Singapore Exchange Limited FY2004 Full Year Results

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1 Singapore Exchange Limited FY2004 Full Year Results Hsieh Fu Hua, CEO Seck Wai Kwong, CFO Singapore Exchange 29 July 2004

2 Agenda 1. CEO s Message & Highlights 2. Financial Review 3. Strategy Update 4. Q & A 2

3 CEO s Message Hsieh Fu Hua Chief Executive Officer 3

4 CEO s Message Building a robust business Restructuring for efficiency and customer focus Discipline in cost and capital management Open connectivity 4

5 Highlights of FY2004 Full Year Results 5

5% Return on Equity Return on Equity Mid-teens 20.8% 11.6% Dividend per per Share (Gross) 6.5 6.5 11.0 11.

6 FY 2004 Results Net Net Profit After Tax Tax Delivering results Market Expectations Performance Change from FY03 S$115.5 S$133.0M S$128.4M S$67M (1) Cost-to-income 50% 50% 54% 54% 48.8% (2) 19.5% Return on Equity Return on Equity Mid-teens 20.8% 11.6% Dividend per per Share (Gross) cents (1) Excludes impairment loss on properties in FY03 (2) Excludes provision for surplus leased premises utilised S$4.4M (3) Includes special dividend 13.5 cents (3) 7.0 cents 6

7 Financial Review Full Year Results ended 30 June 2004 Seck Wai Kwong Chief Financial Officer 7

8 Income Statement Profitability improved (in S$MM) FY04 FY03 % Change Operating Revenue Operating Expenses Operating Profit Securities trading Net Non-Operating Revenue Exceptional item (0.3) (50.0) NM Derivatives trading Net Profit Before Tax & MI Tax & MI Net Profit After Tax & MI Cost discipline Net Profit After Tax & MI (excl exceptional item)

Operating Revenue Strong improvement High in operating securities leverage revenue (in S$MM) 350 300 250 184 200 114 165 150 100 160 154 100 39 43 50 50 76 70% 75 74% 83 86% 0 FY 02 FY 03 FY 04

9 Operating Revenue Strong improvement High in operating securities leverage revenue (in S$MM) % 75 74% 83 86% 0 FY 02 FY 03 FY 04 Stable Derivatives Clearing Rev Securities Mkt Rev* Operating Expenses Record securities trading Coverage of operating expenses 86% - FY 04 74% - FY 03 Asian Derivatives Listing Fees Data Services 70% - FY 02 Operating * Securities expenses market revenue exclude includes provision clearing for fees surplus and account leased maintenance premises & processing [FY02-04] fees & provision for SGX- MAS Stable Market revenue Development includes all other Scheme securities [FY03] and derivatives revenues 9

10 Operating Expenses Continued financial discipline Declining costs Miscellaneous Cost of sales Depreciation System main t & rental Occupancy costs Headcount & base salary Revision of rental rates & expiration of leased premises Sub-lease of surplus premises System support services Fully depreciated assets Staff costs The above excludes (a) Provision for Surplus Leased Premises [FY02-04], and (b) Provision for SGX-MAS Market Development Scheme [FY03] Variable bonus Fees to MAS for transfer of PS function 10

11 Performance at a Glance Enhancing shareholder value FY 2004 FY 2003 (1) Change Return on Equity (2) Return on Equity (2) 20.8% 9.2% +11.6% Cost to Income 48.8% (3) 68.3% -19.5% Net Profit Margin 42.0% 32.6% +9.4% Dividend per Share (gross) (cents) 13.5 (1) Excludes non-recurring & exceptional items, Annual Report 2003 (2) Net profit after tax divided by shareholders equity as at period end (3) Excludes provision for surplus leased premises utilised S$4.4M

12 New Dividend Policy Gross Dividend per Share (in cents) Our commitment to shareholders Special Raise minimum dividend per share and maintain payout 50% NPAT FY02 FY03 FY04 12

13 New Dividend Policy Net Dividend per Share (in cents) Our commitment to shareholders 10.8 Special Up from 5.1 cents to 5.6 cents FY02 FY03 FY04 13

