HKEX 2016 First Quarter Results

Key messages

Revenue in Q1 2016 was slightly lower than the equivalent three months ended 31 March 2015 (Q1 2015), which benefited from an exceptional gain on sale of the Group’s investment in LCH.Clearnet Group Limited. The significant drivers of the Group’s revenue during the quarter were:

Subdued activity on the Cash Market in Hong Kong and Commodities Market in the United Kingdom (UK). These returned to levels similar to the fourth quarter of 2015 which were 16 per cent and 9 per cent respectively below Q1 2015.
Significantly increased trading of derivatives contracts on the Hong Kong Futures Exchange Limited, at levels that were higher than both the previous quarter and Q1 2015.

Operating expenses increased by 19 per cent against Q1 2015 primarily reflecting the cost of additional headcount and higher legal and professional fees incurred to support strategic initiatives in Q1 2016. However, the comparison of operating expenses with the prior year is distorted by a one-off recovery of $77 million from the liquidators of Lehman Brothers Securities Asia Limited (Lehman) which reduced the Q1 2015 operating expenses. Excluding this recovery, operating expenses rose by 7 per cent.
The EBITDA margin of 69 per cent was 5 per cent lower than Q1 2015 and 6 per cent lower than the 75 per cent achieved for the year ended 31 December 2015.
Profit attributable to shareholders decreased by 9 per cent to $1,432 million in line with EBITDA. 1 The subsidiaries include The Stock Exchange of Hong Kong Limited (SEHK or the Stock Exchange), Hong Kong Futures

Click here for full details.