NZX Limited · NZX:NZX
NZX — FY2024 Earnings Presentation
44 slides from NZX's earnings presentation, Feb 21, 2025
Slide 1: NZX Full Year 2024 Results Investor Presentation
NZX FULL YEAR 2024 RESULTS INVESTOR PRESENTATION 21 February 2025 1
Slide 2: Contents and Important Notice
Contents Executive Summary Page 3 Important notice This investor presentation should be read in conjunction with NZX's other periodic and continuous disclosure announcements, and the financial statements in the 2024 Annual Report, which provides additional information on many areas covered in this p
Slide 3: Executive Summary
Executive Summary Mark Peterson Chief Executive Officer 3
Slide 4: FY24 Results – Financial Highlights
FY24 Results – Financial Highlights NZX has produced a strong operating financial result in a mixed year for global markets. Demonstrating all-round business strength through diversity of product offering – as a market operator, fund manager and fund administration platform provider Operating Earnin
Slide 5: FY24 Results – 2024 strategic delivery achievements
FY24 Results – 2024 strategic delivery achievements NZX is delivering to our growth strategy, and we are seeing positive momentum in the key revenue driving metrics 2024 Targets 2024 Actual 5 Yr Progress Strategic Delivery Markets Group • Capital listed and raised $15.0 billion $15.8 billion $17.7bn
Slide 6: 2025 strategic delivery - what success looks like
2025 strategic delivery - what success looks like The 2025 strategic priorities and targets for the key revenue metrics drive the 2025 earnings guidance 2025 Strategic Priorities External dependencies 2025 Targets Markets • Capital listed and raised • Ensure NZX positioned for growth when macro-econ
Slide 7: NZX's Strategy
NZX’s Strategy We operate under a strategic framework with interconnected businesses driving scale and operating leverage for shareholders and helping New Zealand grow • Assist NZ to grow and improve its productivity Growing, Connecting, Creating Value • Three connected and complimentary STRATEGY bu
Slide 8: Business Unit Highlights
Business Unit Highlights "New Zealand's Exchange Te Paehoko O Aotearoa
Slide 9: Capital Markets Origination – Capital Listed and Raised
Capital Markets Origination – Capital Listed and Raised Capital listed increased reflecting a general improvement in the macroeconomic environment, this is driven by i) retail / sustainable debt, and ii) specific large capital raises for acquisitions / positioning for further growth Market Activity
Slide 10: Secondary Markets – Value Traded / Cleared
Secondary Markets – Value Traded / Cleared Value traded / cleared increased reflecting a general improvement in the macroeconomic environment in H2-24 Market Activity Value Traded / Cleared $41.5 billion • Movement from 2023 / 5 year rolling average +22.9% / (5.1)% • Depository: • Assets under custo
Slide 11: Information Services Revenue
Information Services Revenue Lower professional terminals and subscriptions lag the general improvement in the macroeconomic environment High level of back dated indices revenue and increased higher value licences Market Activity Information Services revenue (including audit / backdated revenue) $19
Slide 12: Dairy Derivatives and GlobalDairyTrade
Dairy Derivatives and GlobalDairyTrade Dairy Derivatives lots traded continue to see the significant growth expected from the Singapore Exchange strategic partnership though margin fee rates have started to normalise from the prior year peak levels GlobalDairyTrade is underway with its strategic gro
Slide 13: Smart – Funds Under Management (FUM)
Smart – Funds Under Management (FUM) Continues to drive growth Smart’s future growth opportunities remain strong through organic growth We continue to mature the operational environment to improve operating leverage Fund Activity in 2024 • Craigs Investment Partners – the first new funds under the P
Slide 14: Wealth Technologies – ARR and Funds Under Admin
Wealth Technologies – Annual Recurring Revenue (ARR) and Funds Under Admin (FUA) Client transitions continue, with successful pipeline conversions and the positive outlook continues External client activities were cash flow positive for the December 2024 month Client Activity in 2024 External Client
Slide 15: Financial Performance
Financial Performance New Zealand's Exchange Te Paehoko O Aotearoa
Slide 16: Income Statement
