Slide 1: JSE H1 2022 Results Presentation
2 August 2022 ©Johannesburg Stock Exchange. The content of this presentation is strictly reserved for the use of the JSE.
Slide 2: Agenda
Key Highlights 03 Financial Review 08 Conclusion 16 Appendix 20 2
Slide 3: Key Highlights
Key Highlights ©Johannesburg Stock Exchange. 3
Slide 4: Strong revenue growth across all segments
Strong revenue growth across all segments R1.4bn R880m Operating Operating Contained cost growth revenue expenses +10% YoY +3% YoY High cash generation Continued growth in JSE Investor Services (JIS) & Information Services 100% 542.7 Successful launch of JSE Private Placements Earnings cash HEPS (cp
Slide 5: Segment revenue performance
+9% Capital markets (R549m) Post-trade services (R453m) +8% YoY YoY Growth across most asset classes Higher equity market activity (with driven by market volatility and value traded up 17% and transactions increased hedging activity in Equity up 4%) supports revenue growth in Derivatives the segment
Slide 6: Revenue by segment and business line
H122 H121 Information services % Growth Revenue Revenue YoY (Rm) (Rm) Funds under management JIS 16% Capital markets 549* 504* 9% Equity 3% 275 253 9% 6% Equity market: trading derivatives 83 74 13% 15% Equity derivatives 7% 3% 14% BDA 5% Primary market 81 74 9% Commodity 6% 15% derivatives Bonds &
Slide 7: All Share index resilient in a global bear market
Global Indices H1 2022 Performance JALSH index S&P 500 index Net Foreign Flows (ZAR bn) Bond Market Equity Market MSCI World index MSCI EM index 100 10% 5% 50 All Share index resilient in the 0% -5% 0 context of a global bear -10% -15% -50 market -20% -25% -100 Jan-22 Jan-22 Mar-22 Apr-22 May-22 May
Slide 8: Financial Review
Financial Review ©Johannesburg Stock Exchange.
Slide 9: Profitability and cash & capital highlights
PROFITABILITY CASH & CAPITAL Cash generated from operations CAPEX Operating revenue Total OPEX EBITDA +10% +3% +20% R534m R51m (2021: R472m) (2021: R46m) to R1.4bn to R880m at R627m (2021: R1.2bn) (2021: R853m) (2021: R520m) HEPS & EPS Net finance Regulatory capital EBITDA margin income +29% Solvenc
Slide 10: Income statement summary
(Rm) H1 2022 H1 2021 D (%) Operating revenue 1 355 1 227 10% Other income 26 15 75% Total revenue 1 382 1 242 11% Personnel expenses 302 292 3% Other operating expenses 453 430 5% EBITDA 627 520 20% EBITDA (%) 45% 42% 3 pts Depreciation and amortisation 125 132 -5% Total operating expenses 880 853 3
Slide 11: Operating expenses
Personnel costs up 3% (R10m) to R302m +3% • Gross remuneration up due to annual salary increases and the first- time inclusion of Share Plan Services R853m R880m • Offset by Long-term incentive scheme (LTIS) share forfeitures Technology costs down 3% (R5m) to R171m 302 292 • Prior-year non-recurring
Slide 12: Capital expenditure
H1 2022 CAPEX up R5m • Rejuvenation of infrastructure and systems 51 • Regulatory enhancements 46 • Growth initiatives - mainly securities collateral 6 4 FY 2022 annual CAPEX guidance of R110m – R130m • Information Services organic growth strategy • Securities collateral • Rejuvenation of infrastruc
Slide 13: Cash generation and conversion
Rm Cash conversion • Cash generated from operations to adjusted NPAT* ratio: 100% Investing activities • Largely intangible assets, plant and equipment, renewal of multi-year software licenses • Globacap “bridging finance” Rm 105% 100% 94% 620 84% 88% 560 525 535 534 522 507 472 444 448 2018 2019 20
Slide 14: Breakdown of cash balance
Breakdown of cash balance (Rbn) Investor protection & other funds (not distributable) • JSE Derivatives Fidelity Fund 2.5 • JSE Guarantee Fund 2.4 • BESA Guarantee Fund 2.1 2.0 • JSE Empowerment Fund Dividends R630m 1.31 1.22 Regulatory capital held in cash (regulatory minimum) Dividends 0.84 0.88 R
Slide 15: 2022 guidance
4% – 7% considering timing differences OPEX growth and planned new initiatives Interest Income Investing JSE Limited’s regulatory 2022 capital in government bonds guidance CAPEX R110m – R130m Independent Capital injection of R115m to meet Clearing House regulatory capital requirements in H2 15
Slide 16: Conclusion
Conclusion ©Johannesburg Stock Exchange.
