SGX's Q2 net profit jumps 9%

BOURSE operator Singapore Exchange posted a 9.2 per cent jump in second-quarter net profit to S$96.5 million from S$88.4 million a year ago.

Operating profit came in at S$113.7 million, up 10.4 per cent from S$103 million, while expenses rose 8.3 per cent to S$110.5 million mainly due to higher staff costs and professional fees.

Revenue improved 9.3 per cent in the three months to December to S$224.16 million from S$205.05 million.

Equities and fixed income revenue fell 12 per cent to S$85.6 million and accounted for 38 per cent of total revenue while derivatives revenue increased 35 per cent to S$112.9 million, making up 50 per cent of total revenue. Revenue from market data and connectivity rose 6 per cent to S$25.7 million.

Securities daily average traded value (SDAV) fell 14 per cent to S$980 million while total traded value slipped 12 per cent to S$62.7 billion ($71.6 billion); this was made up of equities where traded value declined 14 per cent to S$57.2 billion and other products which saw a 7 per cent increase in traded value to S$5.5 billion.

"We achieved a second consecutive quarter of record performance in our derivatives business, with robust institutional demand for our risk management and hedging tools, including our MSCI Net Total Return index futures and FX futures contracts," said SGX chief executive Loh Boon Chye in the results announcement.

However, he remarked that investor sentiment was dampened by concerns on slower global economic growth and escalating trade tensions, which led to lower activity in the securities business along with other regional markets.

"Notably, we are seeing increased interest in our securities products such as our new single stock daily leverage certificates, as investors seek out more investment opportunities," he added.

Earnings per share for the period under review stood at nine Singapore cents versus 8.2 Singapore cents in the previous year's corresponding quarter.

SGX's board declared an interim dividend of 7.5 Singapore cents per share compared with five Singapore cents a year ago.

For the first half period, SGX's net profit rose nearly 5 per cent to S$188 million on the back of a 5.7 per cent rise in revenue to S$433 million.

SGX shares finished at S$7.50 on Thursday, up nine Singapore cents or 1.2 per cent.