Singapore Exchange Ltd. · SGX:S68
Singapore Exchange — H1 FY2004 Earnings Presentation
22 slides from Singapore Exchange's earnings presentation, Jan 15, 2004
Slide 1: Singapore Exchange Limited FY2004 Interim Results
Singapore Exchange Limited FY2004 Interim Results Hsieh Fu Hua, CEO Seck Wai Kwong, CFO Singapore Exchange 15 January 2004 1
Slide 2: Agenda
Agenda 1. Highlights & Hsieh Fu Hua Strategy Update Chief Executive Officer 2. Market & Financial Seck Wai Kwong Review Chief Financial Officer 3. Conclusion Hsieh Fu Hua Chief Executive Officer 4. Q & A 2
Slide 3: Highlights of FY2004 Interim Results
Highlights of FY2004 Interim Results Hsieh Fu Hua Chief Executive Officer 3
Slide 4: Highlights of 1H FY 2004 Results
Highlights of 1H FY 2004 Results A good first half … 1H % %Change Changefrom from FY2004 1H 1HFY2003 FY2003 Net NetProfit Profitattributable attributableto toShareholders Shareholders S$61.3M S$61.3M 97.6% Operating OperatingRevenue Revenue S$163.5M S$163.5M 52.1% Operating OperatingExpenses Expense
Slide 5: Strategy Update
INGAPORE EXCHANGE Strategy Update SGX. Tomorrow's Market, Today —— —_ TT
Slide 6: Our strategic direction
Our strategic direction At the last results presentation … Solid Regulatory Framework Grow from the Defend the business Going forward core Time Horizon Align economics Product Innovation Strategic alliances • Cost focus • Market data services • CME • Capital management - ROE • New Product Developmen
Slide 7: Update on our strategic direction
Update on our strategic direction Defend the business Progress to date … Infrastructure Development SGX QUEST SGX-MAS Research Scheme Customer Focus Integration of operations OMS Capital Management Cost Control Headcount Data services ASX SGX CME Chinese Credit derivatives Product Strategic listings
Slide 8: Market Review
Market Review Seck Wai Kwong Chief Financial Officer 8
Slide 9: Securities Trading: Strong Performance
Securities Trading: Strong Performance 1H FY 2004 exceeds full year FY 2003 trading activities 160 160 140 140 120 107 120 V a lu e (S $ b n ) V o lu m e (b n ) 100 100 76 71 80 70 150 80 62 55 60 48 60 40 67 40 65 20 45 49 44 46 20 0 0 1H 2H 1H 2H 1H 2H 1H FY2001 FY2001 FY2002 FY2002 FY2003 FY2003
Slide 10: And derivatives trading volume continues to grow
And derivatives trading volume Continues to grow … 20 18 16 14 12 10 (in MM) 17.3 17.6 18.0 8 15.6 12.9 15.1 15.9 6 4 2 0 1H 2H 1H 2H 1H 2H 1H FY2001 FY2001 FY2002 FY2002 FY2003 FY2003 FY2004 10
Slide 11: IPO market: Buoyant primary market activity
IPO market … Buoyant primary market activity 3.0 45 42 40 2.5 N o . o f n ew listin g s 34 35 2.0 1.8 30 24 (S $Bn) 1.4 20 25 1.5 23 2.6 1.1 20 2.3 2.4 1.0 2.1 12 0.7 15 14 1.5 10 0.5 0.2 0.9 0.4 0.2 0.09 5 0.0 0 1H 2H 1H 2H 1H 2H 1H FY2001 FY2001 FY2002 FY2002 FY2003 FY2003 FY2004 Amt of IPO Funds
Slide 12: Financial Review
Financial Review Results for 6 months ended 31 December 2003 12
Slide 13: Income Statement
Income Statement Profitability continues to improve … 1H 1H % (in S$MM) FY04 FY03 Change Operating Revenue 163.5 107.5 52.1 Securities trading Operating Expenses 81.5 78.9 3.2 Derivatives trading Operating Profit 82.0 28.6 187.1 Non-Operating Revenue -1.8 11.7 NM Non-operating Net Profit Before Tax
Slide 14: Operating Revenue
Operating Revenue Securities revenue: Strong improvement 180 160 140 Securities Clearing 120 Fees 98 (in S $ M M ) 100 Account 80 49 51 Maintenance & Processing Fees 60 22 24 21 40 20 37 38 41 Derivatives Clearing Fees 0 1H FY03 2H FY03 1H FY04 Listing & Membership Fees Stable Derivatives Clearing R
Slide 15: Operating Expenses
Operating Expenses Continued discipline in cost management 1H 1H % (in S$MM) 9 Revision of rental rates & FY04 FY03 Change expiration of lease premises Staff Costs 36.3 35.0 3.7 18 9 System support services Occupancy 6.7 7.9 15.1 19 Costs 9 Fully depreciated assets System Maintenance & 9.9 11.0 10.2
Slide 16: Operating Expenses: Effective cost management
Operating Expenses Effective cost management 90 80 Other operating 10 12 14 expenses 70 4 4 Cost of sales 5 60 12 11 10 Depreciation (in S$MM) 50 11 10 10 40 8 9 7 System maintenance & rental 30 Occupancy costs 20 35 35 36 Staff costs 10 0 1H FY2003 2H FY2003 1H FY2004 2H FY2003 excludes (1) provisi
Slide 17: Performance at a Glance
Performance at a Glance From strength to strength 1H 1H 1H 1H FY FY2004 2004 FY FY2003 2003 FY 2003(1) Return Returnon onEquity Equity(2)(2) (Annualised) (Annualised) 20.8% 7.4% 9.2% Cost–to–Income Cost–to–Income 49.8% 73.4% 73.4% 68.3% 68.3% Net NetProfit ProfitMargin Margin 37.9% 26.0% 26.0% 32.6%
Slide 18: Comparison of Dividend Yield
Comparison of Dividend Yield SGX – Still a good dividend play Singapore Listed Companies 4.5 Various Exchanges 4.0 D iv id e n d Y ie ld (% ) 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 F&N SPH UOB DBS OCBC SGX HKEx ASX Euronext LSE Deutsche Borse Dividend Yield as at 14 Jan 04 SGX Mainboard Exchange Average So
Slide 19: Conclusion
Conclusion Hsieh Fu Hua Chief Executive Officer 19
Slide 20: Our Investment Story
Our Investment Story • Strong stable revenue base leveraged to market recovery • Maintain attractive dividend policy • Continued financial discipline in cost management and ROE 20
Slide 21: Comparison of Total Shareholder Return
Comparison of Total Shareholder Return From 1 Jan 2003 to 14 Jan 2004 SGX – A rewarding stock Singapore Listed Companies 100 Various Exchanges 90 81 80 70 T S R (% ) 60 50 40 30 20 10 0 F&N SPH UOB DBS OCBC SGX HKEx ASX Euronext LSE Deutsche Borse TSR STI Exchange Average 21 Source: Bloomberg
Slide 22: Q&A
Q&A Panel: 1. Hsieh Fu Hua, CEO 2. Seck Wai Kwong, CFO 22