SGX Profits Fall on Higher Expenses

The bourse attributed its weaker performance to higher expenses increased and declining treasury income amid a low-interest rate environment.

Singapore Exchange’s fiscal full-year net profit fell 6 percent year-on-year to S$445.4 million ($329.5 million), despite operating revenue growing by 0.3 percent to S$1.06 billion, according to financial statements released on Thursday.

Operating revenue fell 6.8 percent year-on-year for the six months ending 30 June 2021 to S$535.1 million, with the decline coming from its equities segment, SGX said. Its net profit for this period totalled S$205.6 million, down 20.5 percent from S$258.6 million the previous year.

FICC revenue, comprising Fixed Income as well as Currencies and Commodities – Derivatives revenues, increased 24 percent to S$211.8 million, or 20 percent of total revenue. Equities revenue, comprising Equities – Cash as well as Equities – Derivatives revenues, declined 8 percent to S$701.1 million, or 66 percent of total revenue.

Data, Connectivity and Indices revenue increased 18 percent to S$143.1 million, or for 14 percent of total revenue.

Scientific Beta and BidFX contributed 7 percent to the group’s total revenues in FY2021. Along with recently acquired FX trading platform MaxxTrader, total revenue contribution from SGX’s recently acquired subsidiaries would exceed 9 percent, SGX said.

While the low-interest rate environment will continue to impact our treasury income, we believe it will also spur demand for our multi-asset offerings as investors seek enhanced returns, CEO Loh Boon Chye said.

The Board of Directors proposed a final quarterly dividend of 8 cents per share, payable on 22 October 2021, which would bring total dividends in FY2021 to 32 cents per share, up from 30.5 cents in FY2020.