Bursa Malaysia Profits Increase 11%
Key Financial Highlights Full year 2010 against 2009
* Profit of RM113.0 million, up 11% compared to FY2009 normalised profits (if exclude capital gain of RM76 million from the disposal of 25% equity interest in Bursa Malaysia Derivatives Berhad from FY09 profits)
* Net profit of RM113.0 million, down 36% (if include RM76 million gain on the disposal of 25% equity interest in Bursa Malaysia Derivatives Berhad in FY09 profits)
* Securities trading revenue up 21%
* Derivatives trading revenue declined marginally by 2%
* Total expenses up 8%
* Daily average trading value for securities rose to RM1.6 billion
* IPO listings jumped to 29 vs. 14 in 2009
* Market capitalisation rose to RM1.27 trillion vs. RM999.4 billion
Bursa Malaysia Berhad (Bursa Malaysia) registered a profit of RM113.0 million for the financial year ended 31 December 2010, an increase of 11% in comparison to normalised profits of RM101.6 million in 2009. However, the net profit for the Group was down 36% compared to 2009’s net profit of RM177.6 million as a result of the one-off capital gain of RM76 million in 2009. Bursa Malaysia will declare a final dividend of 10.5 sen per share for the period under review, which is a distribution of 94% of its net profit.
Bursa Malaysia’s Chief Executive Officer, Dato’ Yusli Mohamed Yusoff said, “We are pleased with our results which is on the increase year on year. We are confident that the company is well-positioned for continued growth for this year, in view of the positive market sentiment that we have witnessed. The steady performance of the securities market demonstrates the confidence of investors in capitalising on the growth prospects of the economy and positive transformation plans by the Government.”
Trading on the securities market picked up towards the second half of last year. The daily average trading value for the securities market rose to RM1.6 billion for the period under review compared to RM1.2 billion in the same corresponding period. This resulted in a significant increase of the trading revenue of 21% to RM167.9 million from RM139.1 million in the previous year. Market capitalisation reached RM1.27 trillion for 2010 versus RM999.4 billion in 2009.
For the period under review, the derivatives market experienced a marginal decline in terms of trading revenue which stood at RM37.6 million in 2010 compared to RM38.5 million in the previous year. This decrease is attributed to the lower guarantee fees due to the lower average daily open positions recorded in 2010. The total number of derivatives contracts traded held steady at 6.15 million contracts in 2010 versus 6.14 million contracts in 2009. The crude palm oil futures (FCPO) contracts showed a slight improvement in its growth of which a total of 4.06 million contracts were traded in 2010 compared to 4.01 million in 2009.
Stable revenue increased by 4% to RM107.8 million in 2010, from RM103.6 million in the 2009. This improvement was attributed to an increase in IPOs, structured warrants and secondary issues.
Total expenses increased by 8% to RM196.7 million for 2010 due to our efforts to recruit and retain talent as well as the cutover from Bursa Trade Derivatives (BTD) to CME’s Globex® electronic trading platform in September 2010, which resulted in accelerated depreciation of BTD and license fees for the use of Globex.
During the period under review, Bursa Malaysia successfully attracted 29 initial public offerings (IPOs) which raised RM19.9 billion compared to RM12.0 billion in 2009.
Additionally, the market witnessed an increase of structured warrant listings to 204 in 2010 from 124 in 2009. Dato’ Yusli commented, “The increase in new listings certainly reflects the improving confidence and sentiment of issuers in the timing of the market. We are definitely working towards providing greater diversity to our investors and we look forward to more listings as our market continues to be relevant to prospective issuers.”
Bursa Malaysia continues to deliver value to shareholders by declaring a dividend which represents a payout of 94% of the company’s net profit ended 31 December 2010. Its Board of Directors will propose a final dividend of 10.5 sen per share, which will be tabled at the company’s 34th Annual General Meeting.
On the bourse’s anticipated performance for the coming year, Dato’ Yusli said, “The market has got off to a strong start and we are optimistic that the momentum will continue in the medium term, which will augur well for our financial performance this year. We expect to see continued interest in our securities market, with growth that is comparable with regional peers. Furthermore, we are very much focused to improve our derivatives business via widening our distribution channels, increasing sales force and providing greater accessibility to our products. These efforts are very much geared towards boosting contracts growth and increasing the demand from foreign players towards our derivatives offerings.”