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Investor Relations 9M 2020...Carlos Hank González Eduardo Osuna Osuna Ernesto Ortega Arellano...
Transcript of Investor Relations 9M 2020...Carlos Hank González Eduardo Osuna Osuna Ernesto Ortega Arellano...
Investor Relations9M 2020
COVID-19 Response
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• Full support to our
employees: 21% of
employees received
salary advances during
COVID with flexible
payment options.
• Commitment to our
community and
vulnerable sectors
through donations to
institutions that are
currently having no
income.
• Operational resiliency.
Keeping BMV’s full range
of trading, market
development, and client
support services.
• Keep executing our
BCP protocol for as
long as we need to, in
order to guarantee the
safety of all BMV’s
employees; over 95% of
us are working remotely.
• Operate from a
position of strength
from capital, liquidity
and balance sheet
perspective.
• Focus on risk
management, cash
flow generation and
cost control.
• Strategic
alliances and
technology
platforms that
allow us to
continue
strengthening the
financial
awareness in
Mexico.
We continue building a stronger Mexican exchange through:
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04 27 22 4004 21 26 39
• We make Mexican stock and derivatives
markets work
• Strong Foundation and Execution
• Creating Shared Value
• Top Partners
4
5
6
61% 21% >75% 3.5%-5%
7
8
We create sustainable value
for Mexico through our
services, promoting the best
international practices in
governance, being leaders in
promoting sustainable finance
and contributing to the
strengthening of financial
culture.
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Corporate Responsibility
Our journey towards Sustainability
Code of
ethics and
conduct
S&P/BMV Total
Mexico ESG
Index
Incorporation
into the
Sustainable
Index
Green, Social and
Sustainable Bonds
Corporate
Volunteer
Program
2011 2013 2014 2016 2017 2018 2019 2020
New institutional
philosophy
BMV Foundation
Anti-corruption
and money
laundering
policy
Information Security
Policy
Business
continuity Policy
BMV Podcast
10
Governance
• BMV is guided by a strong Corporate Governance, ethics and best practices.
– Our board is diverse in gender, structure, experience, ages and ideology
– Measures to prevent conflicts of interest with suppliers and employees
• Policies and guidelines
– Electronic Document and Information Processing Policy
– Regulatory and Corporate Compliance Policy
– Treatment and Protection of Personal Data
– Anti-corruption and money laundering policy
– Policy to establish the mechanisms of good corporate governance in financial infrastructures
– Guide for the prevention and identification of operations with illicit resources
– Securities Operations Manual
• Development of new sustainable products/services
– “S&P/BMV Total Mexico ESG Index”
– Green, social and sustainable bonds
• A strong communication campaign of business ethics and institutional values among employees
– Innovation, Service, Excellence, Teamwork, Transparency, Integrity
Board of Directors
1
68
Trust
holding
control
Chairman
Independent
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Board of Directors
Marcos Martínez Gavica
Alberto Torrado Martínez
Alfonso González Migoya
Blanca A. Treviño de Vega
Clemente Ismael Reyes Retana Valdés
Eduardo Valdés Acra
Fernando Ruíz Sahagún
Francisco Gil Díaz
Tania Ortiz Mena López Negrete
Carlos Hank González
Eduardo Osuna Osuna
Ernesto Ortega Arellano
Héctor Blas Grisi Checa
Juan Bordes Aznar
Tomás Christian Ehrenberg Aldford
As of September 2020
Senior Management
Ownership
As of September 2020
23%
77%
Free Float
Trust holding
control
13
Shareholder Structure
• Capital Group Companies Inc 9.2%
• Invesco Ltd 4.3%
• B3 SA - BRASIL BOLSA
BALCAO4.1%
• J.P. Morgan 3.5%
• Franklin Resources 3.4%
• Vanguard Group Inc 2.6%
• Seafarer Capital 2.4%
• Fil Ltd 2.1%
• Blackrock 1.9%
• Goldman Sachs 1.6%
35% is held by Top 10 shareholders:
• BBVA
• Banorte
• Ve por Más
• Santander
• Inbursa
• J.P. Morgan
• Valores Mexicanos
• Value
• Vector
We develop and empower talent
Our collaborators are the most important asset.
