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- Revenue in the first quarter 2009 totalled €72.7 million, down 27% from the same period a year earlier.
- Significant cost control, with growth of 1.7% in the first quarter.
- The efficiency ratio at the end of the first quarter stood at 33.7%, a benchmark for the market and the industry.
Bolsas y Mercados Españoles posted a net profit of €3.5 million in the first quarter 2009 - or €.40 per share - a 39.5% drop from the same period a year earlier, which was BME´s best-ever quarter in terms of profit and activity. This solid performance was underpinned by business units that generate revenues not directly linked to volumes. The ratio of the operating-cost base covered by this kind of revenues reached 107% for this quarter.
Trading volumes and financial flows through BME were significantly affected by a widespread correction in share prices and the severe uncertainty gripping markets, which damped investor activity and diminished access of capital markets as a source of financing.
Control over costs, which grew 1.7% year on year, and a diversified business model helped curb the decline in revenues of the units directly linked to trading volumes. Revenues in the first quarter 2009 amounted to €2.7 million (-27%), while EBITDA stood at €8.3 million (-36.1%).The company continues to maintain the highest standards of solvency and liquidity, which is especially important in the current context.
In the first quarter 2009, the evolution of the efficiency ratio, which values the expenses incurred at each revenue source, was similar to that of the company’s business areas. The efficiency ratio in the first quarter of 2008 stood at 24.2%, compared to 33.7% at the end of March 2009. The control over operating costs, especially in the current juncture marked by difficult conditions, makes it a benchmark for the industry and the market.
EQUITIES
In the first quarter 2009 the number of trades executed, including shares, exchange-traded funds and warrants, totalled 7.5 million, down 27.1% from the same period in 2008. The 27.12 billion shares that changed hands in the first quarter 2009 represented a 17.6% decrease from the same period a year earlier.
Revenues from the equity business unit in the first quarter 2009 fell 37.3% from a year earlier, to €8.7 million. EBITDA for the same period was €0.1 million (-45.6%).
CLEARING AND SETTLEMENT
Nominal amounts for all three markets in the first quarter 2009 increased 12.6% to €1.4 trillion. The number of trades settled in the first quarter 2009, including equities, public and private fixed income, totalled 8 million, down 27.8% from the same period a year earlier.
In the first quarter of 2009 revenue and EBITDA were lower than in 2008, at €16.04 (-33%) and €12.5 (-38%) million respectively.
LISTING
The capitalisation of the companies listed on the equity market stood at €727.26 billion at 31 March 2009, down 41.1% from the same year-earlier period. New issues on the AIAF Fixed Income market in the first quarter 2009 totalled €27.01 billion, a 4.3% increase compared to the same period a year earlier.
As a result of this mixed performance by the Equities and Corporate Fixed Income units, the Listing business ended the first quarter of 2009 with revenues of €.2 million, 0.4% lower than in the previous year. EBITDA for the quarter totalled €.5 million, down 0.8% from the same period a year earlier.
INFORMATION
The Information business area showed a mixed performance. On the one hand the number of clients connected to the information services provided by BME increased by 6.25% compared with 2008. On the other hand, average access to the different information sources in the first quarter 2009 was down 15.2% from the average in the same period in 2008.
As a result, the unit’s revenue in the first quarter came down by 5.3% from a year earlier to €.8 million. Cost control at this unit—costs were down 15.2% from the same period in 2008--helped EBITDA reach €.3 million at the end of the first quarter 2009, a 3% decrease compared to the same period in 2008.
DERIVATIVES
The volume of derivatives trading grew 39.9% in the first quarter of 2009, compared to the same period in 2008. Trading volume in IBEX 35®, contracts decreased in comparison with the same period in 2008, registering a fall of 16.5% for Mini Futures, 34.8% for IBEX 35®, futures and 45.6% for IBEX 35®, Options. Futures contracts on single stocks increased, by 52.9% in the case of futures and by 113.1% in the case of options.
The lower number of contracts on index products has impacted the unit’s performance. Revenues in the first quarter dropped 11.8% from 2008 to €.5 million. EBITDA for the same period was 25.8% lower than in 2008, at €.6 million.
FIXED INCOME
In the first quarter of 2009, trading in the Fixed Income business unit advanced 177% year on year to €1.04 trillion.
The switch from high-margin trading, to maturity, to low margin trading, simultaneous, means the unit’s revenues declined despite the increase in brokered volumes. As a result, the unit’s revenues declined 8.7% from a year earlier, to €.5 million. EBITDA in the quarter fell 9.4% year on year to €30,000 after deduction of operating costs, which fell 7.8% year on year.
IT & CONSULTING
Visual Trader increased its share of the orders it handles on the Spanish market, even though overall market conditions contributed to a 19% decrease in the total number of orders handled from a year earlier. In the first quarter 2009, the number of clients connected to Visual Trader was up 2.9% on the same period in 2008, boosted by the incorporation of five new financial firms that brought the total number of clients to 180.
There are ongoing consultancy projects in Ukraine and Colombia, while different stock exchanges operate with the SIBE electronic trading system.
HIGHLIGHTS
As regards shareholder remuneration, as of 29th January 2009, dividends totalling €2.1 million (equivalent to a gross of €.986 per share) were distributed, corresponding to the payment of the interim dividend against 2008 earnings. Among the proposals put forward by the Board of Directors for today’s Annual General Shareholders Meeting is the distribution of a final dividend similar to that paid out in January.
In April 2009 BME informed the CNMV that it had received confirmation from the Spanish tax authorities that it was entitled to a refund of €5.2 million, plus interest, for the 2004, 2005 and 2006 financial years. The accounting record of the revenue for the amount settled will be made in April.
In February BME launched a new platform for the trading of warrants and certificates in the Spanish electronic trading system, which provides greater capacity for managing the number of products admitted and greater speed of execution.
On 20 January, the first hedge fund company began trading on the Alternative Equity Market. The third segment of the Alternative Equity Market for Expanding Companies now has 20 Registered Advisors who will assess the suitability of companies and help them prepare their information.
BME has been awarded a project in Mexico to design a securities market for SMEs. It also has begun implementing its programme of tailored training courses, while continuing to develop different consultancy projects and continuity and MiFID-associated services for the investment community.
