Interim report Third quarter of 2013

Transcription

1 Interim report Third quarter of 2013

2 Main features of the third quarter: Continuing high level of activity in the fixed income market Two equity listings approved in Q3, seven so far in 2013 Currently increased interest for IPOs Increased savings and growth in value for VPS-registered mutual funds increases AUM Continuing good performance for projects and underlying costs Operating revenue: NOK million (192.9) EBITDA NOK million (82.3) Earnings per share before amortisation of excess value NOK 1.76 (1.20) Earnings per share NOK 1.42 (0.80) Business activities in the third quarter of 2013 (same period in 2012 in brackets) Key figures for the group Oslo Børs VPS Holding reports a profit of NOK 61 million for the third quarter of 2013 (NOK 35 million). Operating revenues Operating expenses EBITDA Operating profit (EBIT) Earnings for the period Earnings per share (NOK) 1,42 0,80 3,65 3,20 4,51 Earnings per share (NOK) before amorisations 1,76 1,20 4,66 4,37 6,17 The equities and derivatives markets in the third quarter were characterised by a lower level of activity than in the third quarter of Oslo Børs VPS continues to experience more intense competition and pressure on its market share in relation to trading in equity capital instruments. In common with the rest of Europe, the third quarter saw lower volumes in the equities and derivatives markets. The market for new listings of shares so far this year has showed an improvement from The fixed income market (bonds and certificates) continues to show growth. Revenue reported for the third quarter of 2013 was NOK 26 million or 14% higher than in the third quarter of Revenue related to trading, clearing and settlement showed an increase of NOK 11 million. Revenue related to trading reported by Burgundy AB and Fish Pool ASA amounted to NOK 19 million in the third quarter. Evolution, which was purchased in early July 2013, reported revenue of NOK 3 million for the period. Listing and registration-related revenue increased by NOK 6 million. Operating expenses before capitalisation of internal costs, depreciation and amortisation of excess value amounted to NOK 106 million in the third quarter, a decrease of NOK 5 million or 4% from the same period in In the third quarter 2012, the group incurred non-recurring expenses of NOK 2 million in relation to Millennium Exchange. In the third quarter of 2013, the group incurred non-recurring costs of NOK 1 million in relation to cost saving measures. Burgundy, Fish Pool and Evolution reported operating expenses of NOK 5 million for the third quarter. After adjusting for this, operating expenses for the third quarter of 2013 were NOK 6 million or 5% lower than in the same period in Amortisation of excess value was NOK 3 million lower in the third quarter relative to the same period in Excess value in respect of certain systems was fully amortised by the close of Net financial income for the third quarter was NOK 1 million lower than in the equivalent period in This was the result of lower interest rates than in

3 Oslo Børs takes over NIBOR fixing Finance Norway and Oslo Børs have entered into an agreement whereby Oslo Børs takes responsibility for the calculation of the Norwegian Interbank Offered Rate, NIBOR. Oslo Børs will also undertake the supervision of the reporting of interest rates by the banks that constitute the base for the calculation of the interbank rate. Through this new scheme, Oslo Børs will provide a recognised and neutral framework for determining NIBOR. Oslo Børs plans to go live with NIBOR calculation on 9 December. NIBOR rates will be distributed in the same way as other quotes and index information from Oslo Børs, and will be available to the public free of charge on the Oslo Børs website with a 15-minute delay. For market participants who require NIBOR in real-time, the rates will be distributed in the same way as other real-time information from Oslo Børs. Current Oslo Børs opening hours for trading in equities to be continued Outlook for 2013 After having analyzed the possible impact of reduced trading hours over the past twelve months, Oslo Børs has chosen to continue with the current opening hours for trading in equities. This means that the trading day for equities concludes with the closing auction at 16:25. In arriving at this decision, Oslo Børs has both assessed the quality of the order book and consulted with a number of the investment firms that are active in the market. Oslo Børs will review the opening hours on a regular basis, and if it decides to make any changes it will inform all market participants well in advance. The group s operating revenue varies in line with the level of activity in the securities market. Oslo Børs VPS is committed to offering a range of products and a pricing structure that are competitive and that encourage active use of the group's services. Oslo Børs VPS anticipates that its marketplace activities will continue to face intense competition, and it also expects increasing competition for the group s post-trade activities. Oslo Børs VPS will also in the future consider adjusting certain of its fees and prices, as well as further measures to improve the efficiency of its organisation and services for the benefit of its customers. Before allowing for the consolidation of Burgundy AB, Fish Pool ASA and Evolution, operating expenses for 2013 before capitalisation of internal costs, depreciation and amortisation of excess value are expected to be in the order of NOK million. Comparable expenses in 2012 were NOK 469 million (after adjusting for non-recurring items). It is anticipated that ordinary operating revenue and operating expenses for Burgundy and Fish Pool will be a little under NOK 70 million and a little under NOK 40 million respectively in Operating revenue in 2014 is expected to be in the order of NOK million. Operating expenses are expected to be in the order of NOK 15 million. 3