We constantly seek to offer the best working conditions, a career plan and trainings. BMV’s workplace
culture is one where every employee feels empowered to bring their authentic self to work every day.
490 Employees
• Average hours of training and
development in 2020: 60
• Learning and development
platform available 24/7
44% 56%
Equal opportunities.
• We are a company with diversity
in gender, structure, experience,
ages and ideology.
• Anyone who wants to develop a
career without restrictions or
limitations can grow at BMV.
• In 2019, a total of 45 vacancies
were filled by internal employees
(26W-19 M).
Training
• The working satisfaction has
increased 4 years in a row according to
our last organizational climate survey.
In 2020 was registered at 86%
• Innovation and teamwork culture:
Both are part of our core values and
many of our improvements and
projects successfully were born thanks
to collaboration initiatives.
• Total employee turnover rate in 2019:
11 (50% less than 2018)
Culture
11% 26% 48% 15%
Baby Boomer X Millennial Z
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Social Development
• In 2020, BMV strengthen the Stock Market and Financial awareness
in Mexico through:
– Exchange School – Online education ( In 2020: 17,500 people | 90
courses).
– Online lectures taught by experts in their fields. All the resources are
available on our You Tube channel.
– MUBO is the only interactive stock market museum in Mexico, which has
had over 100,000 visitors since April 2019 and 7,000 virtual visitors
during the pandemia.
– Means of communication: Blog, Podcast, website and social media.
BMV Group Foundation
- BMV supports art & culture through the promotion of
the creative work of Mexican emerging artists.
Social Programs:
- Volunteer program managed by employees.
- Free lectures in public and private schools.
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Creating shared value
• We have partnered with the following institutions
• BMV is part of the Sustainable Stock Exchanges Initiative and has an active role in environmental
projects in order to grow Green Finance.
• MEXICO2, BMV’s Carbon Exchange, which provides an electronic forum for certificates conferring
the right to emit one tonne of carbon dioxide, thereby attaching a cost to pollution.
• Last year we launched BMV’s Environmental Strategy which points to 5 objectives
Waste
managementBeing an
example in
the market
Emission
neutralizationSaving
water
Energy
efficiency
In 2019, BMV started measuring its carbon footprint, making it one of the only exchanges in Latin
America to take action.
2019 CO2 / ton
Scope 1 – Direct emissions 166
Scope 2 – Indirect emissions 2,360
Scope 1 + 2 2,526
Co2/Income 0.71
Target 2022: 10% reduction CO2 / Income
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Sustainable business
• Since 2016, we have issued 33,160 million pesos corresponding to 16 sustainable bonds (5 green, 10 sustainable and 1 social)
2
3
5
3
2
1
2016
2017
2018
2019
Green Bond Sustainable Bond Social Bond
$3,000
$18,000
$11,460
$700
(Million pesos)
C
• Equity
• Debt
• Green, Social and Sustainability Bonds
• ETFs (TRACs)
• REITs (FIBRAs)
• MLP (Fibra E)
• SPAC
• Development Certificates (CKDs and CERPs)
19
C
• Education
• Financial Risk Management
• Governance, Risk & Compliance
• Specialist software
• IT structure
• MexiCO2
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• Balance between growth potential and cash generating businesses
• Capex (1): 60 - 90
• Depreciation (2): 180 – 230*
(1) Million
(2) Including 100 million pesos in leases (IFRS 16)
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• Green bonds
• Social bonds
• Sustainable bonds
• SPACs
• MLPs
• CO2 certificates
• Block trading books
• Incorporation of limit market
stance
• Short sale optimization
• Improvement of crossing
operations
• Securities lending platform
• Direct Custody
• Clearing and settlement for
new securities
• Automation of Corporate
actions
• LatAm Exchanges Data
• Point of presence in NYC
• Consolidated feed
• Alliance with S&P to build
and distribute indices
globally
• Financial risk management
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It will enable access to the local market infrastructure providing various services to foreign
financial institutions such as broker-dealers, banks, fund managers, insurance companies
and global custodians.
