1H 2018 KEY REVENUE ANALYSIS. All data utilised is publicly available

Transcription

1 KEY REVENUE ANALYSIS All data utilised is publicly available

2 Revenue movements vs Total revenue and other income Depository fees $59m Network fees $42m Market data fees $24m Others $25m 8,194 6, , (11) (9) ,399 one-off postliquidation interest from Lehman liquidators Cash Market Cash Market clearing fees Derivatives Market LME LME clearing fees Stock Exchange listing fees Others Net investment income (NII) Revenue other than NII 2

3 Cash Market 1 based on volume change Trading fees and trading tariff +729 ADT Average daily number of trades $76.0bn + 67% $126.6bn 1,139K + 52% 1,729K 121 Funds raised (2) 28 Southbound (3) 21 Northbound (4) 18 ETF (5) % x ( %) x (1 + 0%) x (1+8%) x (1 + 0%) ,765 1,776 Trading tariff Trading fees 1, x (1 + 68% (1) ) x (1 + 0%) x (1 + 52%) x (1 + 0%) x ( %) x (1+ 179%) x (1-1%) x (1 + 9%) - 18 d trading tariff: $134m (6) d (7) : $816m (1, ) (7) trading tariff Effect of Funds raised (2) Effect of Southbound of Stock Connect Effect of Northbound of Stock Connect (3) (4) Effect of ETF(5) Change vs Cash Market and trading tariff move closely with changes in total value of trades and number of trades (1) Refers to % change in Headline ADT (ie, Stock Exchange trades (including DWs, CBBCs and warrants)) less SB ADT/2 less ETF ADT (including L&I Product): : $113.1bn; : $67.2bn; 68% (Headline ADT : $126.6bn; : $76.0bn SB ADT : $16.3bn; : $7.6bn ETF (including L&I Product) ADT : $5.4bn; : $5.0bn) (2) Funds raised x 0.005% x 2 sides (Funds raised - : $585.0bn; : $277.0bn; 111%) (3) Southbound (SB) : ADT of SB x no. of trading days x 0.005% x 50% (SB ADT: : $16.3bn; : $7.6bn; 114%; No. of trading days: & 2017: 110 days) (4) Northbound (NB) : ADT of NB x no. of trading days x % x 40% (NB ADT: : RMB19.8bn; : RMB7.1bn; 179%; No. of trading days: : 113 days; : 114 days; 1%; Exchange rate: : 1.22; : 1.12; 9%). (5) ETF (including L&I Product) trading fee = ADT x 0.005% x 2 sides x no. of trading days x (1 exemption %) (ADT 1H 2018: $5.4bn; : $5.0bn; 8%). Exemption % is approximately 50%. (6) Trading tariff of equity products traded on the Stock Exchange (included under the Cash segment) of $114m is disclosed in the 2018 Interim Report. Trading tariff of DWs, CBBCs and warrants (included under the Equity and Financial Derivatives Segment) is estimated by average daily no. of trades (169K) x no. of trading days (121) x $0.5 x 2 sides = $20m. (7) Excluding arising from funds raised, Stock Connect and ETFs (including L&I Products) 3

4 Cash Market clearing fees 2 based on volume change Clearing fees for Cash Market (CM) and fees for SIs +515 ADT (1) Average daily value of SI $76.0bn + 67% $126.6bn $204.1bn +45% $296.2bn % Fees (SIs) Clearing Fees (CM) x (1 + 67%) x (1 + 0%) x (1 + 45%) x (1 + 0%) ,503 1, ,165 Fees (SIs) Clearing Fees (CM) clearing fees (CM) fees for SIs increase in CM fees of $446m or 62% was lower than estimate due to increase in average transaction size (: $73k; : $67k) that resulted in a lower proportion of Cash Market trades being subject to the minimum fee increase in SIs of $69m or 33% was lower than estimate due to more SI transactions being subject to the maximum fee due to higher average transaction size (: $2.7m; : $2.3m) Change vs Clearing fees and SI fees move with total value of trades and total value of SIs but are also impacted by transaction sizes of the trades/sis. In general, if the average transaction size increases, it will have a negative impact on the clearing fees and vice versa (1) For Stock Exchange trades (including DWs, CBBCs and warrants), excluding stock options 4

