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- GPW Group generated a net profit of PLN 41.9 million in Q2 2017 (up by 51.2% QoQ)
- EBITDA stood at PLN 56.1 million (up by 30% YoY)
- Cost/income ratio in Q2 2017 among the lowest ever at 43.1% (down by 15.7% QoQ and 15.6% YoY)
- Revenue on the commodity market up by 12.2% YoY and 1.0% QoQ
The GPW Group generated a record-high quarterly net profit of PLN 41.9 million in Q2 2017 (up by 51.2% QoQ) and a revenue of PLN 87.6 million, down modestly (3.7%) compared to Q1 2017, when the GPW Group had generated historically high revenue. The revenue increased by 17.7% year on year. EBITDA was historically high at PLN 56.1 million in Q2 2017.
“Q2 2017 was a good quarter: the GPW Group generated not only a record-high net profit but also historically high EBITDA. We successfully reduced operating expenses; as a result, the cost/income ratio was among the lowest ever. The outlook for the coming quarters is supported by the take-over of the function of WIBID and WIBOR fixing organiser by GPW Benchmark as well as a positive market sentiment including on-going recovery on the IPO market,” said Jacek Fotek, Vice President of GPW.
Operating expenses stood at PLN 37,8 million in Q2 2017 and the cost/income ratio was among the lowest quarterly ratios ever at 43.1%, down by 15.7% QoQ and 15.6% YoY.
The revenue from the commodity market was PLN 34.7 million in Q2 2017, representing an increase of 1% QoQ and 12.2% YoY, and contributing 39.6% of the total revenue of the GPW Group. The revenue from trade in property rights increased from PLN 8.7 million in Q1 2017 to PLN 11.1 million in Q2 2017, driven by growing trade in white certificates (+29.1% QoQ) and green certificates (+39.8% QoQ). Revenue from trade in electricity also increased quarter on quarter thanks to a growing volume of forward transactions. Revenue from trade in gas decreased due to seasonally lower volumes (PLN 1.9 million in Q2 2017 vs. PLN 2.5 million in Q1 2017).
Presentation of the GPW Group’s financial results for Q2 2017
Net profit
The net profit of the GPW Group was PLN 41.9 million in Q2 2017, an increase of 26.7% year on year and an increase of 51.2% quarter on quarter.
Revenue from the financial market
The sales revenue from the financial market was PLN 52.6 million in Q2 2017, representing a decrease of 5.6% compared to record-high Q1 2017 and an increase of 22.4% year on year. The revenue from the financial market contributed 60.0% of the total sales revenue of the GPW Group, compared to 61.2% in Q1 2017 and 57.7% in Q2 2016. The revenue from 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 36 million in Q2 2017, representing a decrease of 7.4% quarter on quarter and an increase of 35.4% year on year. The trading revenue was mainly driven by a decrease of EOB trade in equities by 12.7% QoQ and an increase of 42.7% YoY to PLN 58.3 billion in Q2 2017. The volume of trade in derivatives was 2 million contracts in Q2 2017 (decrease of 11.9% QoQ and 0.4% YoY) and the volume of trade in WIG20 futures was 1.24 million contracts (decrease of 3.5% QoQ and increase of 3.9% YoY).
Listing revenue
The GPW Group’s listing revenue on the financial market was PLN 6.1 million in Q2 2017, a decrease of 4.4% quarter on quarter and an increase of 1.0% year on year. The listing revenue represented 7% of the GPW Group’s total revenue in Q2 2017.
Information services
The revenue from information services was PLN 10.6 million in Q2 2017, representing an increase of 0.4% quarter on quarter and 2.7% year on year. The revenue from information services contributed 12.0% to the GPW Group’s total sales revenues. The increase was mainly driven by the development of the GPW Group’s offer of non-display data used in electronic trading, a stable number of subscribers, as well as the first contracts for WIBOR and WIBID data (Thomson Reuters, Bloomberg, SIX Financial, Interactive Data, VWD).
Revenue from the commodity market
The sales revenue on the commodity market was PLN 34.7 million in Q2 2017 compared to PLN 35 million i.e., 1.0% less than in Q1 2017. It contributed 39.6% to the Group’s total revenues in Q2 2017. The revenue from 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 increased from PLN 15.6 million in Q1 2017 to PLN 17.6 million in Q2 2017. The revenue was PLN 14.1 million in Q2 2016.
Operation of the Register of Certificates of Origin
The revenue from the operation of the Register of Certificates of Origin was PLN 7.8 million in Q2 2017, representing a decrease of 14.6% quarter on quarter and 0.2% year on year. The quarter-on-quarter decrease in the revenue from the operation of the Register of Certificates of Origin was driven by smaller numbers of certificates issued and cancelled in Q2 2017.
Clearing
The revenue from clearing was PLN 9.3 million in Q2 2017, representing a decrease of 10.4% quarter on quarter and an increase of 2.8% year on year. The decrease of revenue from clearing was driven mainly by seasonality on the gas market.
Operating expenses
Operating expenses were PLN 37.8 million in Q2 2017, a decrease of 18.8% quarter on quarter and 0.7% year on year. While external service charges increased by 29.2% QoQ due to higher IT costs (POLPX trading system) and advisory costs (POLPX’s VAT payments), the total operating expenses decreased. Salaries went down by 4.8% QoQ.
Depreciation and amortisation
Depreciation and amortisation charges stood at PLN 7 million in Q2 2017 compared to PLN 6.4 million in Q1 2017. The increase of depreciation and amortisation charges by 9.9% QoQ was driven by the implementation of POLPX’s new trading system as well as investments in the implementation of MiFID II.
Share of profit of associates
The GPW Group’s share of profit of associates was at PLN 3 million in Q2 2017 compared to PLN 1.5 million in Q1 2017 and PLN 1.4 million in Q2 2016. The share of profit of associates was mainly driven by the earnings of the KDPW Group and Aquis Exchange. KDPW’s profit attributable to GPW was PLN 3.5 million in Q2 2017 compared to PLN 2 million in Q1 2017. KDPW’s very strong earnings were driven by a high volume of trade on the financial market as well as one-off fees related to general meetings and dividend payments. The multilateral trading facility Aquis Exchange generated a loss in Q2 2017, including a loss attributable to the GPW Group at PLN 0.8 million (the same as in Q1 2017).
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The Warsaw Stock Exchange (GPW) is one of the fastest growing securities exchanges in Central and Eastern Europe. GPW has been a market of first choice for local and international investors in Europe for 26 years. GPW operates a regulated market of shares and derivative instruments and the alternative stock market NewConnect for growing companies. GPW is developing Catalyst, a market for issuers of corporate and municipal bonds, as well as commodity markets. The Polish Power Exchange (POLPX), a member of the GPW Group since February 2012, offers trade in electricity, natural gas, property rights, guarantees of origin, and CO2 emission allowances. Since 9 November 2010, GPW is a public company listed on Warsaw Stock Exchange. For more information, visit http://www.gpw.pl