ACCOUNT MANAGER
• Point of contact between our
clients and Indeval
• Customer service platform
(faster responses to queries)
• English speaking account
managers
CORPORATE ACTIONS
• Proxy Voting
• Corporate Events
• Communication via
SWIFT
• Dividend and interest
processing
• Enhanced cut-off
times for instructions
MARKET
INFORMATION
• Extensive Market
reports
• Income
• Safekeeping
TAX
SERVICES
• Tax Reclaim
• Tax Withholding
• Documentation
• Tax reporting
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Indeval: Direct Custody
CCV is implementing risk models for all on-the-run M Bonds in its technological platform.
BENEFITS
• Permanent risk monitoring
• Risk covering by guarantee
funds
• Increased trust in Financial
System
• Mitigation of counterparty risks
• Electronic trading integration for
derivatives and cash market
A UNIQUE BUSINESS
• Independent risk calculation
• Highly experienced staff
• PFMI compliance
• Robust legal framework
• Best practices on clearing and
settlement
INNOVATION
• Cutting-edge risk
engine
• Robust technological
platform
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Clearing Services for Fixed-rate Federal Government Development Bonds
Mexico CityInfrastructure and production, as well first-level
support
MiamiProject management, relationships with
contributors, as well as design, marketing, and
sale of final products
Relevant Information
• Structure – BMV owns 51% of the Mexican company and 49% of the American company.
• Stages – the first stage of development is to establish an information distribution platform for the
delivery of end-of-day data from Latin American markets. The second stage will incorporate real-
time products.
• Investment - up to 10 million dollars with an initial outlay of three million dollars for the
development of the first stage.
LED
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Information Services: LatAm Exchanges Data (LED)
• Fully integrated Exchange
• 125 years of experience
• Diversified business model with 9 revenue segments
• Highest segment contributes 31% of total revenues
• 36% of total revenues are Market driven
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IndevalCentral Securities Depository
8%
6%2%
3%
6%
11%
31%
15%
1%
13%
4%
BMVEquity Trading
SIF Icap MexicoOTC Trading
SIF Icap ChileOTC Trading
AsignaDerivatives Clearing
MexDerDerivatives Trading
CCV Equity Clearing
Maintenance fees
Listing fees
Information Services
2,959Million pesos
9M20 Revenues
Other
Diversified Revenues by Business Activity
9M20 Financial Results
Fee Related Revenue 64% ----------------------Trading Revenue 36%
27
11
19
33
63
12
24
33
53
9
16
27
42
912
17
0
Q1 Q2 Q3 Q42017 2018 2019 2020
138 134 129 127
152 147138 136136 133
128 125134
128 127
0Q1 Q2 Q3 Q4
2017 2018 2019 2020
Listing Revenue(million pesos)
Key Factors
As of June 30th 2020
Maintenance Revenue(million pesos)
1. Listing and Maintenance
As of June 30th 202028
• All instruments have a one time payment
listing fee
• Maintenance fees are paid annually after the
first year of been listed
• Fees are subject to the CNBV approval and
are adjusted annually by inflation.
• 2020: government and other debt duration
12.4 and 6.4 years, respectively.