Income Statement 2024 2023 Change Operating Earnings $000 $ 000 Fav/(Adv) Operating Revenue 120,756 108,387 11.4% Operating earnings (ex. one-off integration and restructure costs) of $48.5 million was up 21.0% Operating Expenses (excl. acq/int/restructure costs) (72,229) (68,278) (5.8)% Operating E
Slide 17: Income Statement – Operating Revenue
Income Statement – Operating Revenue (+$12.4m / +11.4%) Increased revenue driven by strong growth in both Smart and Wealth Technologies, with some recovery in Markets revenues Markets Markets revenue increased $2.0 million / 3.3% driven by: • Capital Markets Origination revenue – increased 6.1%, ref
Slide 18: Income Statement – Operating Expenses
Income Statement – Operating Expenses (+$4.0m / +5.8%) Strong cost control across NZX, with increased expenses driven by integration of Smart acquisitions Markets Markets expenses increased $0.1 million / 0.5% driven by: • Personnel costs – decreased 4.4% on 2023, driven by lower average number of F
Slide 19: Income Statement – Operating Earnings Segmental Analysis
Income Statement – Operating Earnings Segmental Analysis 2024 Capital Secondary Information Markets Funds Wealth Corporate NZX Commercial Regulation NZX Group $000 Markets Markets Services Sub-total Management Technologies Services Operations (NZ RegCo) Total Origination (Smart) Sub-total Operating
Slide 20: Income Statement – Non Operating Expenses
Income Statement – Non Operating Expenses Amortisation will continue to grow in line with Wealth Technologies new client migration / CAPEX profile; resulting in future cash flows initially rising faster than future NPAT increases (due to the Wealth Technologies’ ‘amortisation bubble’ - refer to slid
Slide 21: Financial Position and Cash Flows
Financial Position and Cash Flows 21
Slide 22: Balance Sheet as at 31 December 2024
Balance Sheet as at 31 December 2024 Most cash balances (i.e. risk capital and regulatory working capital) are not available for general use 2024 2023 Cash and cash equivalents Includes: $000 $000 Current assets • Clearing House risk capital ($20 million) which is not available for general use; Cash
Slide 23: CAPEX
CAPEX CAPEX mainly relates to Wealth Technologies’ new client migration activity, which is expected to remain high whilst there is new client migration activity and Wealth Technologies enhances the Smart operating systems (i.e. client portal and registry) Trading, Clearing and Energy Systems CAPEX •
Slide 24: Cash Flows
Cash Flows Increased cash flows driven by operating earnings. In future years, cash flows are expected to rise faster than NPAT increases due to the Wealth Technologies’ ‘amortisation bubble’ (refer to slide 37) 2024 2023 Operating Activities $000 $000 Operating activities 35,887 34,439 Operating ac
Slide 25: Final Dividend and 2025 Earnings Guidance
Final Dividend and 2025 Earnings Guidance 25
Slide 26: Final Dividend and 2025 Earnings Guidance
Final Dividend 2025 Earnings Guidance Final Dividend 2025 Earnings Guidance • The Board has declared a fully imputed final dividend of 3.1 cents per share NZX’s full year 2025 Operating Earnings (EBITDA), excluding integration costs, is forecast to be in • Dividend to be paid on 2 April 2025 to shar
Slide 27: Appendices
Appendices New Zealand's Exchange Te Paehoko O Aotearoa
Slide 28: Appendix 1: Segmental Analysis Income Statement by Business Unit
Appendix 1: Segmental Analysis Income Statement by Business Unit 2024 Capital Secondary Information Markets 1 Funds Wealth Corporate NZX Commercial Regulation NZX Group 1 1 3 4 5 $000 Markets Markets Services Sub-total Management Technologies Services Operations (NZ RegCo) Total 1 2 Origination (Sma
Slide 29: Appendix 1: Segment – Markets
Appendix 1: Segment – Markets Markets is the integrated business that supports the growth of NZ capital markets 2024 2023 Change 2024 2023 Change $000 $000 Fav/(Adv) $000 $000 Fav/(Adv) Revenue Expenses Capital Markets Origination Gross personnel costs 12,047 12,195 1.2% Annual Listing Fee (net) 10,
Slide 30: Appendix 1: Segment – Markets Operating Revenue
Appendix 1: Segment – Markets Operating Revenue Markets Operating Revenue Secondary Markets Revenue (continued) Markets operating revenue was $62.9 million (increase of 3.3% on 2023) driven by: Dairy derivatives revenue has been adversely impacted by margin fees normalising in line with global futur
Slide 31: Appendix 1: Segment – Markets Operating Expenses
