Bursa Malaysia Berhad Merrill Lynch Global Emerging Markets Conference, California

Transcription

1 Bursa Malaysia Berhad Merrill Lynch Global Emerging Markets Conference, California Tun Mohamed Dzaiddin Hj. Abdullah, Chairman Dato Yusli Mohamed Yusoff, CEO 5-7 June 2007 Disclaimer The contents of this presentation include materials which may be capable of being interpreted as forward-looking statements. Such statements are merely predictions and targets, based on circumstances and reasonable assumptions which apply only at the date of such statements. Accordingly, no reliance should be placed on any forward-looking statements, express or implied, contained in this presentation.

2 Single Exchange Group Offering a full range of exchange-related products Equities Market Derivatives Market Offshore Market 3 markets (Main Board, Second Board, MESDAQ Market) MB : 642 cos SB : 246 cos MM: 129 cos 9 derivatives products Commodity futures Equity futures & options Financial futures Non-ringgit securities Islamic Sukuk cross listings 4 Total Market Capitalisation: USD312bil (RM1,061bil) as at 31 May 2007 Horizontal Integration Across Products to different issuer and investor groups 2

3 Organisational Structure 1 Executive Director 3 Shareholder Directors 5 Independent Directors 4 Public Interest Directors BOARD OF DIRECTORS CHIEF EXECUTIVE OFFICER GROUP INTERNAL AUDIT & RISK MANAGEMENT CHIEF OPERATING OFFICER Functional Units CHIEF REGULATORY OFFICER Business Units GROUP BUSINESS DEVELOPMENT EXCHANGES, CLEARING, SETTLEMENT & DEPOSITORY INFORMATION SERVICES GLOBAL MARKETS FINANCE LEGAL & COMPLIANCE INFORMATION TECHNOLOGY GROUP HUMAN RESOURCES & ADMINISTRATION GROUP STRATEGY Regulations INVESTIGATION & ENFORCEMENT ISSUES & LISTINGS INTERMEDIARY & SUPERVISION SURVEILLANCE 3

4 Q1 Results A sign of times to come? FY2005 (RM) FY2006 (RM) Change Q (RM) Q * (RM) Change Operating Revenue mil 262 mil 36% 58.3 mil mil 113% Operating Expenses mil mil 3% 37.5 mil 39.4 mil 5% Operating EBITDA 61.5 mil mil 111% 24.8 mil 88.2 mil 256% PAT 80.9 mil mil 35% 23.0 mil 70.2 mil 205% EPS 15.9 sen 21 sen 32% 4.3 sen 13.5 sen 214% * Condensed Consolidated Financial Statements for Q including the commentaries are available at Investor Relations section 4

5 Ratios heading in the right direction FY2005 FY2006 Change Q Q Change Annualised ROE 12.8% 6.6% 93% 10.0% 33.2% 232% Operating EBITDA Margin 32.0% 49.5% 55% 42.5% 71.0% 67% Net Profit Margin 29.9% 35.8% 20% 31.2% 51.5% 65% Stable Revenue : Total Operating Expenses 53.0% 50.7% 4% 50.0% 58.2% 16% 5

6 Driven by a strengthening market Equity Velocity YTD FY2006 Change Q May 07 Change 32.5% 30% 64% 113% 25% Market Capitalisation RM849 bil 22% RM733 bil RM1.1 tri 50% Daily Average Trading Value RM1.1 bil 42% RM1.0 bil RM2.7 bil 170% Daily Average Trading Volume 876 mil 94% 838 mil 2.0 bil 139% Derivatives Daily Average Contracts 16,915 70% 11,703 26, % 6

7 On Target to Achieve KPIs 2007 Target Q Exceeded Target By Velocity 40% 68% 70% Annualised ROE 16.8% 33.2% 98% Derivatives Daily Average Contracts 40% growth 54% growth 14% 7

8 Revenues remain dependant on equities trading Q : RM58.3 mil Q : RM124.3 mil Trading revenue (Derivatives) RM5.9 mil 10% Trading revenue (Derivatives) RM12.9 mil 56% 10% 32% * Stable revenue RM18.8 mil 70% 19% 1% * Stable revenue RM23.0 mil Trading revenue (Equities) RM32.7 mil 2% ** Other operating revenue RM0.9 mil Trading revenue (Equities) RM86.8 mil ** Other operating revenue RM1.6 mil * Stable revenue comprises information services, listing fees, depository services, participants fees and broker services ** Other operating revenue comprises mainly perusal and processing fees 8

