KUALA LUMPUR, April 29 — Bursa Malaysia Bhd kicked off its new financial year on a weak note with a 26.5 per cent drop in first-quarter (Q1) net profit to RM46.86 million due to lower operating revenue.
In a media statement today, the exchange operator said operating revenue fell by 16.2 per cent year-on-year (y-o-y) at RM121.4 million against a backdrop of lower average daily trading on the securities and derivatives markets during the quarter ended March 31, 2019.
Total revenue, meanwhile, decreased to RM126.53 million from RM150.71 million previously, while marketing and development expenses rose mainly due to the higher activities carried out by the securities and derivatives markets, it said.
Chief executive officer Datuk Muhamad Umar Swift said the easier Q1 performance was consistent with the prevailing domestic and global developments, which included concerns of slower economic growth, weaker corporate earnings and palm oil prices.
However, market sentiment is seen to be improving reflected by the positive momentum in monthly average daily trading value (ADV) and monthly average daily contracts that had been trending upwards through the quarter under review.
“While the FTSE Bursa Malaysia KLCI Index weakened in the first quarter, it is important to note that the small and mid-cap indices continue to show a positive trend, with the FTSE Bursa Malaysia Small Cap Index and FTSE Bursa Malaysia Mid-70 Index recording a year-to-date growth of 13 per cent and 9.0 per cent as at end-March,” he said.
In Q1 2019, the securities market segment registered trading revenue of RM59.0 million, down 22.6 per cent from RM76.3 million in last year’s corresponding quarter as a result of lower ADV for securities market’s on-market trades in the quarter under review.
The total non-trading revenue slid 7.6 per cent y-o-y to RM42.1 million mainly due to the decline in listing and issuer services revenue.
However, this was partly offset by higher market data revenue chiefly due to a higher number of subscribers, the exchange said.
The derivatives market’s trading revenue decreased 13.8 per cent y-o-y to RM16.4 million mainly due to lower number of contracts traded for crude palm oil futures and FTSE Bursa Malaysia KLCI Futures, as well as higher market incentives incurred in the quarter under review.
On its prospects, Bursa Malaysia said it expected various domestic and global factors would continue to influence its performance.
However, it would continue with its initiatives to enhance the breadth and depth of the ecosystem through, among others, capitalising on technology to improve market efficiency and trading experience as well as greater diversification of the investor base, it added. — Bernama
