Oslo Børs VPS Holding ASA 2nd Quarter 2012 · •MiFID II and MiFIR - More level playing field and...
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Transcript of Oslo Børs VPS Holding ASA 2nd Quarter 2012 · •MiFID II and MiFIR - More level playing field and...
Oslo Børs VPS Holding ASA 2nd Quarter 2012
15 August 2012
2nd quarter at a glance
• Continued good level of activity in the fixed income
market
• Challenging conditions in the primary and secondary
equities and derivatives market
• First phase of the mutual funds project delivered
• Work in progress on the new trading system
(Millennium Exchange) and a more efficient clearing
solution (Magica)
• Fast-track listing process now in place
• New opening hours with effect from 6 August
3
2nd quarter at a glance
• Revenues down 8% to
NOK 218 million from Q211
• Operating expenses up from
Q211. In line year to date.
• EBITDA down 18% to NOK 107
million from Q211
• EPS NOK 1.24 – down 23%
from Q211
4
0
50
100
150
200
250
300
Q210 Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
NO
K m
illi
on
Revenues Oslo Børs VPS
0 %
10 %
20 %
30 %
40 %
50 %
60 %
0
20
40
60
80
100
120
140
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
NO
K m
illi
on
EBITDA and EBITDA-margin Oslo Børs VPS
EBITDA EBITDA margin
Oslo Børs
• Revenues down 10% to
NOK 102 million from Q211
• EBITDA down 19% to NOK 57
million from Q211
• Reduced activity in equities
• Increased activity in fixed
income instruments
• Implementation of Millennium
in November 2012
5
0
20000
40000
60000
80000
100000
120000
140000
Q3
2010
Q4
2010
Q1
2011
Q2
2011
Q3
2011
Q4
2011
Q1
2012
Q2
2012
NO
K 1
00
0
Revenues Oslo Børs
Equity Markets Fixed Income Markets Derivatives Markets Financial Market data Other
0 %
10 %
20 %
30 %
40 %
50 %
60 %
70 %
80 %
0
10
20
30
40
50
60
70
80
90
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
NO
K m
illi
on
EBITDA and EBITDA-margin Oslo Børs
EBITDA EBITDA margin
Oslo Børs – primary market
• Steady increase in number of listed
bonds and certificates
• Fixed fees from issuers down 2%
from Q211
• Fixed fees driven by number of
issuers and market capitalisation
January 1
• Reduced market cap. 1 Jan 2012
6
Valu
e (
NO
K b
ill)
No. of bonds
0
5000
10000
15000
20000
25000
30000
35000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues primary market
Fixed fees- issuers Prospectus and admission fees
1000 1100 1200 1300 1400 1500 1600 1700 1800 1900 2000
200
210
220
230
240
250
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Mark
et
cap (
NO
K b
ill)
No. of is
suers
Number of and market capitalisation of issuers of
equity
No. of issuers Market cap (NOK bill)
1000
1050
1100
1150
1200
1250
1300
100
300
500
700
900
1100
1300
1500
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Valu
e
Num
ber
Number and market value of listed bonds and
certificates
Number Value (NOK bill)
Oslo Børs – primary market
• Prospectus and admission fees
in line with Q211
• Revenues driven by number
and size of IPOs and issues
• Two new listings in Q212
• Low level of issues of equity in
Q212
• High level of issues of fixed
income instruments
7
0
5 000
10 000
15 000
20 000
25 000
30 000
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
NO
K m
illi
on
Issues of equity
Issues (NOK mill)
0
1
2
3
4
5
6
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
New listings
No. of listings
Oslo Børs – secondary market
• Low market activity in Q212
• Revenues down 20% from
Q211
• Equity revenues driven by
trading activity and members
choice of fee structures
• Derivatives revenues driven
by activity level and
composition of derivatives
trading
- No of contracts down 35%
from Q211
- Revenues down 34% from
Q211
8
Valu
e
Tra
ns
-
10 000
20 000
30 000
40 000
50 000
60 000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues secondary market
Equities trading Derivatives trading Fixed Income trading
3 000
3 500
4 000
4 500
5 000
5 500
6 000
6 500
7 000
200
250
300
350
400
450
500
550
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Tra
ns
Valu
e
Equities - value of turnover and number of
transactions
Value (NOK bill) Trans (1000)
Market share - equities trading
9
On-exchange trading June 2012 Total YTD 2012
• Increased use of Smart Order Routers
• Increased internalisation in Europe
(Source: Thomson Reuters)
46 % 52 %
60 % 64 %
0 %
10 %
20 %
30 %
40 %
50 %
60 %
70 %
London Stockholm Frankfurt Oslo O
rd
er b
oo
k lit
- m
arket
sh
are
Oslo
43,20 %
Markit BOAT 24,10 %
CHI-X 11,50 %
LSE Group 11,50 %
Nasdaq OMX Nordic 5,00 %
Turquoise 2,40 %
Other 2,20 %
Oslo Børs – market data
• Revenues down 4% from
Q111
• Revenues primarily driven
by number of professional
end users of data from Oslo
Børs
• Professional users down 7%
from Q211
• Increase in private users
