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Figure 1: ASX Limited 12 month chart


ASX Limited’s profit improves following IPO activity

·         ASX Limited (ASX), which operates Australia’s primary stock exchange, posted a FY14 profit of $383.2m; in-line with consensus. Strong growth in the IPO (Initial Public Offering) market in both the 2Q and 4Q helped lift earnings most. Both its profit and revenue were records for ASX

·         All six of its major operating divisions posted improvements in revenue. Income from its Cash Market unit rose slightly to $117.3m. Equity trading volumes on the ASX remain stable although ~10% lighter than FY13. Revenue rose 5.2% to $207.7m in its Derivatives & OTC Markets unit (biggest contributor)

·         Its Listing & Issuer Services unit however was the biggest improver thanks to IPO activity; revenue rose 10.9% to $154.9m. Over the year, 107 companies made their debuts on the local market, compared to 82 in FY13. The strong momentum continues this year, with $14.5bn raised via IPOs in July (best month this calendar year). The average initial listing fee for each new business on the market was $166,786 in FY14 & the average annual listing fee for those already listed was $28,333

·         ASX says it’s on track with infrastructure investments relating to its clearing operations. It plans on lowering fees for interest rate futures clearing participants in Oct. A $553m capital raising this year held back Earnings Per Share (EPS) growth. A fully franked $0.899/share 2H14 dividend was declared, payable to investors on 24 Sept. The ex-dividend date is 3 Sept. ASX has a 90% payout ratio and a 4.61% dividend yield

·         ASX shares rose following the result. The Australian Stock Exchange currently sits around 10th place on the world’s largest markets list and is valued at $1.5 trillion.


You can see all of CommSec’s reporting season analysis by clicking here.

Steven Daghlian, Market Analyst,