Moscow Exchange Announces Results for the First Quarter 2016 

Moscow Exchange (MOEX) today announces its financial results under International Financial Reporting Standards (IFRS) for the first quarter (1Q) 2016. The quarter saw a significant increase in fee and commission income from the Money Market, FX Market and Derivatives Market, as well as Bond Market.

KEY FINANCIAL HIGHLIGHTS FOR 1Q 2016

• Operating income declined 1.1% YoY to RUB 11.7 bln; fee and commission income increased 32.2% YoY to RUB 5.0 bln;
• EBITDA amounted to RUB 9.2 bln, down 2.6% YoY; the EBITDA margin was 78.1%;
• Net profit amounted to RUB 7.0 bln, down 3.1% YoY; basic earnings per share were RUB 3.1.

KEY CORPORATE HIGHLIGHTS FOR 1Q 2016

• A new product, clearing participation certificates (GCCs), was launched on the Money Market, giving participants greater flexibility to manage their collateral and thus potentially increasing liquidity;
• MOEX benchmarks for the FX, equity, bond and money market segments were recognised as compliant with International Organization of Securities Commissions (IOSCO) principles. This is expected to further strengthen recognition of the Exchange’s benchmarks among global as well as domestic investors and market participants;
• New types of centrally cleared OTC transactions, FX swaps and FX forwards, were added to the product line. These were in addition to central counterparty (CCP) cleared OTC interest swaps and CCP-cleared on-exchange FX, interest and cross-currency swaps and FX forwards;
• T+2 settlement cycle was introduced for U.S. dollar-denominated Eurobonds. Moving Eurobonds to T+ is aimed at boosting liquidity and allowing participants to trade Eurobonds against other assets as collateral;
• Shared registration for clients of market participants has been implemented to unify procedures across the Exchange”s markets, revamp the client registration system and cut costs for market participants;
• Trading began in the FinEx Russian RTS Equity UCITS ETF, the first exchange-traded fund tracking the RTS Index.

EVENTS OCURRING AFTER THE REPORTING DATE

• On 27 April MOEX”s AGM approved record dividends of RUB 16,2 bln for 2015 (the record date was May 16) and elected a new 12-member Supervisory Board, which includes five independent directors. Alexey Kudrin was re-elected as Chairman;
• The seventh annual Moscow Exchange Forum, the flagship event of the Russian financial market, was held in Moscow and drew more than 1,900 financial market professionals;
• MOEX expanded its relationship with CQG, a leading software provider for global financial markets, to provide equities and FX trading via CQG’s API division Continuum, in addition to derivatives. The move aims to ease access to MOEX”s markets for international traders.

Alexander Afanasiev, Chief Executive Officer of Moscow Exchange, said:

“We are pleased to announce substantial 32.2% growth of fee and commission income in the first quarter. This excellent financial result at a time of subdued economic activity and declining market interest rates once again highlights the strength of Moscow Exchange”s diversified product line and the reforms to the market infrastructure we have implemented in recent years.

“We devote a great deal of attention to new products that open up opportunities for market participants and allow us to maintain high levels of profitability. I am particularly pleased to note the growing popularity of repo operations with the CCP and repo with GCCs.

“Our priorities for the second half of the year remain expanding the range of products and services we offer to improve trading and clearing efficiency, attracting more Russian retail clients and continuing our work to promote the Russian market and Russian issuers among international investors.”

Evgeny Fetisov, Chief Financial Officer of Moscow Exchange, added:

“We made a strong start to the year. Fee and commission income increased across almost all our products, with the highest growth rates on the Derivatives Market (+108.3% YoY), Money Market (+50.6% YoY) and FX Market (+48.1% YoY). Lower interest rates led to contraction of interest income as expected, while on the other hand overall client activity increased. Costs remained tightly controlled, rising 7.2% YoY amid higher inflation. Cost discipline allowed us to deliver an impressive EBITDA margin of 78.1%.”

FINANCIAL HIGHLIGHTS

Source: MOEX

 

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