5 Derivatives Market 3 based on volume and sales mix change Derivatives Market (1) +436 HKFE ADV Stock Options ADV 425k + 55% 659k 355k + 62% 574k % % , ,008 Stock Options HKFE x (1 + 55%) x (1+0%) ( ) x 6.5% 73 x (1 + 62%) x (1 + 0%) - 73 ( ) x 61% HKFE volume change HKFE sales mix change Stock Options volume change Stock Optoins sales mix change Key Products Unit fee ($) Contract proportion (2) HSI Futures & Options % 37% HSCEI Futures & Options + Mini HSI Futures % 60% Mini HSCEI Futures 2.0 4% 3% Average fee per contract Change vs +6.5% Average fee per contract 6.5% due to higher proportion in related to higher fee products Key Products Unit fee ($) Contract proportion Tier % 14% Tier % 52% Tier % 34% Average fee per contract Average fee per contract 60% due to higher proportion in related to Tier 1 contracts +61% Derivatives Market generally move with the total number of contracts traded and average fee per contract (1) Includes allocated to the Clearing segment (2) Calculated based on % of total contracts of key products (ie, HSI Futures & Options, HSCEI Futures & Options and Mini HSI & HSCEI Futures) 5

6 LME trading and clearing fees 4 based on volume change and short and medium-dated carry fee reduction LME -11 LME clearing fees -9 Chargeable ADV Chargeable ADV 594k + 11% 659k 594k + 11% 659k % 125 ( ) x -10.7% % x (1 + 11%) x (1 + 0%) (67) x (1 + 11%) x (1 + 0%) ( ) x -13.4% (41) Volume change d short and mediumdated carry fee (1) adjustment Volume change d short and mediumdated carry fee (1) adjustment Q (2) Q (2) Fee ($m) Total volume of chargeable contracts (m) Average fee per contract % Fee ($m) Total volume of chargeable contracts (m) Average fee per contract % Change vs prior period LME and LMEC fees move with total number of contracts traded and the adjustments arising from fee reduction of short and medium-dated carries. (1) Fee changed effective from 1 October 2017 for short-dated carries and from 1 November 2017 for medium-dated carries. (2) Latest statistics published by HKEX 6

7 Stock Exchange listing fees 5 s based on no. of listed companies and newly listed DWs/CBBCs Stock Exchange listing fees ,013 Average no. of listed co. (1) No. of newly listed CBBCs + 8% 2,182 4,732 12, % DWs 3,034 5, % Derivatives segment Cash segment x 83% x 8% 195 x 32% x 171% x 68% x 91% annual listing fees (Cash segment) newly listed CBBCs & DWs Approximately 83% of listing fees in Cash Segment are annual listing fees based on FY2017 ($687m/$828m), which move with the changes in the average no. of listed companies Unit fee per CBBC/DW = 0.3 Ratio of fee from CBBC/DW in = 4,732 x 0.3 : 3,034 = 32%:68% Change vs Stock Exchange listing fees move closely with changes in no. of listed companies and newly listed DWs/CBBCs. (1) Average number of listed companies represents the average number of listed companies at month end 7

8 of revenue Total revenue and other income Excluding NII ,120 8,194 6, , (5) (11) ,299 7,399 one-off postliquidation interest from Lehman liquidators Cash Market Cash Market clearing fees Derivatives Market LME LME clearing fees Stock Exchange listing fees Net investment income (NII) Revenue other than NII for revenue estimates (excluding NII) approximately $100m or 1% 8

9 EBITDA margin EBITDA margin generally moves in the same direction with revenue REVENUE OPEX EBITDA 13,375 13,180 11,116 9,849 8, ,777 2,958 3,290 3,455 3, % 73%? - 68% 70% 69% A significant proportion of opex is fixed in nature If revenue comes under pressure, non-critical projects may be deferred and costs control measures will be implemented to try to maintain an overall EBITDA margin in the region of 65% - 70% (: 77%) 5,946 6,891 10,085 7,661 9, EBITDA margin 9