WELCOME Second Quarter Financial Year 2011

Transcription

1 WELCOME Second Quarter Financial Year January 2011

2 Analyst and Media Briefing Magnus Böcker, CEO Seck Wai Kwong, CFO

3 Agenda 1. Highlights 2. Financial Performance 3. Business Update 4. Questions & Answers 3

4 Second Quarter Highlights Stronger quarter in securities & derivatives markets Proposed ASX-SGX Combination creating the premier Asia Pacific exchange Expanded reach Issuer Services: Larger IPOs; Bond listings New Securities & Derivatives members Clearing: OTC Financial Derivatives Securities: GlobalQuote & Chi-East Derivatives: Euro STOXX50; FTSE Xinhua China A50; Nikkei options 2Q 3Q 4Q 1Q 2Q FY 2010 FY 2011 (Note: The above exclude (a) CEO transition costs $6.3M in 2Q FY2010; (b) Impairment adjustments $2.3M in 4Q FY2010; (c) ASX-SGX transaction related costs $7.5M in 2Q FY

5 Financial Performance Seck Wai Kwong 5 5

6 Financial Performance Net Profit $82M ($77M) Solid quarter: Revenue up across all businesses Net Profit up 6%; EBITDA up 15%; and Operating Profit up 12% (1Q FY11 comparatives) EBITDA $95M ($100M) $110M Operating profit $90M ($91M) $101M Earnings per share 7.2 cents (7.0 cents) 7.7 cents Return on equity 11.1% (8.7%) 11.3% [Excludes (a) CEO transition costs $6.3M in 2Q FY2010; (b) ASX-SGX transaction related costs $7.5M in 2Q FY2011. Some numbers may be subject to rounding] 6 6

7 Financial Performance Revenues: $172M ($151M) Increased securities & derivatives trading volumes Increased institutional volume SDAV $1.8B from $1.4B Capped trades, 46% from 37% F&O DAV 248k from 222k USD depreciation by 6% Increased connectivity New Members Increased institutional trades 172 2Q Securities Derivatives Market Data Member Services & Connectivity Depository Services Issuer Services 2Q FY11 (% Revenue) (47%) (20%) (5%) (5%) (14%) (9%) (100%) ($M) 2Q FY Q FY Q [Note: Some numbers may be subject to rounding] 7 7

8 Financial Performance Expenses: $72M ($61M) Technology investments: SGXClear; OTC Clearing; the Reach initiative Maintain capex guidance $60-65M Expect ASX-SGX transaction related costs in FY2011: $20M ($7.5M in 2Q) Increased Technology activities Salary investments adjustments Job Credit Scheme 72 2Q Staff Technology Processing & Royalties Premises Professional fees Others 2Q FY11 (% Expenses) (39%) (36%) (9%) (7%) (3%) (6%) (100%) ($M) 2Q FY Q FY Q [Excludes (a) CEO transition costs $6.3M in 2Q FY2010; (b) ASX-SGX transaction related costs $7.5M in 2Q FY2011. Some numbers may be subject to rounding] 8 8

9 Financial Indicators (Adjusted) 2Q FY11 1Q FY11 4Q 3Q 2Q EBITDA ($M) Operating Profit ($M) Net Profit ($M) Total Equity ($M) Return on Equity (%) Per Share (cents) Operating Cash Flow Earnings Dividend No. of shares issued (M) 1,071 1,071 1,071 1,070 1,070 Note 1: Except for Earnings Per Share data, the above excludes (a) CEO transition costs $6.3M in 2Q ; (b) Impairment adjustments $2.3M in 4Q ; (c) ASX-SGX transaction related costs $7.5M in 2Q FY11 Note 2: Return on Equity is on 12-month rolling basis Note 3: The above number of shares issued includes treasury shares of 4.3M for 2Q FY11 and 5.2M for other quarters Note 4: Some numbers may be subject to rounding 9 9

