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Singapore Exchange Reports Third Quarter Results

Singapore Exchange (SGX: S68) had a good third quarter judging from its earnings release yesterday. The stock exchange operator’s quarterly profit grew by 26% year-on-year from $77.8m to $97.7m while revenue increased by 17% to $191m. The company also generated $115.9m in operating cash flow this quarter, which was an 88% increase from last year’s corresponding quarter’s $61.6m.

The company’s three main businesses; Securities; Derivatives; and Depository services all saw double digit quarterly revenue growth from a year ago. At $75m, Securities revenue was 15% higher than last year’s $65m. Derivatives revenue had the fastest growth at 26% – from $42m to $54m. Lastly, revenue from SGX’s Depository services increased by 17% from $21m to $25m.

Singapore’s stock market participants were certainly busy last quarter as the securities daily average traded value (SDAV) jumped by 17% from $1.5b to $1.7b. In the derivatives market, SGX saw a record in quarterly derivatives daily average traded volume (DDAV) of 479,235 contracts. That’s a 52% increase over last year’s 315,919 contracts.

Corporations in Singapore were also keen to join in the fun as there was a total of $2.4b in equity funds that were raised, a 400% jump from the $0.5b that was raised in the corresponding quarter last year. Five initial public offerings accounted for $955m of the equity funds that were raised, one of which was the highly anticipated IPO of Mapletree Greater China Commercial Trust (SGX: RW0U) which raised S$722m from the public. There were also 107 new bond issues in the quarter that helped bulk up the coffers of participating companies by $48.6b.

SGX expects expenses for financial year 2013 to be between $295m and $305m (it is currently at $219.5m). The company also expects capital expenditures for the full year to be between $30m to $35m, which currently stands at $14m for the year-to-date.

The company has declared an interim dividend of $0.04 per share, which is unchanged compared to last year’s. This brings the total dividends to $0.27 per share over the last 12 months. At Tuesday’s closing price of $7.70, SGX’s shares have a dividend yield of 3.5% and are selling for 27 times earnings.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chong Ser Jing doesn’t own shares in any companies mentioned.