TASE records adjusted profit of close to NIS 26 million in the second quarter, compared to NIS 20 million last year
- Revenue in the second quarter of 2024 totals NIS 105.1 million, a 13% increase compared to NIS 92.9 million in the corresponding quarter last year.
- Adjusted EBITDA in the second quarter of 2024 totaled NIS 45.8 million, compared to NIS 35.6 million in the corresponding quarter last year, an increase of 29%.
- Adjusted net profit in the second quarter of 2024 totaled NIS 25.7 million, compared to NIS 20.4 million in the corresponding quarter last year, an increase of 26%.
Ittai Ben Zeev, TASE CEO, said today: “TASE continues to show resilience and support the Israeli economy against the backdrop of the ongoing war. We continue to push forward with technological innovation, implementing advanced infrastructure and promoting collaborations in order to upgrade the market, remove barriers and enhance its global accessibility. Now more than ever we are resolved to continue developing the capital market, as part of our unwavering commitment to the Israeli economy, which is pivotal to our national strength.
As part of these efforts, we recently published, in cooperation with the Israel Securities Authority and the Bank of Israel, a call for public comments on the proposal to align the TASE trading week with the global standard; a strong positive response was received in favor of changing to a Monday-through-Friday trading week. We are confident that this strategic move that will make TASE more readily accessible for global investors and increase their involvement in the Israeli capital market, benefiting the Israeli economy in general and the local companies in particular. We are currently examining all the public comments received in order to reach the most fitting solution, both for international investors and for the Israeli capital market."
Tel Aviv, August 7, 2024 - The Tel-Aviv Stock Exchange Ltd. (TASE: TASE) today announced its financial results for the second quarter ended June 30, 2024.
Trading volumes rose significantly in the first half of the year with growth in indices and solid issuance activity
In the first half of 2024, in the midst of the war, the TA-125 index increased by 3.5%, compared to the 3.8% for the Dow Jones index and compared 14.5% for the S&P 500 index. Equity price rises characterized most sectoral indices, with the TA-Retail index leading the list with a 13% increase, followed by the high-tech companies’ indices - TA-Technology and TA-Global Bluetech, with a 10% and 9% increase, respectively, compared to the concurrent 17% increase in the NASDAQ 100 index. The market cap of the equity market at the end of the first half of the year reached NIS 1,087 billion, a 3% increase over 2023.
Trading volumes in the main trading channels increased significantly in the first half of the year compared to 2023.
In the equity market, trading volumes were 8% higher than the average daily trading volume for all of 2023, and averaged NIS 2.1 billion a day.
The average daily trading volume of bonds reached NIS 4.5 billion in the first half of the year, 15% higher than the average daily trading volume in the year 2023. This increase was driven mainly by the increase in the trading volume of the government shekel bonds, which totaled NIS 2.3 billion, compared to an average of NIS 1.9 billion in the previous year. CPI-linked government bonds also showed stronger trading volumes, at an average daily volume of NIS 1 billion, 1% greater than the average daily trading volume in the full year 2023. The trading volume of corporate bonds averaged NIS 1.1 billion, 12% greater than the average daily trading volume in the previous year.
T-bills also recorded substantial trading volumes in the first half of the year, at a daily average of NIS 1.7 billion, 19% higher than the average daily trading volume in 2023.
Creations and redemptions of mutual funds reached an average daily volume of NIS 1.8 billion, 28% greater than the average daily volume in the year 2023. The market cap of the mutual funds at the end of the first half of the year reached NIS 375 billion, 14% greater than the market cap at the end of 2023, this as a result of acquisitions of mutual funds and the appreciation of the mutual funds’ assets on TASE.
In the first half of the year, 3 companies completed an IPO on TASE, compared to only one company in 2023.
Against the backdrop of the ongoing war and the growing deficit, the Ministry of Finance continued to raise debt in the second quarter of the year. The total amount of debt raised by the Ministry of Finance in bond offerings in the first half of the year totaled NIS 124.4 billion, compared to NIS 76.7 billion in the second half of 2023. NIS 95.7 billion of said amount was raised on TASE.
Continued implementation of the strategic plan - alignment with global standards and diversification of investment products
TASE continues to implement the strategic plan, with significant emphasis on the enhancement of global activity, the alignment of standards and the removal of trading barriers in the interfaces with the international markets.
Further to a call for public comments, published by TASE in collaboration with the Israel Securities Authority and the Bank of Israel, regarding the proposed transition to trading on Fridays as well, in line with the global standard, TASE announces that the proposed move received a very positive response from local and international investors, with a majority supporting a transition to a Monday through Friday trading week. TASE is currently considering options for the implementation of this alignment that would optimally benefit the local capital market and the international investors.
TASE continues to work in cooperation with the various authorities and regulators. Thus, for example, in mid-July, the Ministerial Legislation Committee approved the Securitization Law, which will facilitate, for the first time in Israel, the execution of securitization transactions, in alignment with global practices. Once the legislation is passed by the Knesset, TASE hopes to implement it and open the market already in 2025. In addition, the Israel Securities Authority has recently approved the launch of new money market funds with fixed dates, offering the public access to predetermined yield, this alongside the existing money market funds, allowing for greater product diversity for the benefit of the public.
TASE continues to actively encourage new brokers to enter the Israeli capital market - since the end of May, Altshuler Shaham Trade is active as a member on TASE and TASE Clearing House, bringing the number of TASE members up to 25, compared to 24 at the end of 2023.
In addition, TASE continues to expand and diversify the range of products and to invest, among others, in new exclusive indices, this as part of its strategy of developing and upgrading the market, especially with the public in mind. In June, for the first time, TASE launched new indices with Kesem, Israel’s largest fund company. In mid-July, TASE announced the launch of 7 additional equity and bond indices, some of which are designated for further collaborations between TASE and the various product issuers.