Appendix 1: Segment – Markets Operating Expenses Markets Operating Expenses Professional Fees Markets operating expenses were $20.1 million for 2024 (increase of 0.5% on 2023) mainly reflecting: Professional fees cost decreased by (23.7)% and include: • Personnel costs – reduced 4.4% on 2023, driven
Slide 32: Appendix 1: Segment – Smart (formerly Smartshares)
Appendix 1: Segment – Smart (formerly Smartshares) This business is a funds management business which comprises the SuperLife superannuation, QuayStreet funds, KiwiSaver products and Smart Exchange Traded Funds 2024 2023 Change Operating Earnings (excluding acquisition, integration and restructuring
Slide 33: Appendix 1: Segment – Smart (formerly Smartshares)
Appendix 1: Segment – Smart (formerly Smartshares) This business is a funds management business which comprises the SuperLife superannuation, QuayStreet funds, KiwiSaver products and Smart Exchange Traded Funds Operating Revenue Acquisition, integration and restructuring costs FUM-based revenue – ha
Slide 34: Appendix 1: Segment – Wealth Technologies
Appendix 1: Segment – Wealth Technologies This business administers and manages a platform that enables advisers and brokers to manage client investments 2024 2023 Change Operating Revenue $000 $000 Fav/(Adv) 9,212 6,558 40.5% Administration (FUA based) fees – average FUA has increased (2024: $14.14
Slide 35: Appendix 1: Segment – Corporate Services
Appendix 1: Segment – Corporate Services This function provides accommodation, legal, finance, IT, HR, communications and project management support to the business 2024 2023 Change Operating Revenue $000 $000 Fav/(Adv) 102 83 22.9% Revenue relates to the sublease of space in Auckland office, as wel
Slide 36: Appendix 1: Segment – Regulation (NZ RegCo)
Appendix 1: Segment – Regulation (NZ RegCo) Tasked with performing all of NZX’s frontline regulatory functions, resulting in the structural separation of the Group's commercial and regulatory roles 2024 2023 Change Regulation (NZ RegCo) $000 $000 Fav/(Adv) Issuer Regulation services 556 510 9.0% Reg
Slide 37: Appendix 1: Non-Operating Expenses
Appendix 1: Non-Operating Expenses Depreciation and Amortisation Depreciation and amortisation Wealth Technologies – Amortisation Bubble Depreciation and amortisation increased due to the impact of: Wealth Technologies future CAPEX levels are dependent on the number of new client • Wealth Technologi
Slide 38: Appendix 1: Non-Operating Expenses
Appendix 1: Non-Operating Expenses Other Non-Operating Expenses Acquisition, integration & restructure costs Non-Operating Expenses (continued) Acquisition, integration & restructure costs relate to: Share of profit/loss of associate relates to our investment in GlobalDairyTrade (GDT). • Smart – Qua
Slide 39: Appendix 2: People
Appendix 2: People NZX has strong employee engagement, a diverse workforce and a healthy culture across the organisation Work is required to promote and recruit more females into leadership positions Culture and Engagement Diverse Workforce and Gender Pay Gap (GPG) Diverse Workforce and Gender Pay G
Slide 40: Appendix 3: NZX Group overview
Appendix 3: NZX Group overview A diverse and connected capital markets focused business NZX Group Corporate, Legal, Policy, Technology NZ RegCo (Issuer Regulation, Capital Markets Participant Compliance, Smart NZX Wealth Surveillance and Market Cash (Shares), Derivatives, Energy, (Funds Technologies
Slide 41: Appendix 4: Operating Revenue Definitions
Appendix 4: Operating Revenue Definitions Capital Markets Origination Secondary Markets Funds Management (Smart) Annual listing fees paid by NZX’s equity, fund and debt issuers is Participant services revenue is charged to market participants Funds Under Management based revenue relates to variable
Slide 42: Appendix 5: Historical Information
Appendix 5: Historical Information Financial Information 20181 2019 2020 2021 2022 2023 2024 Restated Operating Earnings $28.6m $31.4m $34.4m $35.8m $36.6m $40.1m $48.5m (excluding acquisition, integration and restructuring costs) Net Profit After Tax $13.7m $14.6m $17.6m $15.0m $14.2m $13.6m $25.5m
Slide 43: Contact
Contact Mark Peterson Graham Law Chief Executive Officer Chief Financial Officer mark.peterson@nzx.com graham.law@nzx.com +64 21 390 636 +64 29 494 2223 NZX Full Year 2024 Results 43
Slide 44: Thank you
NZX 7 Thank you