4 Oslo Børs Oslo Børs Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) Revenue reported for the third quarter of 2013 amounted to NOK 108 million, up from NOK 90 million in the third quarter of Revenue reported by Burgundy and Fish Pool ASA amounted to NOK 19 million in the third quarter. Revenue related to trading in shares and derivatives listed on Oslo Børs and Oslo Axess was NOK 9 million lower than in the same period of 2012, while revenue from the primary market and other revenue increased by NOK 9 million in total. The OBX Index was at the close of the third quarter, down by 6.6% in the quarter. Two new companies were admitted to listing on the Oslo Børs and Oslo Axess marketplaces in the third quarter. Eight companies were removed from listing. At the end of the third quarter, 217 companies were listed in total, of which 32 were listed on Oslo Axess. In total 1,523 fixed income issues were listed on Oslo Børs and on Nordic ABM (Alternative Bond Market) at the end of the third quarter, representing an increase of 227 from the same quarter of Listing fees paid by issuers in the third quarter totalled NOK 22 million, up by 8% or NOK 2 million from the same period in Revenue from document inspection and admission to listing fees in the third quarter of 2013 totalled NOK 8 million, up by NOK 5 million. The value of shares, ETFs and equity certificates traded in the third quarter was NOK 193 billion (NOK 204 billion), a decrease of 5% from the third quarter of Statistics published by Thomson Reuters show that Oslo Børs market share of ordinary order book trading in OBX fell from x% in September 2012 to x% in September Oslo Børs had 61 active member firms at the end of the third quarter, of which 19 are local members and 42 are remote members. Fish Pool reported contract turnover for the third quarter totalling 17,396 tonnes. This represents an increase of 118% from the same period in The overall level of activity in the Oslo Børs derivatives market in the third quarter, as measured by the number of contracts traded, was around 1% lower than in same period in Total revenue related to trading in the third quarter was NOK 43 million, an increase from NOK 33 million in the same period in Revenue from Burgundy and Fish Pool is reported as part of revenue related to trading. The estimated number of end users of market data from Oslo Børs at the end of the third quarter was around 28% lower than at the end of the third quarter of The number of professional users fell by 6%, while subscriptions by private individuals fell by 46%. Revenue for the third quarter of 2013 was in line with the equivalent period in Revenue reported for the third quarter of 2013 includes a revenue-increasing non-recurring item of NOK 2.4 million. Personnel expenses and other operating expenses for the third quarter of 2013 were NOK 2 million lower than in the same period in In the third quarter of 2012, Oslo Børs incurred non-recurring expenses of NOK 2 million in relation to Millennium Exchange. In the third quarter of 2013, Oslo Børs incurred non-recurring costs of NOK 2 million in relation to cost saving measures. Burgundy and Fish Pool reported operating expenses of NOK 4 million for the third quarter. After adjusting for these expenses, personnel and other operating expenses for the third quarter of 2013 were in line with the same period in Equities - value of turnover(nok bn) Market data - number of end users Q411 Q112 Q212 Q312 Q412 Q113 Q213 Q Q411 Q112 Q212 Q312 Q412 Q113 Q213 Q313 4

