Singapore Exchange (SGX) has reported earnings of $121.8 million for 4Q20 ended June 30, 16.6% higher than the $103.9 million a year ago.
This brings SGX’s earnings for FY20 to $471.8 million, representing a 20.6% y-o-y increase.
Operating revenue for 4Q20 grew 12.2% y-o-y to $278.4 million. For FY20, the bourse registered 15.7% higher revenue y-o-y at $1.05 billion, the highest since its listing.
EBITDA for FY20 grew 25% y-o-y to $656 million.
SGX reported double digit growth in all business segments.
FICC revenue – comprising both Fixed Income and Currencies and Commodities – Derivatives revenues – increased 23% y-o-y to $171.4 million and accounted for 16% of total revenue.
Equities revenue – comprising Equities – Cash as well as Equities – Derivatives revenues – rose 14% y-o-y to $759.7 million, accounting for 72% of total revenue.
Data, Connectivity and Indices revenue increased 19% y-o-y to S$121.6 million, accounting for 12% of total revenue.
EPS (earnings per share) rose 21% y-o-y to 44.1 cents for the year.
The board has proposed a final quarterly dividend of 8 cents per share for 4Q2020, an increase of 0.5 cents from the previous quarter. This will be payable on October 9.
“Covid-19 led to heightened market uncertainty and volatility. This had led to an increase in volumes,” says Chief Financial Officer Chng Lay Chew in a virtual press conference on July 30.
Total expenses, comprising operating expenses, and depreciation and amortisation, increased by 8% y-o-y to $486.9 million.
Operating expenses increased 3% y-o-y to $397.0 million, mainly from higher staff costs, processing and royalties expenses, and cost relating to the SGX Care Package. This was partially offset by credits from the Job Support Scheme provided by the government of Singapore.
Total staff costs increased 12% y-o-y to $215.2 million. Fixed staff costs increased $8.1 million or 6% to $137.5 million ($129.4 million) mainly due to the consolidation of staff cost of Scientific Beta, annual staff salary increments, and an increase in headcount. This was partially offset by a one-off $5.5 million credit from the Job Support Scheme.
Average headcount for the year was 872, up from 820 y-o-y, including 34 staff from Scientific Beta. Provisions for variable staff costs increased $15.7 million or 25% to $77.7 million ($62.0 million), in line with higher profitability.
“During the year, we expanded our product range and broadened our platform capabilities, while increasing the number of global customers adopting our multi-asset products and services. We also welcomed Scientific Beta to the SGX Group and announced the acquisition of BidFX, a cloud-based front-end trading platform for currencies, to expand our FX offering,” says Chief Executive Officer Loh Boon Chye.
Total expenses for FY2021 is projected to be between $535 million and $545 million. Excluding costs associated with Scientific Beta and BidFX, total expenses would be lower by $15 million.
Capex is projected to be between $55 million and $60 million in FY2021. The increase is due to capital expenditure of BidFX, excluding which capital expenditure would be lower by $11 million.
Looking ahead, market activity could ease following heightened volumes in the second half of FY2020, said Loh, although risk management activities could grow from continued uncertainty as geopolitical tensions between US and China escalate, and global economies recover from the Covid-19 pandemic at varying speeds.
On Jul 30, SGX shares closed 5 cents lower, or 0.61% down, at $8.17.