9 Whilst Operating Expenses contained Q RM37.5 mil Q RM39.4 mil IT maintenance RM4.4 mil Staff cost RM18.5 mil IT maintenance RM3.8 mil Staff cost RM18.2 mil Building maintenance RM1.8 mil 5% 10% 12% 49% Building maintenance RM2.3 mil 6% 8% 10% Staff cost 46% RM55.8 mil Depreciation & amortisation RM3.9 mil 24% Other operating expenses* RM8.9 mil Depreciation & amortisation RM3.3 mil 30% Other operating expenses* RM11.8 mil * Other operating expenses comprises market promotion, legal, audit and professional fees etc. 9

10 Resulting in our high operating leverage Revenues to Expenses Ratio Q106 Q206 Q306 Q406 Q107 Q106 Q206 Q306 Q406 Q107 Equities Trading Revenue* Stable Revenue Operating Expenses Derivatives Trading Revenue Other Operating Revenue * Excludes SC levy (Clearing fee is 0.04% ad valorem, subject to a cap of RM500 per trade, of which 18.75% is SC levy) 10

11 Growing Stable Revenue with more to come Q : RM18.8 mil Q : RM23.0 mil RM1.0 mil 5% RM3.9 mil 21% RM2.7 mil 14% RM1.1 mil RM4.9 mil 5% 26% RM6.3 mil 34% RM4.0 mil 17% RM4.7 mil 20% RM6.4 mil 28% RM6.8 mil 30% Information Services Listing Fees Participants Fees * Depository Services Broker Services ** * Participants Fees comprises of application/admission/initial/registration fee, participants subscriptions and renewal fees ** Broker Services comprises of SCORE/Data Comm equipment rental income from brokers/adm at a certain fixed monthly rate. 11

12 In 2007, Our Focus Will Be On Primary Improve Sustainable Velocity Secondary Improve quality internal structure and processes

13 Bursa s s Sustainable Velocity Target : 60% by 2010 Turnover Velocity for the past 12 months to April 2007 Philippine SE Bombay SE Bursa Malaysia Jakarta SE New Zealand Exchange Thailand SE Singapore Exchange 1 Nat ional Stock Exchange India 25.6% 28. 8% 48.0% 49.3% 49.6% YTD 31 May 07 : 64% 60.3% 61.9% 62.9% Still low in comparison with other regional exchanges Hong Kong Exchanges Aust ralian SE 64. 6% 91.0% Euronext Tokyo SE London SE Taiwan SE Corp. NYSE Korea Exchange 120.5% % % 135.0% 143.0% % Shanghai SE 190.3% Shenzhen SE % 0.0% 50. 0% % 150.0% 200.0% % 300.0% % 13

14 Three Key Areas Will Be Infrastructure : improve efficiency & access Products : broaden & internationalise product base Additional Market Initiatives 14

15 Initiative update : Infrastructure 1 Equities Bursa Trade 1b (Equity Trading Platform) Q407 Direct Market Access (Derivatives) Sep07 Fixed Income Electronic Trading Platform Q108 Outsourcing Technology JV with AEMS Q407 15

16 Initiatives Update : Products 2 Equities FTSE BURSA 30 ETF Oct07 National ETF Dec07 Futures FTSE BURSA 30 Oct07 USD based FCPO Sep07 FTSE Bursa Index Series Tradable Shariah Index May07 16

17 Additional Market Initiatives 3 PLC access CMDF Bursa Research Scheme Good Investor Relations Practices Protect market integrity Revised delisting criteria Action against malpractice and manipulation CSR Framework Retail Market Plan Rebranding Perception Management 17

18 Surplus cash under constant review RM million * Financial resources available for 31 March ** Shareholders 31 March Capital Expenditure for * Inclusive of RM 85 mil set aside for Clearing Guaranteed Fund ** After 2006 final dividend of RM53 mil 18