• One-off items in Q111
- Customer audits
10
46 000
48 000
50 000
52 000
54 000
56 000
58 000
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Market data - number of end-users
29000
30000
31000
32000
33000
34000
35000
36000
37000
38000
39000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues market data
Key market activities
• Millennium to be implemented in
November 2012
- Owned and used by London Stock
Exchange Group
- One of the world’s fastest trading system
- A flexible system
- Attract new members and trading volume
• Continous development of
microstructure
- Marketplace rules, pricing structure,
technology, networks and products
- New opening hours
- New tariffs for high frequency trading
• Efficient post trade
- Interoperability
• Fast track procedure for listing
11
Oslo Clearing
• Revenues down 27% from Q211
• Shift from transaction to value based
fee-schedules
• Derivatives activity down 35% from
Q211
• Clearing revenues driven by
• trading activity and members choice of fee structures
• activity level and composition of derivatives trading
• Interoperability with LCH Q412
• Magica – increased competetiveness
in clearing
12
Contr
acts
c
Turn
over
0
5000
10000
15000
20000
25000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues clearing
Equities clearing Derivatives clearing
10 000
30 000
50 000
70 000
90 000
500
1 500
2 500
3 500
4 500
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Derivatives - number of standardised contracts
and value of turnover
Contracts (1000) Turnover (MNOK)
VPS
• Revenues down 2% to
NOK 106 million from Q211
• EBITDA down 7% to NOK 51
million from Q211
• Reduced revenues in all areas
except for investor
• Fund system released in June
13
0
20000
40000
60000
80000
100000
120000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues VPS
Investor products Issuer products Settlement products
Fund products Other revenues
0 %
10 %
20 %
30 %
40 %
50 %
60 %
0
10
20
30
40
50
60
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
NO
K m
illi
on
EBITDA and EBITDA-margin VPS
EBITDA EBITDA margin
VPS – investor products
• Revenues up 5% from
Q211
• Revenues primarily driven
by number of VPS accounts
and market value of
holdings January 1
14
0
5000
10000
15000
20000
25000
30000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues investor products
3400
3600
3800
4000
4200
1 300
1 350
1 400
1 450
1 500
1 550
1 600
1 650
1 700
1 750
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Number of investor accounts and market value of holdings
VPS accounts (1000) Holdings (NOK bill)
VPS – issuer products
• Revenues down 3% from Q211
• Revenues driven by number
and composition of issuers and
level and composition of
corporate activity
- AGM-season in Q2
• Additional revenue from value
added products
- AGM-services
- Stock purchase programs
- Nominee-ID
15
0
5000
10000
15000
20000
25000
30000
35000
40000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues issuer products
-
500
1 000
1 500
2 000
2 500
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Number of companies and bond issues registered
Companies Bond issues
VPS – settlement products
• Revenues down 7% from Q211
• Revenues driven by number of
participants and number of
settlement transactions
16
0
5000
10000
15000
20000
25000
30000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues settlement products
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Number of trade transactions processed in VPS (1000)
VPS – fund products
• Revenues down 1% from
Q211
• Reduction in volumes from
Q212
• Revenues primarily driven
by assets under
management and number
of transactions
• First part of new fund
system released in June
• Program extended with
development of new
functionality
17
AU
M (
NO
K b
ill)
Tra
nsaction (
1000)
0
5000
10000
15000
20000
25000
Q3 2010
Q4 2010
Q1 2011
Q2 2011
Q3 2011
Q4 2011
Q1 2012
Q2 2012
NO
K 1
00
0
Revenues fund products
0
200
400
600
800
1000
1200
1400
1600
1800
0
100
200
300
400
500
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
Asset under management and number of transactions
AUM (NOK bill) Transactions (1000)
Oslo Market Solutions
• Revenues down 12% from
Q211
• EBITDA up 12% from Q211
• Transfer of revenuestream
to VPS as of 2012
18
AU
M (
NO
K b
ill)
Tra
nsaction (
1000)
-1
0
1
2
3
4
5
6
7
Q310 Q410 Q111 Q211 Q311 Q411 Q112 Q212
NO
K m
illi
on
Revenues and EBITDA Oslo Market Solutions
Revenues EBITDA
European regulation - implications
• MiFID II and MiFIR
- More level playing field and increased transparency
• EMIR
- Opportunity for CCPs in mandatory clearing
- Requirements for CCPs – organisation, capital and access and
interoperability
• CSD-legislation
- Increased competition – opportunity and threat
• Financial transactions tax?