26%
6%
8%
18%
14% 52%
76%
Maintenance
9M20 Listings
Equity Alternative Debt (Gov) Debt (Corp)
Revenue Mix
IPOs & Follow-Ons (million pesos)
As of September 30th 2020
Local Market
638 739 8561,124 1,245
577
723
923
1,097
1,194
2016 2017 2018 2019 9M20
Equities ETFs
2016 2017 2018 2019 2020
2
9
12
7
2
Global Distribution
• North America 59%
• Europe 35%
• Asia 4%
• South America 1%
• Africa and Oceania 1% As of September 30th 2020
2020 Equity Listings
Global Market
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$55,136 $95,663 $68,358 $5,931 $25,827
1,215
1,462
1,779
2,221 2,439
• Follow-Ons of FIDEAL for 25,827 million on april 21
• Follow-Ons of FSITES for 12,037 million on july 23
36% 42%39%
52%
64% 58%61%
48%
20
17
20
18
20
19
9M
20
Global Local
5145 45 47
51
5954
71
53 54 5650
53
61 59
0
Q1 Q2 Q3 Q4
2017 2018 2019 2020
7567
71 747785
71
84
66 6776
63
79 7869
0
Q1 Q2 Q3 Q42017 2018 2019 2020
• Local and global (SIC) markets.
• Trading revenues are based on the total
value traded during the month.
• Participants must deposit margins to
guarantee their trading activities.
• Fees are subject to Financial Regulator’s
approval and are adjusted by inflation.
As of September 30th 2020
Market Mix
2. Equity Trading and Clearing
As of September 30th 2020
As of September 30th 2020
30
Cash Equity Trading Revenue (Million pesos)
Cash Equity Clearing Revenue(Million pesos)
Key Factors
13,524
16,728
23,721
15,526 17,243 16,650
13,998 13,849 14,944
14,205 13,539 14,392
13,192 12,608 12,576 12,891
14,791 13,656 12,403 12,172 12,526
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec2020 2019
9,873 10,43712,594
14,44312,362 12,934
14,595 14,483 15,726
13,24516,200
34,094 45,45779,318
138,801 155,682197,308
292,247 277,648
379,690 353,586
390,338
0
100,000
200,000
300,000
400,000
500,000
-1,500500
2,5004,500
6,5008,500
10,50012,50014,500
16,500
18,500
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 *9M20
Value Traded Transactions
2019 vs 2020 Daily Average Trading Value per Month(million pesos)
2010 – 2020 Daily Average Trading Value & Transactions per Year(million pesos)
*As of September 30th 2020, Operational Highlights
Operational Highlights
31 As of September 30th 2020, Operational Highlightss
65
57
5154
5052
50 50
4245
55
44
49 50 51
Q1 Q2 Q3 Q42017 2018 2019 2020
29,064
40,03336,637
32,333
42,494
2016 2017 2018 2019 *9M20
Margin Deposits(average in million pesos)
49,71742,261 31,073 25,323 26,415
26,09526,574
22,459 28,174 29,489
2016 2017 2018 2019 9M20
Futures
Swaps
Total Derivatives Contracts(daily average traded)
• MexDer is the only listed derivatives
market in Mexico
• Futures, options and swaps platform
• Liquidity, transparency, clearinghouse
support and self-regulation
• Average margin deposits $42.4 billion
pesos, up 28% compared to 9M19.
