LONDON (AP) — The London Stock Exchange, which owns markets in Britain and Italy, said yesterday that first-half net profit rose 26 percent as it managed to offset the impact of tougher competition with new services.

The LSE posted net profit of £62.2 million ($99 million) for the six months ending Sepember 30, compared with £49.3 million a year earlier. Revenue dipped one percent to £297.9 million.

The world's fourth biggest stock exchange said better results from across its different businesses, which include trading and information services, more than offset lower revenue from equities and UK derivatives trading because of choppy trading and increased competition from rivals.

"This was a good first-half performance, with the uplift in earnings reflecting contributions from our increasingly diversified international exchange business," said CEO Xavier Rolet. The company said it would raise interim dividend by five percent to 8.8 pence a share because of the improved results.

The LSE said it plans to migrate trading on the main UK market to its new pan-European Turquoise trading platform in early 2011 and will launch derivative trading by the second quarter.

Earlier this month, it informed regulators about a two-hour disruption to Turquoise, which had migrated to new faster trading technology, blaming it on a "suspicious" glitch.

The LSE said in its earnings report that it was an "isolated incident and although a thorough investigation is ongoing, it is clear that it was unconnected to the functioning of the trading platform itself."

The move to swifter technology is critical for the London exchange to compete with newer rivals such as Chi-X Europe and Bats Europe.

The exchange said the number of new issues on primary markets more than doubled, raising £18 billion in capital.

Trading volume on cash markets was up 21 percent and derivative trading increased 19 percent.