14 Comparison of Dividend Yield SGX A good dividend play Dividend Yield (%) Singapore Listed Companies 8.0 Various Exchanges F&N SPH UOB DBS OCBC SGX HKEx ASX Euronext LSE Deutsche Borse SGX Mainboard Exchange Average Source: Bloomberg, SGX Dividend yield = Gross dividend of last FY / last traded 30 June 04; excludes capital-related special dividend & capital return 14

15 Strategy Update Hsieh Fu Hua Chief Executive Officer 15

16 Strategic Direction Domestic Growth Exchange linkages Equity options Extend Beyond Asian Hub Exchange linkages Asian Derivatives Foreign listings Data business Membership Grow from the Core Foreign listings E-migration Membership Capital management HR Change management In/Out-sourcing Open connectivity Defend the Business 16

17 Grow from the core: Securities Market Building regional growth platform for foreign issuers 75 Breakdown of New Issuers Domestic Foreign 69 [119, 21%] [437, 79%] Local vs Foreign Issuers Foreign Local [69, 22%] 19 [249, 78%] FY2000 FY2001 FY2002 FY2003 FY2004 Excludes all secondary listings except for Jardine Matheson Group of Companies Market Capitalisation (S$bn) As at end Mar 04 17

18 Grow from the core: Securities Market 450% 400% 350% 300% 250% 200% 150% 100% 50% 0% Jul-00 Domestic Stocks Foreign Stocks China Sep-00 Nov-00 Jan-01 Mar-01 May-01 Jul-01 Sep-01 Nov-01 Jan-02 Mar-02 May-02 Jul-02 Sep-02 Nov-02 Jan-03 Excludes all secondary listings except for Jardine Matheson Group of Companies Foreign stocks are actively traded on SGX Mar-03 May-03 Jul-03 FY2004 Sep-03 Nov-03 Jan-04 Mar-04 May-04 Domestic Stocks Turnover Velocity 63% Foreign Stocks Turnover Velocity 100% China Stocks Turnover Velocity 234% 18

19 Our securities market A growing market 250 Average y-o-y growth: 8% 208 Trading Value (in S$ Billion FY 1994 FY 1995 FY 1996 FY 1997 FY 1998 FY 1999 FY 2000 FY 2001 FY 2002 FY 2003 FY

20 Grow from the core: Derivatives Market Focus on higher margin products Contracts (in '000) 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000-18,346 13,134 Robust Growth in Asian Derivatives 8.4% 20,674 14, % 15,241 19,716 FY2002 FY2003 FY2004 Asian Derivatives Others 20

21 Grow from the core: Derivatives Market Focus on higher margin products Average Derivatives Clearing Fees per contract (S$) Leading to Higher Average Clearing Fees per Contract FY2002 FY2003 FY

22 Extending Beyond: Strategic Alliances CME NYMEX Amex NSE TSE Bursa M sia SGX ASX 22

23 Our Investment Story Strong stable revenue base leveraged to market growth Attractive dividend policy Discipline in cost & capital management A superior ROE 23

24 Comparison of Total Shareholder Return From 1 Jul 2003 to 30 Jun 2004 SGX A rewarding stock Singapore Listed Companies Various Exchanges TSR (%) F&N SPH UOB DBS OCBC SGX HKEx ASX Euronext LSE* Deutsche Borse STI Exchange Average * Includes special dividend payable in Aug 04 Source: Bloomberg 24

25 Comparison of Total Shareholder Return From 1 Jul 2002 to 30 Jun 2004 SGX A rewarding stock 110 Singapore Listed Companies Various Exchanges TSR (%) F&N SPH UOB DBS OCBC SGX HKEx ASX Euronext LSE* Deutsche Borse STI Exchange Average * Includes special dividend payable in Aug 04 Source: Bloomberg 25

26 Q & A Panel: 1. Hsieh Fu Hua, CEO 2. Seck Wai Kwong, CFO 26

Singapore Exchange Limited FY2005 Full Year Results Presentation

Singapore Exchange Limited FY2005 Full Year Results Presentation Hsieh Fu Hua, CEO Seck Wai Kwong, CFO Singapore Exchange 28 July 2005 1 Agenda 1. Highlights 2. Financial Review 3. Strategy Update 4. Q