Highlights
- Pre and post tax profit of £2.6 million (2001: Loss £4.2 million)
- Key trading statistics for the period
- total turnover: € 328 billion
- total number of trades: 4 million - Details of first European-scale CCP for equity trading announced on 11 July 2002
- Over 2,800 traders now connected
- A daily average 9.3% of DJ Stoxx 600 for Q1 (9.7% for June 2002)
- Market share in the SMI now standing at 83% of total volumes traded in Europe
Commenting on the results, Antoinette Hunziker-Ebneter, CEO of virt-x plc, said:
"virt-x has produced a sound set of results for the first half of the year against the background of a difficult equity market environment. Since trading started in June last year, virt-x has increased its market share to 9.3% of the DJ Stoxx 600 for the second quarter of 2002. This satisfactory performance demonstrates that there is demand for a cross border blue chip exchange.""Looking forward we will continue to pursue our strategy of building the virt-x market organically by attracting new members and enhancing the efficiency and functionality of the market through initiatives such as the recently announced pan-European central counterparty, which is due to go live in March next year."
Overview
virt-x successfully launched the first comprehensive pan-European blue chip market on 25 June 2001 in response to demand from leading market participants. The virt-x model integrates trading, clearing and settlement and thereby allows firms to reduce greatly the costs of cross border trading.
Trading
During the period virt-x processed 4 million trades worth € 328 billion. The quality of the virt-x market is high with 98% of all trades executed on the public limit order book (72% by value). 99% of all trades were settled on intended settlement date.
For the second quarter of 2002, the overall market share of trading in the Dow Jones Stoxx 600, the broadest pan-European index, stood at an average of 9.3% (9.7% for June) compared with 7.9% in the first quarter of 2002. The market share in the narrower Dow Jones Stoxx 50 index was 14.3% in the second quarter compared with 12.2% in the first three months of this year.
Results
The pre and post tax profit for the six months to 30 June 2002 was £ 2.6 million, compared with a loss of £ 4.2 million reported for the six months to 30 September 2001. Detailed comparisons between the two periods are not meaningful as the period to 30 September 2001 comprised the last 3 months of Tradepoint and the first 3 months of operating the virt-x pan-European equity market. The trading loss, being the operating profit before forfeit of Limited Recourse Facility and goodwill, for the six months to 30 June 2002 was £ 0.5 million. This compares with a trading loss of £ 1.0 million reported for the first six months of operating the virt-x market (i.e. to 31 December 2001).
Outlook
Looking forward, the Board is convinced that virt-x has the right business model and as the only cross border exchange in Europe is well positioned to grow its business organically. virt-x's strategy is to grow its business, particularly in non-Swiss stocks, by exploring new and different connectivity options, enhancing operating procedures and streamlining the clearing and settlement arrangements. The delivery of the Central Counterparty next year will strengthen further virt-x's position.