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20
Largest shareholders 30 July 2012 Investor Antall aksjer % av 20 største % av total Type Land
DNB LIVSFORSIKRING ASA 8 522 045 23,85% 19,82% Sels. NOR
KOMMUNAL LANDSPENSJONSKASSE 4 300 200 12,03% 10,00% Sels. NOR
PARETO AS 3 662 230 10,25% 8,52% Sels. NOR
ORKLA ASA 3 510 700 9,82% 8,16% Sels. NOR
LANDSBANKINN HF 2 812 930 7,87% 6,54% Nom. ISL
ARENDALS FOSSEKOMPANI ASA 1 996 000 5,59% 4,64% Sels. NOR
JP MORGAN CLEARING CORP. 1 984 575 5,55% 4,61% Nom. USA
NORSK HYDROS PENSJONSKASSE 1 900 000 5,32% 4,42% Sels. NOR
STATE STREET BANK AND TRUST CO. 959 355 2,68% 2,23% Nom. USA
MSF-MUTUAL FINANCIAL SERVI FD 911 000 2,55% 2,12% Sels. USA
MORGAN STANLEY & CO INTERNAT. PLC 725 700 2,03% 1,69% Nom. GBR
NORDEA NORDIC SMALL CAP FUND 718 841 2,01% 1,67% Sels. FIN
MUST INVEST AS 708 520 1,98% 1,65% Sels. NOR
SUNDT AS 657 500 1,84% 1,53% Sels. NOR
FRANKLIN TEMPLETON EXCLUSIVE 622 000 1,74% 1,45% Sels. LUX
STATE STREET BANK AND TRUST CO. 447 895 1,25% 1,04% Nom. USA
BANQUE DE LUXEMBURG S.A 347 960 0,97% 0,81% Nom. LUX
MSF-MUTUAL EUROPEAN FUND 340 000 0,95% 0,79% Sels. USA
MP PENSJON PK 306 394 0,86% 0,71% Sels. NOR
CLEARSTREAM BANKING S.A. 303 250 0,85% 0,71% Nom. LUX
Antall aksjer hos de 20 største 35 737 095 100% 83,10%
Totalt antall aksjer 43 004 000 100%
Summary
• Revenues affected by European
downturn in trading and listing
activities
• Underlying operating costs in line
with 2011 year to date
• Focus forward
- Attract new listings/registrations
and members
- Increased sale to existing
customers
- Strengthen competitive position in
secondary market
- Trading, clearing and settlement
- Successful execution of projects
- Millennium, Magica, Fund project, modernisation of VPS IT
- Consider opportunities to increase
scale in post trade, e.g. share
technology
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Appendix
23
P&L 2nd Quarter 2nd Quarter Change 30. June 30. June Change
2012 2011 in % 2012 2011 in % 2011
Operating revenues 217 820 237 089 -8 % 439 647 480 129 -8 % 921 894
Operating expenses
Capitalisation of internal resources -1 977 -2 320 -3 719 -4 996 -9 016
Salary and other personnel expenses 61 414 60 316 134 916 138 172 272 804
Other operating expenses 49 785 45 323 96 041 92 993 181 828
Depreciations and write-downs 17 021 16 046 34 224 32 183 71 217
Amortisations 23 441 27 265 46 883 54 530 109 061
Operating expenses before capitalisation of internal
resources, depreciations and amortisations 111 199 105 639 5 % 230 957 231 165 0 %
Total operating expenses 149 684 146 630 2 % 308 344 312 882 -1 % 625 894
EBITDA 106 621 131 450 -19 % 208 690 248 964 -16 %
Operating profit (EBIT) 68 136 90 459 -25 % 131 304 167 247 -21 % 296 001
Net financial items 6 146 6 183 11 801 12 231 24 817
Ordinary pre-tax profit 74 281 96 642 143 105 179 478 320 818
Tax 20 848 27 114 40 159 50 345 87 773
Earnings for the period 53 433 69 528 -23 % 102 946 129 133 -20 % 233 045
Actuarial gains/losses
defined benefit pension plans 0 0 0 0 -19 135
Tax-effect 0 0 0 0 5 358
Total comprehensive income 53 433 69 528 -23 % 102 946 129 133 -20 % 219 268
Earnings per share (NOK) 1,24 1,62 -23 % 2,39 3,00 -20 % 5,42
Diluted earnings per share (NOK) 1,24 1,62 -23 % 2,39 3,00 -20 % 5,42
Breakdown revenues – Oslo Børs segment
