Bursa Malaysia Reports 3Q2011 Profit up 39%
Key Financial & Market Highlights (3Q2011 against 3Q2010)
* Net profit at RM38.6 million, up 39%
* Total operating revenue at RM96.1 million, up 21%
* Securities trading revenue at RM48.9 million, up 20%
* Derivatives trading revenue at RM13.4 million, up 39%
* Total expenses at RM53.1 million, up 11%
* Daily average trading value for securities at RM1.89 billion, up 27%
* Market capitalisation at end-September 2011 is RM1.17 trillion, up 2%
* Velocity at 34%, up 10%
* Total derivatives contracts traded 2.12 million, up 34%
Bursa Malaysia Berhad (Bursa Malaysia) announced October 19 a net profit attributable to shareholders of the Company of RM38.6 million for the quarter ended 30 September 2011, up 39% from RM27.7 million recorded for the same period last year.
Bursa Malaysia’s Chief Executive Officer, Dato’ Tajuddin Atan said, “The third quarter was a trying period for stock markets around the world. Standard & Poor’s downgrade of the U.S. government’s debt rating in August compounded fears of a spiraling European debt crisis and a slowing global economy. Asian markets were not shielded from the impact of these events. For the quarter under review, we saw an increase in both our securities and derivatives trading revenue due to high volatility in both markets.
“Trading revenue from the securities market recorded an increase of 20% to RM48.9 million in the quarter under review compared to RM40.7 million in the corresponding quarter last year. Daily average trading value (DATV) was higher at RM1.89 billion compared to RM1.48 billion in the same quarter last year. Daily average trading volume grew but at a slower pace of 11% to 1.02 billion for the quarter under review compared to 921 million for the third quarter of 2010. For the quarter ended 30 September 2011, market capitalisation stood at RM1.17 trillion from RM1.15 trillion in the same quarter last year. Market velocity stood at 34% against 31% a year earlier.
“Our derivatives market has charted an impressive performance as we celebrated two significant milestones during the quarter. The first was Bursa Malaysia Derivatives’ record achievement of 6,252,675 total contracts traded so far this year by 28 September 2011. This is the highest ever number of contracts traded annually since 1980. The second was the record 4,085,147 Crude Palm Oil Futures (FCPO) contracts traded so far this year by 13 September 2011, which surpassed the previous all-time high of 4,064,361 contracts traded for the whole of 2010. These accomplishments translated into higher trading revenue for the derivatives market, which rose 39% to RM13.4 million in the third quarter from RM9.6 million in the corresponding quarter in 2010. Total derivatives contracts traded were 2.12 million compared to 1.58 million in the same quarter last year. The FTSE Bursa Malaysia Kuala Lumpur Composite Index Futures (FKLI) contracts posted an increase of 40% to 0.70 million contracts traded compared to 0.50 million in the third quarter of 2010. FCPO recorded an increase of 31% to 1.40 million contracts traded compared to 1.07 million in the same period last year.
“Our total expenses increased by 11% to RM53.1 million in the third quarter compared to the corresponding quarter last year. This was mainly due to higher staff costs and service fees paid to CME Group for the use of the Globex® trading platform. The increase in total expenses was partially offset by reduced depreciation and amortisation charges. However, we saw our cost-to-income ratio improve to 49% in the quarter under review compared to 55% for the corresponding quarter last year.
For the nine months ended 30 September 2011, Bursa Malaysia registered a net profit of RM114.8 million, an increase of 38% compared to RM83.3 million for the corresponding period last year. Securities trading revenue increased by 30% to RM152.7 million in the nine months of this year compared to the corresponding period. Derivatives trading revenue increased by 43% to RM38.7 million in the nine months under review, compared to the first nine months of 2010. Total derivatives contracts traded in the nine months ended 30 September 2011 were 6.32 million compared to 4.43 million traded in the nine months of 2010.
“Given the ongoing financial market turbulence around the world, liquidity will continue to be a challenge as investors seek investments that offer the best returns. Having said this, the recent initiatives announced by the Prime Minister in his 2012 Budget speech to spur economic activities under the current challenging environment, together with the implementation of the various transformation plans announced much earlier, will help sustain interest in our stock market. On our part, we will continue our drive to build market competitiveness and vibrancy by focusing on infrastructure efficiency, product innovation and market awareness programmes,” he said.