5 VPS VPS Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) Third quarter 2013 operating revenue for VPS totalled NOK 99 million (NOK 92 million), representing an increase of NOK 7 million or 8% from the same quarter in The number of securities registered in the issuer area saw an increase in fixed income issues registered with VPS, but a reduction in the number of limited companies registered relative to the third quarter of At the end of the third quarter, 1,139 (1,248) limited companies and 2,216 (2,010) fixed income issues were registered with VPS. Revenue from the issuer area for the third quarter of 2013 increased by NOK 3 million or 10% to NOK 28 million. The market value of VPS-registered mutual funds at the end of the third quarter was NOK 415 billion (NOK 333 billion), representing an increase of 25% from the end of the third quarter of The number of mutual fund transactions totalled 1.2 million in the third quarter, down by 3% from the same quarter of Revenue from the mutual funds area for the third quarter was NOK 1 million higher than in the third quarter of Evolution is included in the VPS Fund Services reporting unit. Evolution reported revenue for the third quarter 2013 of NOK 3 million. The number of transactions in the settlements area in the third quarter of 2013 was 3% higher than in the third quarter of Revenue from the settlements area in the third quarter was NOK 1 million or 3% higher than in the same period in In the investor area, the market value of holdings was 8% higher at the end of the third quarter of 2013 than at the same time in There were 1.5 million VPS accounts at the end of the third quarter of 2013, a reduction of 9% from the end of the third quarter of Third quarter revenue for the investor area was NOK 1 million or 4% higher than in the same quarter in Personnel expenses and other operating expenses for the third quarter of 2013 were NOK 1 million lower than in the same period in Costs of NOK 1 million were incurred in the period in connection with evaluating the replacement of core systems. Evolution reported operating expenses of NOK 2 million. After adjusting for this, operating expenses for the third quarter of 2013 were NOK 4 million lower than in the same period in Amortisation of excess value was NOK 2 million lower than in the third quarter of This was because excess value in respect of certain systems was fully amortised by the close of Number of trade transactions processed in VPS (1,000) Number of VPS accounts and owners of financial instruments in VPS Q411 Q112 Q212 Q312 Q412 Q113 Q213 Q Q411 Q112 Q212 Q312 Q412 Q113 Q213 Q Transaksjoner (1000) VPS-konti (1000) Eiere (1000) 5

6 Oslo Clearing Oslo Clearing Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) Operating revenue for the third quarter of 2013 was NOK 1 million higher than for the same period in Revenue generated from clearing of equity instruments amounted to NOK 9 million, in line with the third quarter of Revenue generated from central counterparty clearing of derivatives instruments amounted to NOK 2 million, slightly down from NOK 3 million in the third quarter of Revenue generated from the management of cash collateral provided by members and other revenue amounted to NOK 2 million in the third quarter. Personnel expenses and other operating expenses for the third quarter of 2013 were NOK 1 million lower than in the third quarter of Oslo Børs VPS Holding has agreed to sell 100% of Oslo Clearing to Swiss SIX group. The acquisition is subject to approval by the authorities and other conditions, and is therefore expected to close in the second quarter of Finanstilsynet (the Financial Supervisory Authority of Norway) notified SIX in June 2013 that it has no objection to SIX being the owner of Oslo Clearing. Equity market - value of turnover and number of transactions Q411 Q112 Q212 Q312 Q412 Q113 Q213 Q Derivatives - number of standardised contracts and value of turnover Q411 Q112 Q212 Q312 Q412 Q113 Q213 Q Verdi (Nok mrd) Trans (1000) Kontrakter (1000) Omsetning (MNOK) 6

7 Oslo Market Solutions Oslo Market Solutions Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) Operating revenue for the third quarter of 2013 was NOK 0.5 million lower than in the third quarter of Oslo Market Solutions operating revenue fluctuates with the timing of the implementation of customer projects and annual system licences. Personnel expenses and other operating expenses were NOK 0.3 million lower than in the third quarter of Please see for further operational key figures. All figures are in thousands of Norwegian kroner and apply to the Oslo Børs VPS group unless otherwise stated. The group comprises the parent company Oslo Børs VPS Holding ASA and the subsidiaries Oslo Børs ASA, Verdipapirsentralen ASA (VPS), Oslo Clearing ASA and Oslo Market Solutions AS. The accounting information in this report has not been audited. 7