19 Dividend Policy 75% To Ensure We Generate Value For Shareholders sen capital repayment 25 G ross D ividend / Share ( Sen) FY 2005 = 91% 10 sen 10 sen FY 2006 = 92% 12.5 sen 14 sen 28 sen special dividend Total Shareholders Return since IPO = 302% (Capital Gain + Dividends + Special Dividend) 257% increase in share price since IPO 33% increase in share price YTD 2007 Assumption: Based on IPO price of RM3.00 and last done price on 31 st May 2007 of RM Interim FY2005 Final FY2005 Gross Dividend/Share Gross Dividend/Share Interim FY2006 Final FY2006 % of dividend payment % of dividend payout excluding special dividend & capital repayment 19

20 A Favourable Malaysian Economy Real growth projected at about 6% Conducive domestic interest rates for economic activities, overnight policy rate of 3.5% Manageable Inflation, 2007 CPI is forecast at about 2.0% The strengthening Ringgit, up 11.7% since de-peg in mid-2005 Ninth Malaysia Plan charts the expansion path of the local economy 20

21 With Increased Corporate Activity RM bn Maxis buyout by Binariang GSM Sdn. Bhd. BCHB acquires Southern Bank Daikin acquires OYL Industries ANZ acquires stake in AMMB PNB mega plantation merger Synergy Drive 31.4 PPB Group plantation consolidation exercise under Wilmar International 2.3 Genting Group wins SGD5.2bn Sentosa casino license 11.9 More active approach to globalisation and foreign investment interest. 21

22 GLC reforms significant progress- Increase free float ROE and Share Performance: More than half of 20 leading listed GLCs achieved YoY ROE improvements in FY2006 and better share price performance. Market capitalization: Increased by RM83 billion since May (20 top GLCs) Earnings Increment: FY 2006, 20 top GLCs of the 48 listed GLCs achieved a very commendable 60% increase in earnings over FY X earnings growth rate of the broader market. Total Shareholder s Return: (14 May March 2007) of 20 top GLCs is 71.8%, outperforming the KLCI ex-g-20 by 4.9%. Analyst Expectation: Most are on track in meeting analysts expectation of combined earnings growth of 43% YoY in FY2007. Source: Putrajaya Committee on GLC High Performance(PCG)/ Khazanah, March

23 Regional Market Capitalisation Mkt Capitalisation (US$ billion) Hong Kong South Korea Taiwan Singapore Malaysia Thailand Indonesia Philippines Source: WFE and KMIS (for Malaysia) End-2006 (Mkt Cap) End- April 2007 (Mkt Cap) 23

24 Offers one of the highest dividend yields Regional Comparison Dividend Yield Thailand (SET) 4.08% Malaysia (KLCI) Australia (AS30) Taiwan (TWSE) 3.22% 3.38% 3.33% 3.38 % Singapore (STI) 3.10% Hong Kong (HSI) 2.86% Philippines (PCOMP) 2.25% Indonesia (JCI) 2.00% South Korea (Kospi) 1.73% China (Shanghai-A) 0.48% 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% Dividend Yield Source: Bloomberg, Dividend yield for main regional indices as at 31 May

25 Bursa Is Committed Towards Making Our Market Place More Attractive Increase Depth of Products and Services CMDF Bursa Research Scheme Restricted Short Selling & Stock Borrowing Lending Real Estate Investment Trusts Exchange Traded Funds FTSE- Bursa indices Single Stock Futures Structured Warrants ASEAN Index Products Foreign Listings/Dual Listings Internationalise CPO prices Improving Infrastructure, Distribution Channels and Lowering Taxes Admission of 5 foreign brokers (UBS, CLSA, CSFB, Macquarie, JP Morgan) Admission of 3 foreign fund managers (Aberdeen, Nomura, BNP Paribas) Accelerate Tax restructuring; Removal of Real Property Gain Tax; REITS 15% local and 20% foreign; Corporate tax 2006:28%; 2007 : 27%; 2008 : 26% 25

26 BURSA MALAYSIA TODAY IS A Must Have in Investment Portfolios 26

27 Appendix : Market Statistics Please visit us at : 27

28 Total Listings & Market Valuation Market Valuation & Listed Companies , YTD 31 May 07 Market Valuation (Billion RM) Total Listed Cos Funds mobilised (primary and secondary markets) 2006 = RM4.1b, 2005 = RM8.5b 28

29 New Listings Rate of new listings decreased due to tightening of entry criteria ia Number of New Listings YTD 31 May 07 Main Board Second Board MESDAQ Market Total New Listings 29