Slide 17: Protect & Grow, Generate, Transform progress
Launched JSE Private Placements (JPP): 11 Introduced transition & sustainability linked bonds issuances ytd & R10bn in investor capital onboarded Launched actively managed certificates. Actively managed ETFs awaiting final FSCA Launched JSE Trade Explorer to provide approval equity market trade anal
Slide 18: JSE Investor Services progress and H2 expectations
Progress to date Expanded service offering Launch of JSE’s Total revenue Increased market through Sharehub 14 new organic growth of 46% share from 20% Investec Share communication clients wins to 27%* Plan / investor transaction portal (90+ clients) H2 2022 expectations Strong pipeline Planned launc
Slide 19: Resilient business model underpinned by strong cash position
01 Strong performance across all segments 02 Market conditions support momentum RESILIENT BUSINESS MODEL 03 Operational resilience a key strategic enabler UNDERPINNED BY STRONG CASH POSITION 04 Value creation through accretive M&A 05 Sustainability a core strategic pillar 19
Slide 20: Appendix
Appendix ©Johannesburg Stock Exchange.
Slide 21: Listings and capital raised
New bond listings Aggregate market 394 Number of IPOs Additional capital cap. of all equity (2021: 317) 4 raised listed instruments for a (2021: 6) R5bn on the JSE nominal value (2021: R8bn) +7% YoY* of R4.1tr (2021: R3.8tr) New bond listings - No. of warrants and JSE Private sustainability New ETFs
Slide 22: Billable value traded
Billable value traded Published equity Colocation activity +17% YoY to R4.1tr value traded Net foreign inflows** as a % of Net foreign (2021: -8% YoY) +13% YoY (bonds) total value traded outflows** (2021: -8%) of R33bn 65% (equities) ADV* +17% YoY (2021: -R35bn) (2021: 53%) of R20bn to R33bn ADV +13
Slide 23: Billable value traded and transactions
Billable value traded Published equity No. of +17% YoY to R4.1tr value traded transactions/deals (2021: -8% YoY) +13% YoY +4% YoY (2021: -8%) (2021: -19% YoY) Billable ADV +17% YoY to R33bn Published ADV ADTs (2021: -5% YoY to +13% YoY to R26bn +4% YoY to 342k R29bn) (2021: R23bn) (2021: 329k) JIS n
Slide 24: Capital markets historical data
Primary Market (Rm) Equity Trading (Rm) Billable value traded (Rtr) and effective CAPITAL MARKETS rate (bps)* 0.38 0.33 0.33 0.30 0.30 Tiered billing model impact 82 81 277 73 75 74 260 260 4.1 240 3.7 206 3.5 3.4 3.2 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 Billabl
Slide 25: Post-trade and information services historical data
Clearing and Settlement* (Rm) and Back-Office Services (Rm) and cents per POST-TRADE SERVICES effective rate (bps)** transaction 300 0.26 0.25 0.27 0.26 0.3 0.24 250 0.66 0.64 0.64 0.64 0.64 200 0.64 200 0.2 150 0.60 0.62 … 229 100 211 198 100 211 207 0.1 183 173 180 183 50 0.6 0 0 0 0.58 2018 2019
Slide 26: CAPEX envelope
R258m R257m R262m R249m 2 18 18 19 25 27 39 40 R202m - 39 38 39 38 38 7 29 90 83 R110m 71 R240m 74 R240m R243m 25 68 84 92 92 92 82 68 2018 2019 2020 2021 2022F 2023F Existing assets ITaC 1 2022 CAPEX envelope Application of IFRS 16 on lease Licences JIS (incl customer contracts) Figures contain rou
Slide 27: Repo rate and net finance income
SARB’s repo rate (%) and JSE half-year net finance income (Rm) - 2018 – 2022 IFRS 16* - 2019 at R31m 7.0% 120 6.0% 100 5.0% 80 4.0% 60 3.0% 40 2.0% 20 1.0% - 0.0% H1'18 H2'18 H1'19 H2'19 H1'20 H2'20 H1'21 H2'21 H1'22 Net finance income Average repo rate over period *Accounting for leases Average rep
Slide 28: Statement of financial position
(Rm)naming of DDH 2022 30 June 2021 31 December 2021 Assets Non-current assets 1 879 1 874 1 967 Property and equipment 168 120 176 Intangible assets 738 779 727 Investment in associate 315 303 328 Other non-current assets 658 671 736 Current assets 64 359 49 032 59 071 Margin deposits 61 130 45 959
Slide 29: www.jse.co.za
www.jse.co.za ©Johannesburg Stock Exchange. The content of this presentation is strictly reserved for the use of the JSE.