As of September 30th 2020
As of September 30th 2020As of September 30th 2020
3. Derivatives Trading and Clearing
32
Derivate Revenue
(Mexder and Asigna in million pesos)Key Factors
IPC Futures
37,47435,292 35,705
32,481
20,088
35,60939,060 42,113
38,958
31,785
2016 2017 2018 2019 2020
Notional Open InterestUSD Futures
136,671 137,380 102,491 82,960 107,184
835,770 910,853
592,701
445,531496,958
2016 2017 2018 2019 2020
Notional Open Interest
DC24 Futures
14,0155,364 3,950 2,760 519
76,330
35,031 33,17317,845
7,867
2016 2017 2018 2019 2020
Notional Open Interest
Swaps
Average as of September 30th 2020
Average as of September 30th 2020 Average as of September 30th 2020
Operational Highlights
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September: 12,327,574 open contracts
Average as of September 30th 2020
0
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
Jan
-16
Ma
y…
Se
p-…
Jan
-17
Ma
y…
Se
p-…
Jan
-18
Ma
y…
Se
p-…
Jan
-19
Ma
y…
Se
p-…
Jan
-20
Ma
y…
Se
p-…
132 130143
154144
170
135 135127
147156 155
193
171
144
Q1 Q2 Q3 Q42017 2018 2019 2020
• Voice and electronic interdealer broker
• Joint Venture with ICAP Plc
• SIF ICAP has presence in Mexico, Peru and
Chile
• Only inter dealer broker in Mexico with an
area dedicated exclusively to corporate
bonds
México38%
Chile62%
Revenue Mix Products
• Government bonds
• Banking and corporate bonds
• Swaps (IRS and currency)
• Forwards (currency)
• Warrants
As of September 30th 2020
As of September 30th 2020
4. OTC Trading
34
OTC Revenue
(Million pesos)Key Factors
146 145
195209209
232220
240238253 262 260
301317
304
Q1 Q2 Q3 Q42017 2018 2019 2020
• Indeval is the only CSD in Mexico, safekeeping
+1.1 trillion USD and servicing local equities &
ETFs, Mexican government & corporate bonds,
pension & mutual fund shares, as well as
foreign securities listed in the Global Market SIC
• Indeval is the 9th largest CSD in the world in
terms of daily average value according to BIS*
statistics, and processing Transactions in
pesos for +270 billion USD 9M20
• In July 2017, we implemented a new model for
the Global Market that reduced +50% the costs
for intermediaries and as a result foreign assets
doubled by June 2020. Global Market Services
include cross-border settlement, corporate
actions, tax services (US Tax Forms – W8,W9).
• Custody fees are regulated by the National
Banking and Securities Commission
• Indeval has several projects under development
to enhance service levels, reduce costs for
market participants and continue diversifying
revenue sources.
As of September 30th 2020
Custody36%
Global Market Services
39%
Securities Lending
2%
Transactions22%
Other1%
Revenue Distribution
As of September 30th 2020
5. Central Securities Depository
35
Indeval Revenue
(Million pesos)Key Factors
* Bank for International
Settlements*Transactions / Securities & Cash Management
3.1 3.4 3.5 3.9
0.60.7 0.7
0.81.11.2 1.2
1.34.85.3 5.5
6.0
2017 2018 2019 9M20
Government Debt Bank Debt Equities Cash .
7.6 7.9 8.3 8.9
9.0 8.9 7.6 7.4
5.1 5.7 6.2 6.82.6 2.9 3.3 3.224.4 25.3 25.5 26.3
2017 2018 2019 9M20Government Debt EquitiesPension / Mutual Funds Corporate Debt
As of September 30th 2020
Custody and Transactions Highlights
36
Average daily settlement amount
(average in trillion pesos)
Total Assets Under Custody
(average in trillion pesos)
Gov. Debt64%
Bank Debt13%
Equities1%
Cash22%
Amount Settled Distribution: 9M20
As of September 30th 2020
1012
1111
12 12
18
15 15
1716
1719
78
6 78 8
18
9
11
10
10
8 8
0
2
4
6
8
10
12
14
16
18
20
0
2
4
6
8
10
12
14
16
18
20
Bill
ion
US
D
Thousands
Number of Operations Settlement Amount
Assets Settlement – Global Market
Equities20%
ETFs80%
As of September 30th 2020
Global Market Services Highlights
37
27.4
40.142.0
46.3
2017 2018 2019 9M20
Assets Under Custody - Global Market(average in billion USD)
46 BUSD
Asset Mix: 9M20