24
Revenues per area Q2 2012 Q2 2011 30.06.2012 30.06.2011 2011
Equity Markets 54 144 61 371 109 556 125 488 243 177
Fixed Income Markets 8 093 7 628 16 210 15 240 31 152
Derivatives Markets 5 312 8 096 10 829 17 954 32 675
Financial Market data 32 456 33 876 65 437 71 631 138 648
Other 1 918 2 192 5 115 4 492 8 687
Total Oslo Børs 101 923 113 162 207 147 234 805 454 339
Revenues per category Q2 2012 Q2 2011 30.06.2012 30.06.2011 2011
Fixed fees- issuers 19 561 20 036 39 187 40 312 82 041
Trading fees 37 142 46 462 80 720 100 102 192 577
Prospectus and admission fees 9 238 9 410 14 091 15 879 27 485
Financial market data 32 456 33 876 65 437 71 631 138 648
Other income 3 526 3 379 7 712 6 881 13 589
Total Oslo Børs 101 923 113 162 207 147 234 805 454 339
Breakdown revenues – VPS segment
25
VPS Q2 2012 Q2 2011 30.06.2012 30.06.2011 2011
Investor products 25 625 24 338 52 867 50 474 97 124
Issuer products 36 027 37 242 63 832 62 854 116 180
Settlement products 23 325 25 156 49 215 51 041 100 883
Fund products 18 000 18 197 38 821 40 108 75 797
Other revenues 2 695 3 097 5 638 6 617 11 949
Total VPS 105 672 108 030 210 373 211 094 401 933
26
Balance sheet 30. June 30. June 31. Dec
2012 2011 2011
Fixed assets
IT-systems 300 600 403 471 345 997
Customer relations 38 715 54 207 46 461
Registrations 10 000 10 000 10 000
Goodwill 464 233 464 233 464 233
Deferred tax assets 89 043 73 483 88 770
Tangible assets 59 520 56 871 51 337
Financial fixed assets 73 756 45 845 75 389
Current assets
Market value of outstanding derivatives positions 511 328 761 470 380 055
Receivables 89 343 97 662 81 555
Investments - 14 892 -
Cash and cash equivalents 771 086 746 155 892 870
Assets 2 407 624 2 728 288 2 436 667
Equity
Contributed equity 1 346 390 1 411 311 1 501 325
Earned equity - - -
Total equity 1 346 390 1 411 311 1 501 325
Liabilities
Pension liabilities 224 448 186 762 218 698
Deferred tax liabilities 62 252 90 649 75 379
Cash collateral - 30 154 33 096
Market value of outstanding derivatives positions 511 328 761 470 380 055
Current liabilities 263 206 247 941 228 114
Equity and liabilities 2 407 624 2 728 287 2 436 667
27
Cash flow 2nd Quarter 2nd Quarter 30. June 30. June
2012 2011 2012 2011 2011
Cash flow from
- operational activities 36 855 49 893 160 585 197 119 368 373
- investment activities -17 876 -1 433 -23 962 -5 130 -28 981
- financing activities -258 106 -344 302 -258 407 -344 561 -345 247
Cash and cash equivalents at
period's start 1 010 212 1 041 996 892 870 898 726 898 726
Change in cash and cash equivalents -239 126 -295 842 -121 784 -152 572 -5 856
Cash and cash equivalents at
period's end 771 086 746 155 771 086 746 155 892 870
Cash flow per share (NOK) -5,56 -6,88 -2,83 -3,55 -0,14
28
Equity 2nd Quarter 2nd Quarter 30. June 30. June
2 012 2011 2012 2011 2011
Equity at period's start 1 550 834 1 685 623 1 501 325 1 626 019 1 626 019
Total comprehensive income 53 433 69 528 102 946 129 133 233 045
Dividends -257 878 -343 838 -343 838
Purchase of own shares 0 0 -122
Acturial gains/losses in the period -13 777
Equity at period's end 1 346 390 1 411 311 1 346 390 1 411 311 1 501 325
Equity ratio 56 % 59 % 56 % 59 % 55 %
Share price Oslo Børs VPS Holding ASA
29
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Price N
OK
