Singapore Exchange Ltd. · SGX:S68
Singapore Exchange — H1 FY2024 Earnings Presentation
23 slides from Singapore Exchange's earnings presentation, Feb 1, 2024
Slide 1: 1H FY2024 Results Analyst and Media Briefing
1H FY2024 Results Analyst and Media Briefing Loh Boon Chye, Chief Executive Officer Ng Yao Loong, Chief Financial Officer 1 February 2024 Singapore Exchange Commodities | Equity Derivatives | Fixed Income | FX | Indices | Securities
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation may contain forward-looking statements that involve assumptions, risks and uncertainties. Statements in this presentation that are not historical facts are statements of future expectations with respect to the financial conditions, results of operations a
Slide 3: Agenda
Agenda 1 1H FY2024 – Financial Highlights and Performance 2 Business Update 3 Questions and Answers 3
Slide 4: 1H FY2024 Financial Highlights and Performance
1H FY2024 Financial Highlights and Performance Ng Yao Loong, Chief Financial Officer 4
Slide 5: 1H FY2024 Highlights
1H FY2024 Highlights Resilience amidst a challenging macroeconomic environment Group Revenue & Expenses Group NPAT1 Group Margins (%) 3.6% 3.0% 1.0% 6.2% 0.3% pts 1.0% pts 571 592 49.7 50.0 41.4 42.4 287 296 285 282 237 251 2 Revenue Expenses Reported Adjusted Op. Profit Margin Adj. NPAT Margin 1H F
Slide 6: Volume growth driven by commodities, FX derivatives and OTC FX
Volume growth driven by commodities, FX derivatives and OTC FX ▪ Increased portfolio risk management activities in commodities and currencies ▪ Broader Equities business faced challenges Derivatives1 (+$16M) Cash Equities (-$10M) OTC FX (+$5M) DAV (‘000) SDAV (S$’B) OTC FX ADV (US$’B) 1,023 1,038 1.
Slide 7: Revenue Reclassification - 1H FY23 Revenue
Revenue Reclassification - 1H FY23 Revenue1 ▪ Four operating segments to better reflect the nature of revenue Previous Classification FICC (27%) Equities (60%) Data, Connectivity & Indices (13%) (1H FY23) Fixed Income Equities - Cash Market Data and Indices Currencies & Commodities Equities - Deriva
Slide 8: 1H FY2024 Revenue up 3.6% to $592M
1H FY2024 Revenue up 3.6% to $592M ▪ FICC revenue up 28.1% from strong growth in Currencies & Commodities ▪ Pro forma1 average fee per contract remained comparable at $1.54 +33 -10 -12 +9 ▪ On-exchange currency ▪ Total traded ▪ Equity derivatives ▪ Market Data and volumes up 24% to value declined vo
Slide 9: 1H FY2024 Total Expenses up 3.0% to $296M
1H FY2024 Total Expenses up 3.0% to $296M ▪ FY2024 expense growth expected to be similar to 1H FY2024 expense growth ▪ FY2024 CAPEX expected to be between $70 - 75M, lower than previous guidance of between $75 - 80M +13 +2 -4 -6 -3 ▪ Merit ▪ Higher system ▪ Absence of ▪ Lower professional ▪ Amortisa
Slide 10: NPAT includes non-cash adjustments from investments
NPAT includes non-cash adjustments from investments Non-cash adjustments -35 -4 +5 +3 282 251 2 1 1 Mainly from investment in a private equity fund managed by 7RIDGE, that acquired global trading software provider Trading Technologies. 2 Others include amortisation of purchased intangible assets and
Slide 11: Strong balance sheet with healthy leverage ratio
Strong balance sheet with healthy leverage ratio ▪ Moody’s reaffirmed our Aa2 rating in November 2023, and maintained a stable rating outlook ▪ EUR240M of existing debt is due for refinancing in March 2024 Gross Debt (S$’M)1 Debt Maturity (S$’M) Gross Debt to EBITDA1,3 721 712 3502 3302 1.1x 1.0x 1H
Slide 12: Delivering shareholder returns
Delivering shareholder returns ▪ Quarterly dividend of 8.5 cents per share, bringing total dividend for 1H FY2024 to 17.0 cents Adjusted EPS1 (cents) Dividend per share (cents) 6.2% 6.3% 23.5 22.2 17.0 16.0 1H FY2023 1H FY2024 1H FY2023 1H FY2024 1 Adjusted figures presented are non-SFRS(I) measures
Slide 13: Business Update
Business Update Loh Boon Chye, Chief Executive Officer 13
Slide 14: Navigating a challenging global macroenvironment
Navigating a challenging global macroenvironment Simplifying access to Asia for our international customers remains key ▪ Structurally higher interest rate environment ▪ Geopolitical risks and uncertainties SGX Group ▪ China and India: Projected to be the top 3 offers efficient largest economies by
Slide 15: SGX FX: A growing contributor to our bottom line
SGX FX: A growing contributor to our bottom line OTC FX ADV has consistently reached US$100 billion in recent months 24% growth in FX Futures volume 46% increase in OTC FX ADV ▪ World’s most liquid Asian FX futures ▪ One of the leading exchange-backed exchange OTC platforms ▪ Predominant venue for t
Slide 16: Commodities remain a strong growth pillar
Commodities remain a strong growth pillar Iron ore and freight increasingly important as an Asia proxy 48% growth in Commodities volume Iron Ore FFA ▪ Acceleration of financialisation ▪ The ultimate destination for dry FFA ▪ Increase in T+1 volumes trading and clearing 60% 49% Screen Trading 28% 31%
Slide 17: Equity derivatives remain resilient amid headwinds
Equity derivatives remain resilient amid headwinds Flagship contracts remain most liquid and actively-traded internationally Leading Position in Strong start to NSE IX-SGX SGX FTSE China A50 Index futures GIFT Connect Open interest continues to grow 16% to >930K Open interest >240K contracts, up 7%
Slide 18: Expanding our securities product suite and network
Expanding our securities product suite and network 1st in Asia to Enlarged and Singapore-China Thailand- launch Listed broadened ETF ETF Product Singapore DR Structured Certs shelf Links Linkage ▪ Discount and ▪ Landmark climate ▪ Launched 1st pair of ▪ Healthy pipeline of DRs Autocallable action ET
Slide 19: Our Outlook
Our Outlook Expand multi-asset offerings and drive growth of emerging products Strengthen global distribution capabilities Positioning our Index business Foster deeper relationships with partners FY2024 expense growth guidance at 3%; Lower FY2024 CAPEX guidance to $70-$75M Maintain mid-single digit
Slide 20: Questions and Answers
Questions and Answers Loh Boon Chye, Chief Executive Officer Michael Syn, President, Head of Global Markets Division Ng Yao Loong, Chief Financial Officer Lee Beng Hong, Head of Wholesale Markets & Platforms Pol De Win, Head of Global Sales & Origination 20
Slide 21: Appendix
Appendix =SGXGroup
Slide 22: Restatement for 1H FY2023
Restatement for 1H FY20231 Previous Classification New Classification Previous Classification $’000 1HFY23 $’000 1HFY23 Fixed Income, Currencies and Commodities Fixed Income, Currencies and Fixed Income Commodities 13% Listing 2,570 Fixed Income Corporate actions and other 1,694 27% Listing 2,570 4,
Slide 23: Thank you
Thank you Singapore Exchange Commodities | Equity Derivatives | Fixed Income | FX | Indices | Securities sgx.com This material is not intended for distribution to, or for use by or to be acted on by any person or entity located in any jurisdiction where such distribution, use or action would be cont