50.1
38.3
49.5
36
38
40
42
44
46
48
50
52
54
56
-1,000
-500
0
500
1,000
1,500
Au
g-1
9
Au
g-1
9
Se
p-1
9
Oct-
19
Oct-
19
Nov-1
9
Dec-1
9
Dec-1
9
Ja
n-2
0
Feb
-20
Feb
-20
Mar-
20
Ap
r-2
0
Ap
r-2
0
May-2
0
Ju
n-2
0
Ju
l-20
Ju
l-20
Au
g-2
0
Se
p-2
0
Se
p-2
0
AuC
Bill
ones
US
D)
Nete
o(M
illones U
SD
)
AuC vs Neteo ConversiónSIC
Netting SIC AuC SIC (USD)
124
103 110 106114 114
136
115
147137 140 135
145 148157
0
Q1 Q2 Q3 Q4
2017 2018 2019 2020
• Valmer is an authorized price vendor and
risk management software provider
• Market Data provides screens, information
stations and data feeds
• Strategic alliance with S&P for production
and distribution of fixed income and equity
indices
Revenue Mix
EquityFixed
Income
Indices 16 105
ETFs referenced
to an index17 5
As of September 30th 2020
As of September 30th 2020, Financial Results
S&P/BMV Indices
As of September 30th 2020
6. Information Services
38
Information and Services Revenue (Million pesos)
Valmer28%
Market Data72%
Key Factors
• EBITDA Margin: 61%
• EPS: 1.39 9M20
• ROE: 21%
• 9M20 Dividend Yield: 3.6%
• DPS: 1.81
• Payout Ratio: 80%
39
Revenue
Up 11%
$2,959 MM
(9M 2019: $2,663 MM)
Net Income
Up 14%
$1,168 MM
(9M 2019: $1,028 MM)
Expenses controlled while
investing for growth
Up 4%
$1,315 MM
(9M 2019: $1,260 MM)
EBITDA
Up 16%
$1,795 MM
(9M 2019: $1,543 MM)
EBITDA Margin
Up 271 bps
61%
(9M 2019: 58%)
Dividends per Share
80% Payout
$1.81
(2018: $1.78)
9M20 Key Financial Highlights
Strong financial performance from market related businesses and the Central Securities Depository, as well as tight control of underlying costs
40
BMV´s financial results*Excluding impairment of goodwill in 2008/14/15/19
EBITDA Margin
• EBITDA Margin: 58% – 61% • Net Income: $1.4 B - $1.6 B
Guidance 2020
Sustainable Growth
41
95% 77% 77% 77% 80%
39%
44% 45% 46% 47%43%
50%53% 55% 55%
58%61%
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
201
8
201
9
9M
20
681 968 1,160 1,360 1,338 1,168
646
741
895
1,052 1,071
2015 2016 2017 2018 2019 9M20
Net Income, Dividend & Payout(million pesos)
Net Income Dividend Payment
Thousand pesos3Q20, Financial Results
3Q20 3Q19 Var. Var. %
Revenues 961,663 933,745 27,919 3.0%
Cash Equities 126,985 131,991 -5,006 -3.8%Cash equities trading- BMV 69,154 75,528 -6,375 -8.4%
Cash equities clearing- CCV 57,831 56,462 1,369 2.4%Derivatives 51,078 53,664 -2,586 -4.8%
MexDer 19,664 25,229 -5,566 -22.1%
Derivatives trading 16,635 22,504 -5,869 -26.1%
Data sales-MexDer 3,029 2,726 303 11.1%Derivatives Clearing- Asigna 31,414 28,434 2,980 10.5%
Derivatives Clearing 31,039 28,386 2,652 9.3%Data Sales- Asigna 376 48 328 688.0%
OTC (SIF ICAP) 143,627 156,254 -12,627 -8.1%
OTC trading 142,075 154,909 -12,833 -8.3%
SIF ICAP México 54,283 62,491 -8,208 -13.1%
SIF ICAP Chile 87,792 92,417 -4,625 -5.0%
SIF ICAP data sales 1,552 1,346 206 15.3%
Capital Formation 144,328 154,248 -9,920 -6.4%Listing fees- BMV 16,910 26,746 -9,836 -36.8%
Maintenance Fee- BMV 127,417 127,502 -85 -0.1%Central Securities Depository (CSD) 303,927 261,501 42,426 16.2%
Information Services 156,679 140,354 16,324 11.6%
Price Vendor- Valmer 44,138 53,846 -9,708 -18.0%
Data Sales 112,540 86,508 26,032 30.1%
Others 35,041 35,733 -692 -1.9%Colocation 5,029 6,247 -1,218 -19.5%
Others 30,012 29,486 526 1.8%
Revenues Overview – quarterly YoY
42
8%6%
2%3%
6%
11%
31%
15%
1%
13%4%
Equity Trading
SIF IcapMex
SIF Icap Chile
Asigna
MexDer
CCV
OtherMaintenance fees
Listing fees
Information and
Services 9M20
Indeval
Indeval
8%7%
7%
6%
11%
19%
11%
7%
8%
16%2%
Equity Trading
SIF IcapMéxico
Asigna
MexDer
CCV
Other
Listing fees
Market Data
Valmer
2008
Indeval
Maintenance fees
Evolution of Revenue Mix
43
Thousand pesos
Good control of underlying expenses
• Personnel - Expenses related to employees (salary, benefits and other expenses). SIF
ICAP has a variable compensation based on performance.