In the derivatives market, at the beginning of June, TASE reduced the multipliers of options on the TA-35 index, the TA-Banks5 index and the TA-125 index, as well as those of the foreign exchange derivatives traded on TASE. Part of the sources that will derive from the reduction of the underlying assets’ multipliers will be allocated to the development of the market and the enhancement of liquidity in the derivatives’ market by way of a volume rebate program.
Highlights of the results for the second quarter and the first half of 2024:
Revenue in the second quarter of 2024 totaled NIS 105.1 million, compared to revenue of NIS 92.9 million in the corresponding quarter last year, an increase of 13%. The increase in revenue is due mainly to an increase in revenue from data distribution and connectivity services, as a result of the increased volume of activity and the impact of the updated index-usage fees. The most significant revenue item - trading and clearing commissions - totaled NIS 38.8 million in the second quarter of the year, compared to NIS 35.5 million in the corresponding quarter last year. 15% of the increase in revenue from trading and clearing commissions is due to an increase in the trading volumes and in the volume of creations/redemptions of mutual fund units. In opposition, a reduction in the effective commission rate in revenue from mutual funds and T-bills reduced the aforesaid increase in revenue by 4%, and there being one less trading day in the current quarter reduced revenue by an additional 2%.
Costs in the second quarter of 2024 totaled NIS 74.8 million, compared to costs of NIS 72.6 million in the corresponding quarter last year, a 3% increase. The higher costs are due mainly to the increase in payroll expenses and technological investments and in computer and communication expenses.
Net financing income in the second quarter of 2024 totaled NIS 2 million, compared to net financing income of NIS 3.6 million in the corresponding quarter last year, a 45% decrease. Financing income in the quarter increased due to interest income on the deposits. At the same time, financing expenses also increased as a result of a bank loan obtained at the end of 2023, resulting in reduced net financing income.
Tax expenses, net in the second quarter of 2024 totaled NIS 8 million, compared to NIS 5.2 million in the corresponding quarter last year. The increase in the tax expense stemmed from the higher pre-tax profit. The increase in the effective tax rate is due to losses on securities in previous years for which deferred taxes were not created.
The profit in the second quarter of 2024 totaled NIS 24.3 million, compared to NIS 18.8 million in the corresponding quarter last year, an increase of 29%. The increase in profit was due mainly to the increase in revenue, less the increase in costs and in tax expenses, as described above.
The adjusted EBITDA in the second quarter of 2024 totaled NIS 45.8 million, compared to NIS 35.6 million in the corresponding quarter last year, an increase of 29%. Most of the increase is due to the NIS 10 million increase in profit before financing.
The adjusted profit in the second quarter of 2024 totaled NIS 25.7 million, compared to NIS 20.4 million in the corresponding quarter last year, an increase of 26%. Most of the increase is due to an increase in revenue from services, less the increase in costs and in tax expenses.
Highlights of the results for the first half of 2024:
Revenue in the first half of 2024 totaled NIS 213.4 million, compared to revenue of NIS 192.9 million in the corresponding period last year, an 11% increase. The increase in revenue is due mainly to an increase in revenue from data distribution and connectivity services, as a result of the increased volume of activity and the impact of the updated index-usage fees.
Costs in the first half of 2024 totaled NIS 150.1 million, compared to costs of NIS 142.6 million in the corresponding period last year, a 5% increase. The higher costs are due mainly to the increase in payroll expenses and technological investments and in computer and communication expenses.
Net financing income in the first half of 2024 totaled NIS 3.4 million, compared to net financing income of NIS 6.1 million in the corresponding period last year, a 44% decrease. Financing income in the period increased due to interest income on the deposits. At the same time, financing expenses also increased as a result of a bank loan obtained at the end of 2023, resulting in reduced net financing income.
Net tax expense in the first half of 2024 totaled NIS 16.7 million, compared to NIS 12.2 million in the corresponding period last year, a 37% increase. The increase in the tax expense stemmed from the higher pre-tax profit. The increase in the effective tax rate is due to losses on securities in previous years for which deferred taxes were not created.
The profit in the first half of 2024 totaled NIS 50 million, compared to NIS 44.3 million in the corresponding period last year, a 13% increase. Most of the increase in profit was due to the increase in revenue, less the increase in costs and in tax expenses, as described above.
The adjusted EBITDA in the first half of 2024 totaled NIS 94.4 million, compared to NIS 79.1 million in the corresponding period last year, a 19% increase. The increase is due to an increase of NIS 12.9 million in profit before financing, eliminating share-based payment expenses and depreciation expenses in an amount of NIS 2.4 million.
The adjusted profit in the first half of 2024 totaled NIS 53.5 million, compared to NIS 46.5 million in the corresponding period last year, a 15% increase. Most of the increase is due to an increase in revenue from services, less the increase in costs and in tax expenses and the adjustment of the increase in costs with respect to share-based payments.
Click here for the link to the full financial statements for the second quarter of 2024>
Click here for the link to the financial presentation of the second quarter of 2024>
This notification does not supersede that stated in the periodic financial statements of the Company, which contain the full and accurate information.
Seasonality
The revenue of the Company from trading and clearing is affected, inter alia, by the number of trading and clearing days. In the second quarter of 2024, there were 57 trading days, compared to 58 days in the corresponding quarter last year, a 1.7% decrease. In the first six months of 2024 there were 120 trading days, compared to 122 days in the corresponding period last year, a 1.6% decrease. Presented below is information on the quarterly breakdown of trading days:
|
Year |
First quarter |
Second quarter |
Third quarter |
Fourth quarter |
Total |
|
2023 |
64 |
58 |
61 |
66 |
249 |
|
2024 |
63 |
57 |
65 |
58 |
243 |
