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- GPW Group’s revenue at PLN 88.4 million in Q3 2020
- EBITDA at PLN 47.0 million in Q3 2020
- Operating expenses at PLN 49.8 million in Q3 2020
- Net profit at PLN 32.0 million in Q3 2020
The Warsaw Stock Exchange (GPW) Group generated sales revenue of PLN 88.4 million and a net profit of PLN 32.0 million in Q3 2020. Its EBITDA was 47.0 million in Q3 2020 vs. PLN 55.9 million in Q3 2019.
The GPW Group’s consolidated sales revenue increased by 7.2% year on year and decreased by 13.5% quarter on quarter in Q3 2020. The year-on-year increase of the revenue was driven by an increase of the revenue on the financial market by PLN 11.6 million (25.0%) owing to an increase of the trading revenue on the financial market by 34.3% i.e. PLN 10.3 million including an increase of the revenue from trading in shares and equity-related instruments by 48.6% and an increase of the revenue from trading in derivatives by 4.7% year on year. The revenue from information services increased by PLN 11.2% year on year (up by PLN 1.4 million).
The Group’s revenue from the commodity market decreased by 18.0% year on year and by 26.4% quarter on quarter in Q3 2020. The trading revenue decreased by 15.4% i.e. by PLN 2.9 million year on year and by PLN 3.4 million quarter on quarter. The decrease of the revenue was mainly due to a decrease of the turnover in property rights in certificates of origin by 27.2% i.e. PLN 2.1 million year on year. The decrease in the revenue was due to the termination of trading in cogeneration certificates which stopped in June 2019.
“Q3 was yet another period of strong investor activity on GPW markets as well as a time of our intensive efforts. I am glad that the sun has risen once again in the core business of the exchange. After a very challenging H1 2020, the IPO market has been recovering since July. Allegro’s IPO proves that large companies can also successfully raise capital on the Polish exchange. Moreover, we expect several interesting share offerings in the coming months,” said Marek Dietl, President of the GPW Management Board.
Operating expenses increased by PLN 13.7 million year on year and by PLN 4.8 million quarter on quarter and stood at PLN 49.8 million in Q3 2020. The increase of operating expenses was mainly driven by a higher capital market supervision fee due to the Polish Financial Supervision Authority (PFSA). The final amount of the fee is PLN 13.8 million in 2020 vs. PLN 6.7 million in 2019, an increase of 104.9% i.e. PLN 7.1 million. The cost/income ratio (C/I) was 55.6% in Q3 2020 vs. 43.8% in Q3 2019 and 44.5% in Q2 2020.
Presentation of the GPW Group’s financial results for Q3 2020
Net profit
The net profit of the GPW Group was PLN 32.0 million in Q3 2020, a decrease of 22.2% year on year and a decrease of 26.4% quarter on quarter. The year-on-year decrease of the net profit was mainly driven by a higher PFSA fee and lower sales revenue on the commodity market.
Revenue from the financial market
The sales revenue on the financial market stood at PLN 58.0 million in Q3 2020, representing an increase of 25.0% year on year and a decrease of 4.4% quarter on quarter. The revenue on the financial market contributed 64.7% of the total sales revenue of the GPW Group. The revenue on the financial market includes trading revenue, listing revenue, and revenue from information services.
Trading revenue on the financial market
The trading revenue on the financial market was PLN 40.2 million in Q3 2020 vs. PLN 29.9 million in Q3 2019 and PLN 44.0 million in Q2 2020, representing an increase of 34.3% year on year and a decrease of 8.8% quarter on quarter. The revenue was mainly driven by an increase in revenue from trading in shares, which increased by 48.6% year on year and decreased by 7.9% quarter on quarter.
Listing revenue
The GPW Group’s listing revenue on the financial market stood at PLN 5.0 million in Q3 2020, the same as in Q3 2019 vs. PLN 3.8 million in Q2 2020. The revenue from listing fees stood at PLN 4.1 million in Q3 2020 (-3.1% year on year and +0.2% quarter on quarter). The main driver of listing revenue is the number of issuers listed on GPW’s markets as well as their capitalisation at previous year’s end. The revenue from fees for introduction and other fees stood at PLN 0.9 million (+13.4% year on year). The main driver of this revenue line is the number of new listings on the GPW markets and the value of shares and bonds introduced into trading.