10 Business Update Magnus Böcker 10 10

11 Securities: Trading and Clearing Revenue: $81M, 47% ($67M, 45%) Market Structure Continuous all day trading Remote trading membership Turnover velocity Products & Services GlobalQuote Chi-East Key drivers 2Q FY11 1Q FY11 Metrics 4Q 3Q 2Q MSCI Singapore Index No. of Trading Days Equity Turnover Velocity (%) Singapore issuers Overseas issuers, excluding Chinese issuers Chinese issuers Daily Average Trading Volume (billion shares) Daily Average Trading Value ($ billion) ETFs/ETNs ($ million) Company warrants Contracts value More than $1.5M Less than $1.5M Securities Revenue ($M) (Source: WFE, 1Q FY11 = Jul to Sep 10; 2Q = Oct to Dec 10) [Note: Some numbers may be subject to rounding] 11 11

12 Derivatives: Trading & Clearing Revenue: $34M, 20% ($31M, 21%) Market Structure Open connectivity for registration of off-market large trades Product Development OTC financial derivatives FTSE Xinhua China A50; Nikkei options; Nikkei Dividend futures Pipeline Nifty options & metal contracts t Derivatives Revenue ($M) Metrics Key drivers 2Q FY11 1Q FY11 4Q FY 10 3Q 2Q Daily Average Volume ( 000 contracts) Nikkei 225 futures (days) (61) (63) (61) (60) (61) MSCI Taiwan futures (days) (66) (65) (63) (56) (66) Nifty futures (days) (63) (65) (63) (59) (60) MSCI SG futures (days) (64) (64) (63) (61) (64) FTSE Xinhua A50, 7, in contracts (days) (61) (63) (60) (58) (60) Nikkei options, in 7,318 1, contracts (days) (61) (63) (61) (60) (61) Interest rate futures Extended settlement (shares) 122,953 41,000 47,222 80,705 66,547 Structured t warrants ($M) Market Share (%) Nikkei 225 futures MSCI Taiwan futures Nifty futures HFT (%) [Note: Some numbers may be subject to rounding] Commodities (Daily average trading volume, contracts) Rubber futures ,009 1,106 Gold futures 1,935 2,590 5,158 8,530 NA Fuel Oil futures AsiaClear Volume (lots) cleared 40,873 48,175 31,764 35,782 37,347 FFAs 21,259 27,004 13,420 20,920 26,448 Energy swaps 11,676 11,610 10,615 7,288 6,431 Iron Ore swaps 7,938 9,561 7,729 7,574 4,

13 Market Data: Information sales & distribution Revenue: $8M, 5% ($8M, 5%) Market Structure Evolving trading strategies: demand for low latency offering Products and Services Derivatives pricefeed Low latency feed (Nov 10) DerivativesQuote Level 1 fee revision (Apr 11) Pipeline Non-price market data Commodities quote Key drivers Securities Data 2Q FY11 1Q FY11 Metrics 4Q 3Q 2Q No. of vendors No. of terminals (Average) Derivatives Data 40,032 37,816 38,703 40,607 36,717 No. of vendors No. of terminals (Average) 23,614 23,810 24,168 24,842 25,158 13

14 Member Services and Connectivity Revenue: $10M, 5% ($8M, 5%) Membership Metrics New securities members Key drivers 2Q FY11 1Q FY11 4Q 3Q 2Q New derivatives clearing members Reach Initiative Co-location: On track for 4Q launch SGX Reach: FY 2012 Member Services and Connectivity Revenue ($M) [Note: Some numbers may be subject to rounding] Membership Securities members Trading Representatives Trading Members Clearing Members Derivatives members Trading Member (Individual) Trading Member (Proprietary) Trading Members Clearing Members SICOM members Trade / Associate Members Clearing / Non-Clearing Members: Brokers / Dealers AsiaClear No. of counterparties Connectivity Securities Market Connectivity (no.) Order Management System (no.) Independent software vendor (no.) Derivatives Market Connectivity (no.) Order Management System (no.) Independent software vendor (no.) Proximity Hosting