8 Profit and loss account The interim report has been prepared in accordance with IAS 34. The same accounting principles and methods of calculation are used in the interim report as in the annual accounts. Earnings per share is calculated on the basis of earnings for the period in question. Operating revenues Operating expenses Capitalisation of internal resources Salary and other personnel expenses Other operating expenses Depreciations and write-downs Amortisations Operating expenses before capitalisation of internal resources, depreciations and amortisations Total operating expenses EBITDA Operating profit (EBIT) Net financial items Ordinary pre-tax profit Tax Earnings for the period Actuarial gains/losses defined benefit pension plans Tax-effect Total comprehensive income Profit/loss attributable to non-controlling interests Profit/loss attributable to owners of the parent Earnings per share (NOK) 1,42 0,80 3,65 3,20 4,51 Diluted earnings per share (NOK) 1,42 0,80 3,65 3,20 4,51 Earnings per share (NOK) before amorisations 1,76 1,20 4,66 4,37 6,17 EBITDA= Operating revenues - Salary and other personnel expenses - Other operating expenses 8

9 Segment information The Oslo Børs VPS Holding group has four segments: Oslo Børs, VPS, Oslo Clearing, and Oslo Market Solutions. The segments are equivalent to the subsidiaries of the same name. The segment information reported has been prepared in accordance with IFRS 8. Oslo Børs Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) VPS Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) Oslo Clearing Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) Oslo Market Solutions Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) Other/eliminations Operating revenues Salary and other operating expenses EBITDA Capitalisation of internal resources Depreciations and write-downs Amortisations Operating profit (EBIT) Total operating revenues Total salary and other operating expenses Total EBITDA Total capitalisation of internal resources Total depreciations and write-downs Total amortisations Total operating profit (EBIT)

10 Balance sheet Short-term receivables totalled approximately NOK 105 million at the end of the third quarter of Of this, trade receivables totalled NOK 66 million. Other current receivables, including prepaid expenses and income accrued but not yet invoiced, amounted to NOK 39 million. The market value of outstanding derivative positions totalled NOK 442 million. Oslo Clearing is the formal counterparty in derivative transactions traded on Oslo Børs and in derivative or securities lending transactions notified for clearing. Counterparty risk is measured by models designed in accordance with international practice. Counterparty exposure is covered by individual collateral from each customer. IFRS 39 and IAS 32 stipulate that a clearing entity must recognise the liabilities it incurs as a central counterparty to derivative contracts. The market value of positions is recognized in the balance sheet as a current liability, with a balancing entry in current assets. Receivables and liabilities that can be assigned to outstanding derivative positions are netted to the extent that set-off can be applied. Oslo Clearing is also the formal counterparty in transactions in equities, equity certificates and ETFs traded on Oslo Børs. The amounts that Oslo Clearing undertakes to pay or receive as a counterparty in the event that the financial instruments in question are not transferred on the settlement date are included in its balance sheet with liquidity effect with an offsetting entry in the form of a current liability or receivable due as appropriate. Member firms are required to provide collateral in favour of Oslo Clearing in order to participate in settlement. Following the changes made by Oslo Clearing to its clearing model in September 2012, members can provide such collateral by way of financial instruments or liquid assets. Liquid assets are transferred to Oslo Clearing. At the close of the third quarter of 2013, these liquid assets amounted to NOK 1,057 million. Oslo Clearing manages these liquid assets in accordance with a set investment policy. These amounts are included on the asset side of Oslo Clearing's balance sheet as part of bank deposits and financial fixed assets, with an offsetting liability entry as Cash collateral from members. Cash and cash equivalents totalled NOK 1,438 million at the end of the third quarter. Current liabilities amounted to approximately NOK 209 million at the end of the third quarter, of which tax payable accounted for NOK 66 million, and prepayments from customers accounted for NOK 44 million. Fixed assets 30. Sept 30. Sept IT systems Customer relations Registrations Goodwill Deferred tax assets Tangible assets Treasury bills and bonds Financial fixed assets Current assets Market value of outstanding derivatives positions Receivables Treasury bills and bonds Cash and liquid assets Assets Equity Contributed equity Earned equity Non-controlling interests 933 Total equity Liabilities Pension liabilities Deferred tax liabilities Cash collateral Market value of outstanding derivatives positions Current liabilities Equity and liabilities