• Technology - Expenses related to the technological platform that the company uses to
carry out its operations and the purchase of data.
• Sub-Custody - Fees generated by the securities service operated outside Mexico.
• CNBV – Financial regulator fees.
9M20 9M19 Var. Var.
Expenses 1,315,245 1,260,312 54,933 4.4%
Personnel 679,767 658,149 21,618 3.3%
Technology 195,849 183,882 11,967 6.5%
Depreciation 151,141 140,687 10,454 7.4%
Rent and Maintenance 48,760 49,311 -550 -1.1%
Consulting Fees 70,328 69,759 569 0.8%
Sub-Custody 73,457 62,458 10,999 17.6%
CNBV Fees 22,410 21,763 646 3.0%
Others 73,532 74,303 -771 -1.0%
Expenses Overview - quarterly YoY
44
• Revenues in dollars: 25%
• Expenses in dollars: 23%
Flat USD position
Operating Income Net IncomeEBITDA
Growth Rate: 9M20 vs 9M19
1,439
1,642
1,865 1,914
1,644 1,512
1,734
1,948 2,015
1,795
968
1,161
1,376 1,338
1,668
2016 2017 2018 2019 9M20Operating Income EBITDA Net Income
9M20, Financial Results
17%
20%
21%
20%
21%
2016
2017
2018
2019
9M20
Historic ROE Operating Income, EBITDA & Net Income(Million pesos)
16%17% 14%
Income Growth
45
Figures in million pesos9M20, Financial Results
Summarized Cash Flow 9M20
Strong cash generation
46
414
1,488
1,488
1,548
1,583
2,129
2,222
0
1073
0
61
35
546
93
0
Free Cash Flow
Dividends to controllingshareholders
Discretionary free cashflow
Dividend paid to non-controlling
Investment activities
Taxes paid
Hardware leases
Cash Generates andChanges in WC
• Cash at the beginning of the period
$3,100MM
• Cash at the end of period $3,514MM due to
maintenance revenue which is collected in
advance.
• $35MM capex – mainly building
improvements and new projects.
• $151MM depreciation and amortization.
• Cash generation-discretionary free cash
flow remains strong at $2.51 per share.
