Bursa Malaysia Posts Record 205% Q1 Net Profit Increase, Revenue Up By 113%

Bursa Malaysia Berhad (Bursa Malaysia) today reported a net profit after tax of RM70.2 million for the first quarter of 2007 – a 205% increase compared to the net profit after tax of RM23.0 million for the corresponding period last year. For the quarter ended 31 March 2007, Bursa Malaysia’s operating revenue grew by 113% to RM124.3 million from RM58.3 million registered in the previous corresponding period ended 31 March 2006. This is a record quarter performance for Bursa Malaysia since going public in March 2005.

Bursa Malaysia’s strong performance in the first quarter of 2007 is attributed to a buoyant equity market which traded at a daily average trading value of RM2.8 billion compared to RM1.0 billion recorded in the first quarter of 2006. Quarterly velocity hit a high of 68%, compared to 30% in the first quarter of 2006. The bullish equity market, combined with volatile trading activities, contributed to a remarkable increase in revenue from the equity market by 165% to RM86.8 million from RM32.7 million in the first quarter of 2006.

Bursa Malaysia Berhad’s Chief Executive Officer, Dato’ Yusli Mohamed Yusoff said, “We are very pleased with the record performance achieved, which provides a solid platform for Bursa Malaysia to achieve its objectives of creating a competitive and efficient marketplace as well as delivering continued value to its shareholders. The first quarter financial results certainly exceeded our expectations and provided a positive reflection of the greater trading activity over the last few months. The average daily trading value so far this year had exceeded RM2 billion a day, indicating an active marketplace which demonstrates improved investor confidence towards the market’s prospects.”

The derivatives market took its cue from the equity market and bullish sentiments surrounding crude palm oil (CPO), and posted a 120% increase in trading revenue to RM12.9 million in the first quarter of 2007 from RM5.9 million in the first quarter of 2006. Total contracts traded increased by 129% to 1.6 million in the first quarter of 2007. KLCI futures traded increased by 171% to 0.9 million contracts, while CPO futures traded increased by 104% to 0.6 million contracts.

Dato’ Yusli commented, “It is encouraging to see our derivatives trading gain momentum, fuelled by continued demand for products and services in this area. This supports our strategic objectives of pursuing domestic growth and further making the market more attractive to investors by introducing more initiatives in derivatives such as the US Dollar crude palm oil contracts and Direct Market Access (DMA) for derivatives which will be launched in the second half of this year.”

Listing fees grew by 136% to RM6.4 million in the current quarter due to the revision in listing fees. The total number of listed companies and REITs as at 31 March 2007 was 1,035 compared to 1,031 in the previous corresponding quarter. The growth in listings has been somewhat slowed down by the increasing number of delistings as a result of continuous efforts to improve the quality of the Malaysian market.

Operating expenses increased marginally by 5% mainly due to higher market development and promotional expenses as various initiatives are implemented to enhance the competitiveness and efficiency of the exchange.

During the period under review, retail participation in the equity market increased to 39% in 2007 compared to 34% in 2006. Dato’ Yusli said, “The market has been performing very well, driven by strong trading volume and sustained investor interest, both domestic and foreign. Bursa Malaysia itself broke trading records recently and we are optimistic that the market outlook will remain competitive.” Dato’ Yusli added that to ensure the market’s sustainable performance, Bursa Malaysia’s efforts for the rest of the year will be geared towards improving the market’s velocity and liquidity via addressing various gaps in a focused manner. Currently, BursaMalaysia is working towards infrastructural improvements as well as broadening its product base.

The presentation of the financial results for the first quarter of 2007 is also available on Bursa Malaysia’s website (www.bursamalaysia.com).