KEY POINTS:
Exchange operator NZX said today its June half year net profit nearly doubled to $4.21 million despite having struggled in its traditional areas.
Market trading volumes were static with revenue similarly flat at $2.42m.
There have only been two initial public offerings (IPOs) this year but listing revenues still managed to grow 34 per cent to $4.30m, mainly driven by new debt and hybrid listings.
Chief executive Mark Weldon said the prospects for new listings were improved for the second half, with four companies having declared an interest, two of those "chunky sized".
He said NZX was aware of six or seven possibles of which it was confident four would come to market.
If 10 or more new companies listed it would be a good result.
He said the far more buoyant IPO market in Australia reflected 10 to 12 years of compulsory superannuation which created a lot of opportunities for companies to access capital.
Overall NZX earnings before interest, tax, depreciation and amortisation rose 102 per cent to $7.15m and operating revenue from 44 per cent to $15.05m.
Revenue from NZX's market information division rose 104 per cent to $4.79m and that would have been higher but for the high New Zealand dollar.
Operating expenses rose 19 per cent to $7.89m with costs associated with its new ECN trading operation in Australia, due to begin operations next quarter, a big factor in the rise.
Mr Weldon noted revenue was growing twice the pace of expenses.
The company expects to benefit next half from the introduction of the KiwiSaver pension scheme and related tax changes.
"NZX predicts a positive impact on trading volumes on the NZX markets. This will be felt initially in Q4 and grow over time."
NZX would continue to pursue acquisitions.
"AXE ECN shows that NZX has the ability to take our technological, market supervision, and strategic skills into new markets outside our domestic market.
"This will continue to be a focus of management, with NZX looking to carve out a footprint distinctive amongst exchanges."
Operating revenue for its Smartshares division rose 76 per cent to $1.58m. Smartshares finished the first half of 2007 with $592m under management.
NZX will pay a 16c imputed interim dividend. Last year, no half year dividend was paid. Instead a capital repayment of $16.2m, equating to $1.21 a share was paid.
NZX shares rose 20 cents to $11.70 after the result. The shares have soared from $6.00 a year ago to $11.50 yesterday.
- NZPA
