Singapore Exchange Ltd. · SGX:S68
Singapore Exchange — FY2004 Earnings Presentation
26 slides from Singapore Exchange's earnings presentation, Jul 29, 2004
Slide 1: Singapore Exchange Limited FY2004 Full Year Results
Singapore Exchange Limited FY2004 Full Year Results Hsieh Fu Hua, CEO Seck Wai Kwong, CFO Singapore Exchange 29 July 2004
Slide 2: Agenda
Agenda 1. CEO’s Message & Highlights 2. Financial Review 3. Strategy Update 4. Q & A 2
Slide 3: CEO's Message
CEO’s Message Hsieh Fu Hua Chief Executive Officer 3
Slide 4: CEO's Message
CEO’s Message • Building a robust business • Restructuring for efficiency and customer focus • Discipline in cost and capital management • Open connectivity 4
Slide 5: Highlights of FY2004 Full Year Results
Highlights of FY2004 Full Year Results 5
Slide 6: FY 2004 Results
FY 2004 Results Delivering results… Market Change Performance Expectations from FY03 S$115.5 – S$67M(1 Net Profit After Tax S$133.0M S$128.4M ) Cost-to-income 50% – 54% 48.8%(2) 19.5% Return on Equity Mid-teens 20.8% 11.6% Dividend per Share 6.5 – 11.0 7.0 13.5 cents(3) (Gross) cents cents (1) Exclu
Slide 7: Financial Review
Financial Review Full Year Results ended 30 June 2004 Seck Wai Kwong Chief Financial Officer 7
Slide 8: Income Statement
Income Statement Profitability improved … % (in S$MM) FY04 FY03 Change Operating Revenue 316.3 218.5 44.8 Operating Expenses 149.9 166.4 9.9 Securities Operating Profit 166.4 52.1 219.4 trading Net Non-Operating Revenue (0.3) 25.4 NM Derivatives Exceptional item - (50.0) 100.0 trading Net Profit Bef
Slide 9: Operating Revenue
Operating Revenue Strong improvement in operating High securities leverage revenue (in S$MM) 350 300 Record securities 250 Coveragetrading of 184 operating expenses 200 114 165 160 154 150 100 86% - FY 04 Asian 100 50 39 43 Derivatives 70% 74% 86% 74% - FY 03 50 83 76 75 0 70% - Listing FY 02 Fees F
Slide 10: Operating Expenses
Operating Expenses Continued financial discipline Headcount & base salary Declining costs 165 Revision of rental rates 160 154 & expiration of leased 19 20 Miscellaneous premises 10 21 10 24 13 Cost of sales Sub-lease of surplus 22 18 premises 19 21 Depreciation 18 18 17 15 System support se
Slide 11: Performance at a Glance
Performance at a Glance Enhancing shareholder value FY 2004 FY 2003(1) Change 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 6.5 +7.0 (1) Excludes non-recurring & exceptional items, Annual Report
Slide 12: New Dividend Policy
New Dividend Policy Our commitment to shareholders Gross Dividend per Share (in cents) 13.5 Special Raise minimum 6.5 dividend per 7.0 share and maintain payout 7.3 7.0 ≥ 50% NPAT 6.5 FY02 FY03 FY04 12
Slide 13: New Dividend Policy
New Dividend Policy Our commitment to shareholders Net Dividend per Share (in cents) 10.8 Special Up from 5.1 cents 5.2 to 5.6 cents 5.6 5.7 5.6 5.1 FY02 FY03 FY04 13
Slide 14: Comparison of Dividend Yield
Comparison of Dividend Yield SGX – A good dividend play Singapore Listed Companies Various Exchanges 9.0 8.0 7.0 8.0 Dividend Yield (%) 6.0 5.0 4.0 3.0 2.0 1.0 0.0 F&N SPH UOB DBS OCBC SGX HKEx ASX Euronext LSE Deutsche Borse SGX Mainboard Exchange Average Source: Bloomberg, SGX Dividend yield = Gro
Slide 15: Strategy Update
Strategy Update Hsieh Fu Hua Chief Executive Officer 15
Slide 16: Strategic Direction
Strategic Direction Domestic Asian Growth Extend Hub Beyond Exchange linkages Exchange linkages Equity options Asian Derivatives Foreign listings Grow Foreign listings from the Data business Core E-migration Membership Membership Capital management HR Change management In/Out-sourcing Open connectiv
Slide 17: Grow from the core: Securities Market
Grow from the core: Securities Market Building regional growth platform for foreign issuers 75 Breakdown of New Issuers [119, Domestic Foreign 69 21%] 19 62 13 [437, 33 79%] Local vs Foreign Issuers 45 13 Foreign Local 26 [69, 56 22%] 49 7 36 32 19 [249, 78%] FY2000 FY2001 FY2002 FY2003 FY2004 Marke
Slide 18: Grow from the core: Securities Market
Grow from the core: Securities Market Foreign stocks are actively traded on 450% SGX 400% Domestic Stocks 350% Foreign Stocks 300% China 250% 200% 150% 100% 50% 0% Excludes all secondary listings except for Jardine Matheson Group of Companies FY2004 Domestic Stocks Turnover Velocity 63% Foreign Stoc
Slide 19: Our securities market: A growing market
Our securities market A growing market … Average y-o-y growth: 8% 250 208 Trading Value (in S$ Billion) 200 186 160 155 146 150 133 107 109 101 103 100 91 50 - FY FY FY FY FY FY FY FY FY FY FY 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 19
Slide 20: Grow from the core: Derivatives Market
Grow from the core: Derivatives Market Focus on higher margin products Robust Growth in Asian Derivatives 40,000 35,000 30,000 15,241 Contracts (in '000) 25,000 20,674 18,346 20,000 15,000 10,000 8.4% 38.5% 19,716 13,134 14,240 5,000 - FY2002 FY2003 FY2004 Asian Derivatives Others 20
Slide 21: Grow from the core: Derivatives Market
Grow from the core: Derivatives Market Focus on higher margin products 1.4 Leading to Higher Average Clearing Fees per Contract 1.37 Average Derivatives Clearing Fees 1.3 per contract (S$) 1.20 1.2 1.19 1.1 FY2002 FY2003 FY2004 21
Slide 22: Extending Beyond: Strategic Alliances
Extending Beyond: Strategic Alliances NYMEX TSE CME Amex NSE Bursa M’sia SGX ASX 22
Slide 23: Our Investment Story
Our Investment Story • Strong stable revenue base leveraged to market growth • Attractive dividend policy • Discipline in cost & capital management • A superior ROE 23
Slide 24: Comparison of Total Shareholder Return
Comparison of Total Shareholder Return From 1 Jul 2003 to 30 Jun 2004 SGX – A rewarding stock Various Exchanges 100 Singapore Listed Companies 80 60 52 TSR (%) 40 20 0 F&N SPH UOB DBS OCBC SGX HKEx ASX Euronext LSE* Deutsche -20 Borse STI Exchange Average * Includes special dividend payable in Aug 0
Slide 25: Comparison of Total Shareholder Return
Comparison of Total Shareholder Return From 1 Jul 2002 to 30 Jun 2004 SGX – A rewarding stock Various Exchanges 110 Singapore Listed Companies 86 90 70 TSR (%) 50 30 10 -10 F&N SPH UOB DBS OCBC SGX HKEx ASX Euronext LSE* Deutsche Borse STI Exchange Average * Includes special dividend payable in Aug
Slide 26: Q & A
Q&A Panel: 1. Hsieh Fu Hua, CEO 2. Seck Wai Kwong, CFO 26