Slide 1: Interim Results 2016
INTERIM RESULTS 2016 August 2016
Slide 2: Operating environment for H1 2016
Operating environment for H1 2016 Globally, Uncertain start to 2016 for world economy Following lacklustre H2 2015 Equity markets reflect this uncertainty: volatility rising and asset prices falling Signs of improvement in some developed and emerging economies in Q1 But lower trade volumes
Slide 3: Operating environment for H2 2016
Operating environment for H2 2016 Globally, Pace of global economic recovery the key driver for financial markets, particularly Strength of US recovery Rate of slowdown in China Emerging markets could benefit from more positive outlook for US interest rates Follows soft US economic data an
Slide 4: What H1 2016 meant for our stakeholders
What H1 2016 meant for our stakeholders 18% 31% 29% Equity transactions Billable equity value traded Equity value traded 11% 12% 9% Equity derivatives value traded Currency derivatives contracts Commodity derivatives contracts 61% 38% H1 R77m and FY R217m Interest rate Derivatives va
Slide 5: H1 2016 at a glance
H1 2016 at a glance R1.2bn R636m R587m 17% 12% 29% Operating revenue Operating expenses Gross cash flow from operations R567m R513m 17% 19% EBIT NPAT 600 cents 585 cents 19% 19% EPS HEPS 5
Slide 6: Robust financial performance
Robust financial performance Group (Rm) H1 2016 H1 2015 Revenue 1 176 1 008 Other income 27 43 Total revenue 1 203 1 051 Personnel expenses (246) (210) Other expenses (390) (357) Total expenses (636) (567) EBIT 567 484 EBIT % 47% 46% Net finance income 97 79 Share of profit of equity-accounted inves
Slide 7: Growth trend
Growth trend H1 revenue trend H1 expenses trend 12% 7 14% 6 5 4 3 2 1 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Total revenue HEPS EPS Personnel expenses Other expenses Impairments H1 2016 revenue as a % total Primary Markets - 7 % (2015: 8
Slide 8: H1 Operating expenses
H1 Operating expenses Total operating expenses 12% or R69m (2015: 12% or R59m) Personnel costs 17% or R36m (2015: 8% or R16m) R636m Cost-to-company and deferred compensation, which rose by R32 million R567m or about 17%, largely driven by an 8% increase in the average salary per employee as
Slide 9: Cashflow view
Cashflow view 2.500 60 71 522 2.000 543 1.500 (Rm) 1.000 1.908 1.755 500 - Cash Dec 2015 Cash Investing Financing Dividends paid Cash June generated activities activities 2016 from operations Strong balance sheet and no debt 9
Slide 10: Business Review
BUSINES REVIEW JIS
Slide 11: Capital Markets: Primary Market
Capital Markets: Primary Market (R’m) 7% of total revenue in H1 2016 90 Revenue 2% to R76m (H1 2015: R78m) 80 7% 6 new company listings (H1 2015: 9) 70 Other main board listings 2 ETFs, 97 Warrants and 53 Structured Products 60 (H1 2015: 1 ETF, 1 ETN, 157 Warrants and 33 Structured Product
Slide 12: Capital Markets: Equity Market
Capital Markets: Equity Market (R’m) 27% of total revenue in H1 2016 350 Revenue 23% to R289m (H1 2015: R235m) 300 27% Billable value traded 31% Trades 16% (H1 2015: 30m; H1 2014: 250 30m; H1 2013: 21m) Value traded 29% (H1 2016: 3tr; H1 200 2015: 2.4tr; H1 2014: R2.0tr; 2013: R2.1tr
Slide 13: Capital Markets: Bonds and Financial Derivatives
Capital Markets: Bonds and Financial Derivatives (R’m) 12% of total revenue in H1 2016 160 Revenue 9% to R134m (H1 2015: R123m) Equity derivatives revenue 10% to 140 12% R90m. Number of contracts traded 57%; value traded 12% 120 Currency derivatives revenue 22% to R19m. Contracts tra
Slide 14: Capital Markets: Commodity Derivatives
Capital Markets: Commodity Derivatives (R’m) 3% of total revenue in H1 2016 40 Revenue 3% at R35m (H1 2015: R34m) 3% owing to: 35 Contracts traded 9% 30 Value traded 63% Domestic agricultural commodity prices 25 driven by the intense drought conditions which saw a sharp rise in contrac
Slide 15: Trading and Market Services: Back-Office Services
Trading and Market Services: Back-Office Services (BDA) (R’m) 14% of total revenue in H1 2016 160 14% Revenue 1% to R151m (H1 2015: R150m) 140 Linked to Equity Market transactions 120 Net of R39m impact of 20% BDA fee reduction: lower fee per transaction; 100 discontinuation of transaction s
Slide 16: Post-Trade and Information Services: Risk Management
Post-Trade and Information Services: Risk Management (R’m) 19% of total revenue in H1 2016 250 Revenue 28% to R212m (H1 2015: R166m) 29% growth in value traded with 19% revenue-generating value up 30% 200 Reflects only Equity Market clearing fees T+3 project went live on 1 July 2016 Enha
Slide 17: Post-Trade and Information Services: Market Data
Post-Trade and Information Services: Market Data (R’m) 14% of total revenue in H1 2016 160 14% Revenue 32% to R150m (H1 2015: R113m). Of this R37m increase, the biggest 140 drivers are: 120 R23m: forex impact R7m: price increases 100 R2m: organic growth 80 22 new clients: 13 local and 9
Slide 18: Looking Ahead
LOOKING ATEAB
Slide 19: Increased capital expenditure
Increased capital expenditure (external spend only) Project/Initiative H1 2016 H2 2016 FY 2016 FY 2015 T+3 Phase 3 9 1 10 21 Integrated trading and clearing (including new trade functionality) 46 81 127 86 Customer relationship management 6 6 13 10 Bond ETP - 5 5 - Business as usual 16 47 63 42 Tota
Slide 20: H2 2016: challenging, but exciting
H2 2016: challenging, but exciting The focus for 2016 remains on projects that are designed to strengthen the delivery of the JSE’s strategic vision. In particular: Progressing ITaC: first phase, focused on equity derivatives and currencies, is on track for implementation in H2 2017 Having restr
Slide 21: Questions
JS= QUEST ONS
Slide 22: Financial metrics
Financial metrics TO BE REPLACED H1 2016 H1 2015 H1 2014 H1 2013 H1 2012 H1 2011 Operating margin 47% 46% 43% 41% 27% 45% EPS 599.7 503.9 389.4 341.9 117.0 299.0 HEPS 585.1 490.3 391.2 333.2 245.5 288.9 PE 30.9 25.5 24.6 20.8 64.1 21.2 Dividend yield 2.8% 3.7% 4.2% 3.5% 3.3% 3.3% EBITDA 614 535 428