KUALA LUMPUR, Aug 1 ― Bursa Malaysia Bhd posted a lower net profit of RM46.34 million for the second quarter ended June 30, 2019 (Q2 2019) from RM58.21 million in the same period last year, dragged mainly by securities and derivatives markets performance.
Revenue fell to RM123.96 million from RM140.55 million.
In an exchange filing today, Bursa Malaysia said the securities market recorded a segment profit of RM74.6 million in Q2 2019 from RM87.2 million in 2Q18 mainly due to lower operating revenue.
“Derivatives market recorded a segment profit of RM8.5 million in 2Q19 from RM11.6 million in 2Q18, which was mainly attributed to lower operating revenue,” it said.
For the first half of 2019 (1H 2019), the exchange net profit lowered to RM93.19 million from RM122.0 million while revenue slid to RM250.49 million versus RM291.27 million previously.
For the half-year under review, Bursa Malaysia, in a separate statement, said the securities market performance was influenced by both global and domestic developments, centred on concerns of softening global growth, easing of global financing conditions and weaker corporate earnings.
“Trading revenue decreased by 19.6 per cent to RM117.8 million in 1H 2019 from RM146.5 million in 1H 2018, mainly due to lower average daily value (ADV) for securities market’s on-market trades,” it said.
The bourse added that the total non-trading revenue decreased by 5.9 per cent to RM81.3 million in 1H 2019 from RM86.4 million in 1H 2018, mainly due to the decline in listing and issuer services revenue from lower initial and annual listing fees, as well as lower perusal and processing fees.
“Despite these external headwinds, the securities market performance for 2H 2019 is expected to be resilient, as the month of June 2019 saw foreign investors turned net buyers in the securities market with the trend continuing into July 2019,” it said.
On the derivatives market, Bursa Malaysia said trading revenue decreased to RM33.3 million in 1H 2019 from RM38.7 million in 1H2018, mainly due to the lower number of contracts traded for crude palm oil futures and the FTSE Bursa Malaysia KLCI futures.
“The ADC for the derivatives market saw a decrease of 9.9 per cent to 49,351 contracts in 1H 2019 compared with 54,794 contracts in 1H 2018,” it said.
As for the Islamic capital market, it said trading revenue for Bursa Suq Al-Sila’ (BSAS) in 1H 2019 increased 2.5 per cent to RM7.6 million, while ADV for BSAS surged 49.8 per cent to RM32.1 billion in 1H 2019.
“Trading on BSAS is expected to sustain its strong performance through expansion of its global reach and onboarding of new domestic non-bank participants onto its platform,” it said.
Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift said Malaysia's markets performed in line with expectations, as investors continued to adopt a cautious stance for the first half of the year.
“Notwithstanding the challenging operating environment, we will forge ahead to build on our strengths such as in the Islamic capital market, which continues to show a positive momentum,” he said.
Muhamad Umar said there were various positive indicators that gave the market reasons to be optimistic, among them the positive trend in trading amongst small and mid-cap counters and encouraging increase in initial public offerings (IPOs), which led to the exchange occupying the top spot among major Asean bourses in terms of funds raised via IPOs as at 1H 2019 totalling RM1.4 billion.
“We are also seeing improvements in foreign direct investments. These are all good opportunities for us to build upon,” he said. ― Bernama
