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[HONG KONG] Hong Kong Exchanges & Clearing Ltd, the most valuable exchange operator in Asia, said full-year earnings rose to a record on higher trading turnover.
Net income jumped 54 per cent to HK$7.96 billion (US$1 billion) last year, up from HK$5.17 billion a year earlier, the exchange said in a statement on Wednesday. Revenue increased 36 per cent to HK$13.38 billion in the period. Analysts were expecting net income of HK$8 billion, according to data compiled by Bloomberg.
HKEx's fourth-quarter net income and revenue were little changed from the year-ago period, at HK$1.5 billion and HK$2.8 billion, respectively, according to Bloomberg calculations using the full-year and nine-month reports.
Equity daily trading fell to an average HK$71.9 billion in the fourth quarter from HK$101.5 billion three months earlier. The average daily number of options contracts traded also fell in the fourth quarter to 334,000. The average number of futures contracts dropped to 308,000 from 323,000 in the third quarter.
The bourse, which plans to introduce new index and currency futures, said it saw its average daily stock-trading turnover rise 52 per cent to HK$105.6 billion in 2015. Daily trading has averaged about HK$72.5 billion this year, 13 per cent lower than in the same period a year earlier, according to datacompiled by Bloomberg. The company needs to expand its trading links with China to generate additional revenue, some industry analysts said.
"We don't see any catalysts for the earnings drivers in the first half of 2016," said Edmond Law, a Hong Kong-based analyst with UOB-Kay Hian Holdings Ltd.
The planned expansion of the equity-trading link between Hong Kong and Shanghai to Shenzhen may generate extra revenue for the exchange, he said.
HKEx's shares gained 3.3 per cent to HK$174.70 at 2:06 pm in Hong Kong trading.