SGX's profit up 7% to $363m in 2018

Almost half of the revenue came from equities and fixed income.

Singapore Exchange (SGX) recorded a 7% growth in its net profit which reached $363.2m as its revenue rose 5% to $845m in FY 2018, an announcement revealed. Operating profit yielded grew 6% to $424.9m whilst earnings per share is at $0.339.

“FY2018 was a record milestone in our financial performance as we achieved our highest revenue since listing in 2000 and the highest profit in five years,” SGX CEO Loh Boon Chye said.

For equities and fixed income, revenue increased 1% to $406.6m, accounting for 48% of the total revenue. Issuer services which saw a revenue growth of 3% to $86.2m, securities trading and clearing which saw a revenue increase of 8% to $221m, and post trade services which saw a revenue decrease of 14% to $99.3m all fall under revenues in equities and fixed income.

“The decline in securities settlement revenue was mainly due to a change in the mix of subsequent settlement instructions,” SGX explained. “Contract processing revenue decreased 71% to S$3.4 million (S$11.6 million) as all brokers migrated to their own back office systems in February 2018.”

Meanwhile, revenue from derivatives rose 12% to $339.8 m. Collateral management, license, membership and other revenue which jumped 24% to $102.8m as well as revenue from commodities which grew 8% to $237.1m contributed to derivatives’ revenue increase.

“This (commodities revenue) was mainly due to higher volumes in SGX FTSE China A50 futures, Nikkei 225 index futures, MSCI Singapore index futures and SGX Nifty 50 index futures,” SGX commented. “Average fee per contract was lower at S$1.06 (S$1.18) mainly due to growth in volumes from trading members.”

For market data and connectivities, revenue rose 5% to $98.3 m due to continued growth in data licences for application systems usage as well as growth in colocation services.

“As we move into the new financial year, our strategy will focus on cementing our position as a multi-asset exchange, while growing our international presence and widening our partnerships and networks,” Loh said.

SGX said that it eyes an opportunity to develop a digital marketplace in the global freight industry, building on the strengths of the Baltic Exchange and its commodity franchise.