Exchange books profit jump

A profitable year for Simon Allen (left) and Mark Weldon. Picture / Brett Phibbs

Slowing growth economically and on the main board did not stop sharemarket operator NZX's full-year profit climbing a third to $4.9 million.

Revenue was up 19 per cent to $19.55 million, and earnings before interest, tax, depreciation and amortisation (ebitda) were up 46 per cent to $6.5 million. However, excluding non-recurring items and asset revaluations, operating earnings were up 23 per cent to $7.2 million.

Over the period, trade on the NZSX's markets rose 16 per cent to $29.4 billion and the NZSX-50 sharemarket index rose 10 per cent. The NZSX's capitalisation was unchanged.

NZX chairman Simon Allen said the strength of the result in the face of mixed markets "demonstrates the intrinsic value of NZX as a business, its value to shareholders and its resilience to changes in market conditions".

Chief executive Mark Weldon said the result showed the company's financial performance was largely independent of short-term market sentiment.

"Where previously NZX had been heavily reliant on new listings and index performance, we now have sustainable, independent and solid results."

Increasing certainty over its financial performance and cashflow meant NZX had decided to adopt a dividend policy of paying out 60 per cent of net profit.

That would see it pay a fully imputed final dividend of 25c.

NZX said it would return a further $16.2 million of capital to shareholders in a pro rata share buyback which would be followed by a one-for-one share split, doubling the number of shares on issue.

The dividend and return of capital together represent a total capital return of $19.4 million.

Investors welcomed the result, bidding the company's shares 60c higher to close at $7.50 yesterday.

Weldon said NZX's newer revenue streams, its Smartshares and Link businesses had reached break-even during the year and would make positive contributions to future cashflow.