11 Cash flow Cash flow is reported in accordance with IAS 7. At the end of the third quarter, the group held Treasury bills and bonds, together with bank deposits, totalling NOK 1,792 million. Cash collateral received from member firms amounted to NOK 1,057 million at the end of the third quarter. The receipt of collateral from members of Oslo Clearing is, since 2012, classified as part of investment activities. The group's financial income is included in investment activities, and its financial expenses are included in financing activities. Oslo Børs VPS Holding recorded an increase in cash and cash equivalents of NOK 141 million in the third quarter. Cash flow from investment activities was affected by an increase in holdings of Treasury bills and bonds totalling NOK 21 million, while cash collateral from members increased by NOK 171 million. Cash and cash equivalents held at the end of the quarter totalled NOK 1,438 million. 3rd Quarter 3rd Quarter 3rd Quarter 3rd Quarter Cash flow from - operational activities investment activities investments in systems and tangible assets investments in subsidiaries investments in treasury bills and bonds received cash collateral from members financial income financing activities Cash and cash equivalents at period's start Change in cash and cash equivalents Cash and cash equivalents at period's end Cash flow per share (NOK) 3,29 15,04 3,13 12,21 9,55 Treasury bills, bonds and bank deposits Cash collateral from members Net after deduction for cash collateral from members Equity Equity amounted to NOK 1,308 million at the end of the third quarter, and the equity ratio was 41%. Equity at period's start Total comprehensive income Dividends Purchase of own shares -295 Acturial gains/losses in the period Change in non-controlling interests etc Equity at period's end Equity ratio 41 % 57 % 41 % 57 % 52 % 11

12 Shareholder information Oslo Børs VPS Holding ASA share price: The graph shows movements in the share price of Oslo Børs VPS Holding ASA over the last three years. The company has issued 43,004,000 shares. Approximately 4.3 million shares were traded in the third quarter of 2013, with prices from NOK 50 to NOK 54. The last registered trade in the quarter was at NOK 52. Oslo Børs VPS Holding ASA 20 largest shareholders at 21 October

13 Key figures Financial Earnings per share (NOK) 1,42 0,80 3,65 3,20 4,51 Diluted earnings per share (NOK) 1,42 0,80 3,65 3,20 4,51 Change in cash per share (NOK) 3,29 15,04 3,13 12,21 9,55 Return on equity 19,1 % 9,2 % 14,9 % 12,1 % 13,3 % Return on total capital 11,1 % 7,1 % 9,5 % 9,5 % 9,7 % Net operating margin 36,6 % 22,5 % 26,9 % 27,6 % 29,7 % Operational OBX index at period's end 459,57 415,42 459,57 415,42 410,30 Change in period 6,6 % 10,6 % 12,0 % 16,2 % 14,7 % Equities - no. of transactions (1000s) Equities - value of turnover (NOKbn) Equities - market value listed companies (NOKbn) No. of companies listed Change in period Number of trade transactions processed in VPS (1000s) Number of VPS-accounts (1000s) Derivatives - no. of contracts traded (1000s) Turnover derivatives (NOK million) Financial market data - number of end-users Resultat pr. aksje: Kontantstrøm pr. aksje: Egenkapitalrentabilitet Totalkapitalrentabilitet Netto driftsmargin Periodens resultat/gjennomsnittlig antall aksjer Netto endring i kontanter og kontantekvivalenter/gjennomsnittlig antall aksjer Periodens resultat (annualisert)/gjennomsnitt av bokført egenkapital gjennom året målt på månedlig basis Resultat før skatt (annualisert)/gjennomsnitt av sum eiendeler gjennom året målt på månedlig basis Driftsresultat/driftsinntekter The Board of Directors of Oslo Børs VPS Holding ASA Oslo, 23 October

14 OSLO BØRS VPS ASA PO Box 460 Sentrum 0105 Oslo Telephone: