JSE’s focus on cost control boosts revenue by 8%
Chief executive Nicky Newton-King said yesterday: “Our continued focus on cost control and a one-off tax credit of R31million, R26m tax and R5m related interest, resulted in the JSE’s earnings after tax increasing by 34percent to R561m, up from R419m as compared to last year.”
The costs were down by 5percent to R613m, down from R644m as compared to last year.
“The results were strong in the first half of the year, although they also reflected unpredictability in the markets, but they were better than last year’s. So we are happy that we improved on last year’s results,” Newton-King added.
The company last year embarked on a restructuring of its operations to shed 14percent of its workforce in order to trim its sails.
The group said revenue performance in the first quarter was strong, but the slow-down in volatility in the second quarter trimmed gains.
Group earnings before interest and tax were up by 29percent to R582m, up from R453m, while earnings per share increased by 33percent to 654.7cents a share, up from 490.9c, and headline earnings per share increased by 34percent to 654.6c as compared to last years’ 488.9c.
“The JSE is a largely fixed-cost business. Therefore, we will maintain our focus on costs, while making the necessary capital investments in areas that will enhance the group’s service offering and sustainability.
"Our revenues are variable and largely driven by activity on the various markets that we operate.
"For this reason, the board makes no projections regarding the group’s financial performance in 2018,” it said.
New bourses - such as Equity Express Securities Exchange, ZAR X, 4 Africa Exchange and A2X - are now giving the JSE competition to attract new offerings
The group said there were 10 new equity market listings in the first half as compared to eight listings last year, but this was largely offset by a decline in additional capital raised.
During the period, Cash Equities Market revenue rose by 12percent to R277m owing to the 11percent increase in billable value traded and the increase in the effective price as a result of the trade sizes executed by members.
Equity Derivatives Market revenue decreased by 10percent to R75m.
The group said it was tracking on a target to deliver the committed R170m cost savings by end 2019. It had a strong cash balance at R2.4bn at the end of the period.
JSE's shares closed 2.19 percent lower yesterday at R163.53.