Friday 29 Mar 2024
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This article first appeared in The Edge Financial Daily on October 30, 2019

KUALA LUMPUR: Bursa Malaysia Bhd’s net profit for the third quarter ended Sept 30, 2019 (3QFY19) fell 6.2% to RM47.1 million from RM50.19 million for the same quarter last year as revenue declined.

Quarterly earnings per share, accordingly, slipped to 5.8 sen from 6.2 sen, its bourse filing showed.

Revenue was down 5.5% year-on-year at RM122.67 million versus RM129.82 million previously, largely due to an 8.8% decline in securities market trading revenue to RM55.8 million from RM61.2 million.

For the nine-month period ended Sept 30, 2019 (9MFY19), Bursa’s net profit retreated by 18.5% to RM140.3 million, from RM172.19 million for the same period last year, as revenue fell 11.4% to RM373.16 million from RM421.09 million.

Higher marketing and development expenses to attract more participants also contributed to a slight increase in costs, which was mitigated by lower staff costs during the period.

In a separate statement, Bursa chief executive officer Datuk Muhamad Umar Swift said the initial public offering pipeline had remained solid despite the challenging operating environment.

“To date, the exchange has already welcomed 27 new listings, surpassing the 21 total listings in 2018. Among major Asean bourses, Bursa Malaysia also ranked second for funds raised and the number of new listings in 9MFY19,” he said.

In terms of the securities market’s performance in 9MFY19, he said it had continued to be influenced by both global and domestic developments, such as the heightened risk of a global economic slowdown, easing of global financing conditions and weaker corporate earnings.

“Taking into consideration the exchange’s performance to date and the continued challenging environment, we expect to register a satisfactory performance for the rest of the year, supported by positive domestic catalysts in the recently announced Budget 2020.

“The government’s efforts, directed at developing key economic growth areas such as Islamic finance, digitisation and entrepreneurship, will be key drivers towards sustainable economic growth in the longer term.

“The proposal for tax deduction for expenses of up to RM1.5 million incurred for the listing of technology-based companies and small and medium enterprises on the ACE and LEAP Markets for three years from 2020 to 2022, and the extension of the existing tax treatment for investors of REITs (real estate investment trusts) by an additional six years until 2025 will certainly provide continued impetus in generating listing interest and attracting local and foreign investors into our capital market,” he added.

Bursa shares closed unchanged at RM6.06 apiece yesterday, giving it a market capitalisation of RM4.9 billion. In the past 12 months, the stock has retreated 17%.

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