Johannesburg Stock Exchange revels in market volatility

 ·2 Aug 2022

The Johannesburg Stock Exchange (JSE) on Tuesday (02 August), reported a strong performance for the first half of 2022, delivering revenue growth across all segments.

Headline earnings per share (HEPS) increased by 29% year-on-year (YoY) to 542.7 cents per share, while operating revenue was up 10% to R1.35 billion.

Earnings before interest tax depreciation and amortisation (EBITDA) increased by 20% to R627 million, with the EBITDA margin improving from 42% to 45% in the corresponding period in 2021, the group said.

“Throughout this period, uncertainty in the markets manifested in volatility and higher trade activity. The depth of the JSE’s operational capabilities has ensured resilience during these volatile periods,” said Leila Fourie, Group CEO at the JSE.

“I am particularly pleased with the contribution of annuity revenue derived from business uncorrelated to trading activity and our disciplined cost management. These steady improvements create positive momentum and together underpin the quality of earnings in line with our strategy.”

The group launched its JSE Private Placements (JPP), an automated and digitised platform that offers services to private entities looking to raise debt or equity. The online solution connects private companies and issuers directly to investors, enabling private capital formation in a more transparent, efficient, and accessible manner. Since its launch in January 2022, JPP has eleven issuances year to date and over R10 billion in investor capital onboarded, the group said.

The JSE also launched JSE Trade Explorer to provide equity market trade analytics. It also grew JSE Investor Services (JIS) market share, from 20% at acquisition to 27%, and added 14 new clients.

Revenue performance per segment:

Capital markets

  • Primary Market: Revenue increased by 9% to R81 million (2021: R74 million)
  • Equity Trading: Revenue increased by 9% to R260 million (2021: R240 million)
  • Equity Derivatives Trading: Revenue increased by 13% to R83 million (2021: R74 million)
  • Bond and Interest Rate Trading: Revenue increased by 6% to R38 million (2021 R36 million)
  • Currency Derivatives Trading: Revenue increased by 12% to R20 million (2021: R18 million)
  • Commodity Derivatives Trading: Revenue increased by 5% to R49 million (2021: R46 million)
  • JIS: Revenue increased by 46% to R76 million (2021: R52 million)

Post-Trade Services

  • Clearing and Settlement revenue increased by 10% to R229 million (2021: R207 million)
  • Back-office services (BDA) revenue increased by 4% to R180 million (2021: R173 million)
  • Funds under management revenue increased by 13% to R45 million (2021: R40 million)

Looking ahead, the JSE said its focus for the second half of the year will be to invest in its core business to sustain operations, whilst progressing its growth strategy for Information Services, formulated on a five-year horizon. “Our long-term strategic objectives are to grow and diversify revenue streams, invest in our infrastructure to ensure operational robustness and resilience, and further entrench sustainability (ESG) in the business,” said Fourie.

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