• Free Cash Flow Yield in 2019 was 6.6%
• Cash Flow Return on Investment in 2019
was 28.6%
• Total Assets $8.3 B
• $3.5 B cash and
investments
• Total Liabilities $1.0 B
• Shareholders’ Equity
$7.2 B
• Book Value $4.1 B
3Q20, Financial Results
Sep-20 Dec-19
Total Assets 8,340 7,868 472 6%
Cash & Investment 3,514 3,100 414.5 13%
Accounts Receivable 370 404 -33.3 -8%
Recoverable Taxes 37 14 23.0 168%
Total Current Assets 3,921 3,517 404.1 11%
Amortization expenses 83 55 28.4 52%
Other Non-Current Financial Assets 193 166 26.3 16%
Investments in Associated Companies 30 39 -9.2 -23%
Fixed Assets 471 479 -8.6 -2%
Goodwill 3,084 3,084 0.0 0%
Other Non-Current Assets 558 527 30.9 6%
Total Non-Current Assets 4,419 4,351 67.8 2%
Total Liabilities 1,085 808 277 34%
Suppliers and Other Accounts to Pay 529 444 84.7 19%
Deferred Income 171 11 159.7 1441%
Taxes Payable 127 176 -49.0 -28%
Other Short Term Financial Liabilities 0 0 0.0 0%
Total Current Liabilities 827 631 195.4 31%
Bank Loans & Provisions 258 177 81.6 46%
Total Long Term Liabilities 258 177 81.6 46%
Stockholders´ Equity 7,255 7,060 195 3%
Capital Stock 4,507 4,507 0.00 0%
Premium in issue of shares 0.211 0.211 0.00 0%
Retained Earnings and Reserves 1988 1960 27.47 1%
Other Results 457 344 113.56 33%
Minority Interest 302 248 53.89 22%
Liabilities + Stockholders´ Equity 8,340 7,868 472 6%
Balance Sheet Common-size analysis
47
-30%
-20%
-10%
0%
10%
20%
30%
BOLSA NAFTRAC
Stock Performance
Source: Bloomberg
Analyst Recom.Target Price
Date
Grupo Santander Buy 54 09/sep/2020
J.P. Morgan Buy 50 21/jul/2020
HSBC Hold 38 17/sep/2020
Credit Suisse Buy 54 25/sep/2020
Itau BBA Securities Buy 41.5 15/jul/2020
Barclays Sell 46 12/aug/2020
Bradesco BBI Buy 51 03/jun/2019
Bank of America Buy 50 17/sep/2020
UBS Hold 44 18/feb/2020
Monex Hold 48 21/apr/2020
Vector Buy 56 20/jul/2020
Average 48
Top 10 HoldersAs of September 30th, 2020
Capital Group Companies Inc 9.2%
Invesco Ltd 4.3%B3 SA - BRASIL BOLSA BALCAO 4.1%J.P. Morgan 3.5%Franklin Resources 3.4%
Vanguard Group Inc 2.6%
Seafarer Capital 2.4%
Fil Ltd 2.1%
Blackrock 1.9%
Goldman Sachs 1.6%
Annual Return: 35.0% Annual data: June 30th, 2020 BOLSAA NAFTRAC
Max 50.8 45.9
Min 28.7 33.0
Average Price 42.5 39.8
Close 50.1 37.4
Max Volume (thousands) 7,268.6 91,345.8
Min Volume (thousands) 27.4 183.1
Average Volume (thousands) 1,134.2 15,055.3
Dividend Per Share 1.8 0.4
Dividend Yield 4.3% 0.9%
Return 3M (Price) 16.5% -0.8%
Return 12M (Price) 35.0% -12.9%
Return 12M (TSR) 39.9% -12.1%
Return YTD (Price) 21.2% -14.0%
3M: 16.5%
September 30th, 2019 – September 30th, 2020
BolsaA vs Naftrac (5-year)
49
-25%
-5%
15%
35%
55%
75%
95%
11
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15
15
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19
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22
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26
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29
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28
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31
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06
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18
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21
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21
/08
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20
BolsaA Naftrac
September 30, 2015- September 30 2020
TSR BolsaA 125%
TSR Naftrac -6%
Local
Competitor
Changes to SIC’s
business model
(Global Market)
LatAm
Exchanges
Data
Price Return BolsaA 89%
Price Return Naftrac -12%COVID-19
Contacts
Luis René Ramón
Director of Financial Planningand Investor Relations
[email protected]+52 (55) 53 42 9027
Paseo de la Reforma 255, Col. Cuauhtémoc, 06500, Cd. de México
For information on the Group: www.bmv.com.mx
M. Nalleli Barajas
Head of Corporate Responsibility
[email protected]+52 (55) 53 42 9293
50