Information services on the financial and the commodity market
The revenue from information services stood at PLN 13.0 million in Q3 2020, representing an increase of 11.2% year on year and a decrease of 1.3% quarter on quarter. The revenue from information services contributed 14.5% of the GPW Group’s total sales revenues.
Revenue from the commodity market
The sales revenue on the commodity market stood at PLN 29.5 million in Q3 2020, a decrease of 18.0% year on year and a decrease of 26.4% quarter on quarter. It contributed 32.9% to the GPW Group’s total revenues in Q3 2020. The revenue on the commodity market includes trading revenue, revenue from operation of the register of certificates of origin, and revenue from clearing.
Trading revenue on the commodity market
The trading revenue on the commodity market decreased by 15.4% year on year and by 17.7% quarter on quarter and stood at PLN 15.9 million in Q3 2020. The revenue from trading in electricity stood at PLN 4.2 million in Q3 2020, a decrease of 12.5% year on year and a decrease of 11.2% quarter on quarter. The revenue from trading in gas decreased by 10.9% year on year and by 2.3% quarter on quarter to PLN 2.9 million in Q3 2020. The revenue from trading in property rights of certificates of origin decreased by 27.2% year on year and by 33.0% quarter on quarter to PLN 5.6 million. The Group’s revenue from other fees paid by commodity market participants stood at PLN 3.3 million in Q3 2020, an increase of 4.0% year on year and a decrease of 3.0% quarter on quarter. The amount of other fees paid by commodity market participants depends largely on the number and the activity of IRGiT Members, in particular the number of transactions.
Operation of the Register of Certificates of Origin
The revenue from the operation of the Register of Certificates of Origin stood at PLN 3.8 million in Q3 2020 vs. PLN 6.2 million in Q3 2019 and PLN 9.1 million in Q2 2020.
Clearing
The Group earns revenues from clearing carried out by TGE’s subsidiary IRGiT. The revenue from clearing stood at PLN 9.6 million in Q3 2020 vs. PLN 10.8 million in Q3 2019 and PLN 11.4 million in Q2 2020. The revenue was driven by turnover volumes on the markets operated by TGE.
Operating expenses
The GPW Group’s operating expenses stood at PLN 49.8 million in Q3 2020, an increase of 37.9% year on year and an increase of 10.6% quarter on quarter. The year-on-year increase of operating expenses was driven by a higher PFSA fee and an increase of salaries and other employee costs and external service charges.
Depreciation and amortisation decreased by 2.2% year on year and 4.1% quarter on quarter to PLN 8.7 million in Q3 2020. The year-on-year decrease in depreciation and amortisation was mainly driven by lower depreciation charges for property, plant and equipment.
Salaries and other employee costs stood at PLN 22.1 million in Q3 2020 vs. PLN 19.2 million in Q3 2020 and PLN 22.3 million in Q2 2020. The increase in salaries and other employee costs was mainly driven by gradual increase in the Group’s headcount due to increasing workload in the implementation of development initiatives under the strategy #GPW2022.
The GPW Group’s cost of rent stood at PLN 1.1 million in Q3 2020, an increase of 1.5% year on year and an increase of 1.6% quarter on quarter.
External service charges stood at PLN 12.9 million in Q3 2020, an increase of 11.8% year on year and 14% quarter on quarter. The increase was mainly driven by a year-on-year and a quarter-on-quarter increase in IT costs.
Share of profit of entities measured by the equity method
The GPW Group’s share of profit of entities measured by the entity method stood at PLN 4.6 million in Q3 2020 vs. PLN 4.7 million in Q3 2019 and PLN 4.4 million in Q2 2020. The share of profit is mainly driven by the net profit of the KDPW Group.
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The Warsaw Stock Exchange Group (GPW Group) operates trading platforms for shares, Treasury and corporate bonds, derivatives, electricity and gas, and provides indices and benchmarks including WIBOR and WIBID. The index agent FTSE Russell classifies the Polish capital market as a Developed Market since 2018. The markets operated by the GPW Group are the biggest in Central and Eastern Europe. For more information, visit www.gpw.pl