15 Depository Services: Settlement & Depository Revenue: $23M, 14% ($20M, 13%) Market Structure Settlement of institutional trades Services & Asset Classes Key drivers Securities settlement 2Q FY11 1Q FY11 Metrics 4Q 3Q 2Q No. of settlement instructions ( 000) 1,365 1,169 1,124 1,049 1,048 Contracts processing Contracts processed ( 000) 2,991 2,848 2,966 3,050 3,032 Growing securities borrowing and lending Depository management Depository accounts 1.53M 1.50M 1.49M 1.48M 1.47M Expanding asset classes Depository Services Revenue ($M) and services [Note: Some numbers may be subject to rounding] 15

16 Issuer Services: Listing and related services Revenue: $16M, 9% ($16M, 11%) Capital Raising Equity: New Listings Fixed income: Bonds/Notes Issuer-related services Metrics Key drivers 4Q 2Q 2Q FY11 1Q FY11 3Q Listings No. of listed issues Equity securities Debt securities 1,313 1,258 1,229 1,198 1,164 ETFs/ETNs Company warrants Structured warrants No. of Delistings: Equity securities Equity Market Capitalisation, $B (No. of issuers) 902 (782) 856 (779) 781 (783) 758 (782) 745 (781) Singapore issuers (461) (457) (460) (461) (459) Overseas issuers, excluding Chinese issuers (165) (167) (169) (166) (166) Chinese issuers (156) (155) (154) (155) (156) New equity listings Primary listings: IPOs & RTOs (Market capitalisation, $M) 12 (15,718) 8 (670) 11 (3,758) 6 (1,616) 12 (8,791) Secondary listings (Market capitalisation, $M) 0 (-) 0 (-) 1 (27,647) 1 (1,238) 0 (-) Total Equity Funds Raised ($M) 7,258 1,467 1,132 1,054 8,075 Primary funds raised 4, ,004 Secondary funds raised 2,321 1, ,071 Corporate actions No. of transactions Issuer Services Revenue ($M) (Source: WFE, 1Q FY11 = Jul to Sep 10; 2Q = Oct to Dec 10) 16 16

17 In summary Proposed ASX-SGX combination creating the premier Asia Pacific exchange Market structure Continuous all day trading Remote trading members for securities market SICOM contracts on SGX platform Products & Services OTC financial derivatives GlobalQuote Nifty options Metal contracts in collaboration with London Metal Exchange Technology Co-location services & SGX Reach 17 17

18 Creating the Premier Asia Pacific Exchange Landmark combination at heart of global growth International exchange group with improved strategic positioning to capitalise on Asia Pacific growth Greater global relevance with enhanced growth opportunities Highly cash generative business model with increased resources to deliver new product & services Compelling transaction creating more value for shareholders EPS accretion delivering more value for shareholders Projected increase in absolute DPS in medium term with minimum 70% payout of NPAT Potential re-rating rating on improved growth prospects from complementary & diversified revenue streams Proactive engagement with all key stakeholders Systematic ti engagement to identify and address legitimate t concerns Constructive discussions ongoing with regulators and other key constituents Regulatory due process proceeding as planned, with ACCC confirmation obtained in December

19 QUESTIONS & ANSWERS

20 THANK YOU

21 Appendices

22 Securities Trading Value vs MSCI Singapore Index FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 (Source: Bloomberg) 22 22

23 Futures & Options Volume vs Volatility Futures & Options: DAV vs Volatility F&O DAV ('000 contracts) D Volatility (%) 0 FY2006 FY2007 FY2008 FY2009 FY2010 FY F&O DAV ('000 contracts) Nikkei225 Index TWSE Index Nifty Index MSCI SG Index (Source: Bloomberg) 23 23

24 While SGX and its affiliates have taken reasonable care to ensure the accuracy and completeness of the information provided in this presentation, they will not be liable for any loss or damage of any kind (whether direct, indirect or consequential losses or other economic loss of any kind) suffered due to any omission, error, inaccuracy, incompleteness, or otherwise, any reliance on such information. Neither SGX nor any of its affiliates shall be liable for the content of information provided by or quoted from third parties. Examples provided are for illustrative purposes only. The information in this presentation is subject to change without notice. Any recirculation, transmission or distribution of this presentation or any part thereof by any third party requires the prior written permission of SGX. SGX and its affiliates disclaim all responsibility and liability arising in connection with any unauthorised recirculation, transmission or distribution of this presentation or any part thereof