chi-X and Nasdaq OMX, due to launch in September.

The company said it is well positioned for the competition, and through "continuous investment in technology, development of a range of new market services and a tariff schedule structured to incentivise growth" it would stay ahead.

Chief executive of the exchange Clara Furse said despite "testing" conditions, the bourse delivered an excellent result.

She said: "In a dynamic market environment, we are confident of achieving further growth this year."