30 Increasing Velocity : Quarterly % % % 698 Historical High Value RM5.6 b 05 Jan 1994 RM5.3 b 28 Feb % % 910 1Q2005 2Q2005 3Q2005 4Q2005 1Q2006 2Q2006 3Q2006 4Q2006 1Q2007 YTD 31 May 07 38% % % 68% % 70% 64% 60% 50% 40% 30% 20% 10% 0% Daily Average Market Transacted Volume (million units) Daily Average Market Transacted Value (million RM) Turnover Velocity 30

31 Increasing Velocity : Annually Daily Average Volume, Value and Velocity 68% 69% 64% % % 58% % % 40% % % 25% 33% % % % % 40% 30% 20% % YTD 31 May 07 Daily Average Volume (million units) Daily Average Value (million RM) Turnover Velocity 0% 31

32 Improved Activity in Derivatives 0,000 Derivatives Hit New Record! FKLI = 41,748 contracts on 27 Feb , ,000 5,000 0,000 5,000 93,600 FCPO = 37,231 contracts on 13 June 07 Total contracts = 53,865 on 27 Feb , ,500 92,000 81,800 84, ,628 19, , ,737 21,757 26,037 26, , ,000 70,000 0,000 5,000 10,939 9,542 9,823 9,578 11,703 14,500 20,000 0 Q105 Q205 Q305 Q405 Q106 Q206 Q306 Q406 Q107 YTD 31 May 07-30,000 Daily AverageVolume Open Position 32

33 KLCI New All Time High Closing 1, points as at 21 June 2007 (YTD %) - Returns for Year 2006 Year-to-Date Returns of Selected Stockmarkets on 31/05/07 Shanghai-A, China : 2, % Shanghai A, China 53.10% JCI, Indonesia : 1, PCOMP, Philippines : 2, % 42.29% KLCI, Malaysia 22.86% FTSE/ASEAN 40 : 7, % FTSE BURSA 30, Malaysia 22.29% HSI, Hong Kong : 19, % Kospi, South Korea 18.57% STI, Singapore : 2, % FTSE/Asean % KLCI, Malaysia : 1, % STI, Singapore 17.59% FTSE-BURSA Large 30 : 7, % DJIA, USA 9.39% TWSE, Taiwan : 7, % SET, Thailand 8.47% Dow Jones, US : 12, % FTSE, UK : 6, % Bursa Malaysia S&P500, USA 7.89% Nasdaq Comp, US : 2, % Asia-Pacific Markets Nasdaq, USA 7.34% Nikkei-225, Japan : 17, % Other Markets TWSE, Taiwan 4.11% Kospi, South Korea : 1, % HSI, Hong Kong 3.77% -4.75% SET, Thailand : Nikkei 225, - Japan 3.35% % % -5.00% 15.00% 35.00% 55.00% 75.00% 95.00% % % -22.5% -12.5% 2.5% 7.5% 17.5% 27.5% 37.5% 47.5% Percentage Change (end-december 2005 to end-december 2006) Returns (%) 57.5% 33

34 Sustained Foreign Trading Participation 45,000 40,000 35, ,000 25,000 20,000 15,000 10, , Jan-06 Apr-06 Jul-06 Oct-06 Jan-07 Apr-07 Total Foreign Trading (RM billion) % of Foreign Trading 34

35 Foreign Trading Participation Has Improved Local & Foreign Trading Participation 1993 to April % 15% 82% 18% 69% 31% 81% 19% 76% 24% 73% 27% 83% 17% 78% 22% 71% 34% 68% 32% 76% 24% 69% 31% 63% 37% 66% 35% 66% 34% YT April 07 Local Investors Foreign Investors 35

36 Retail Investors Continue To Participate Breakdown of trading (by value) 1993 to April % 45% 44% 54% 44% 49% 59% 54% 43% 40% 50% 43% 29% 34% 39% 51% 48% 45% 36% 42% 43% 35% 40% 51% 54% 45% 53% 71% 66% 61% 7% 7% 11% 10% 14% 8% 6% 6% 6% 6% 5% 3% YT April Retail Institutions Others 07 Others - refers to trades conducted for accounts not belonging to individuals/ institutions. Definitions of investors type clarified in 2004, hence reducing the type of investor falling under others category. 36