Q1 2019 financial results

BVB BURSA DE VALORI BUCUREȘTI SA

 

FINANCIAL REPORT FOR 1Q 2019

The Bucharest Stock Exchange (BVB) saw all its indices post positive returns at the end of the first quarter amid domestic and international uncertainties. The BET index, which includes the most traded 16 listed equities, went up by 9 percent after the first three months, posting a closing value of 8,045 points at the end of the last trading session from March.  

On January 29, the shareholders of the Bucharest Stock Exchange approved during the Extraordinary General Meeting of Shareholders the establishment of the local Central Counterparty (CCP), to which BVB will contribute up to EUR 10 million.

The trading activity for all markets recorded a 24% decrease in the first quarter of 2019 compared to the first quarter of 2018, from RON 3.78 bn to RON 2.87 bn. The decrease is mainly attributable to the decrease of the offers on the main stock market, both of the initial public offerings and especially of the secondary public offers, from RON 865 mn in 1Q 2018 to RON 51 mn in 1Q 2019.

The regulated share market, excluding the initial and secondary public offerings, which generated 92% of total trading revenues in the first quarter of 2019 (1Q 2018: 70% of total trading revenues of BVB) remained stable, recording a similar traded value compared to the one recorded in the first quarter of 2018, respectively RON 2.64 bn.

Compared to the same period last year, the Central Depository's performance in the first quarter of 2019 declined with respect to local settlement operations, mainly due to the decrease in volumes traded on BVB and the drop in the managed portfolio (a decrease by 11% in 1Q 2019 compared with 1Q 2018 from RON 42.30 bn to RON 37.74 bn).

The operating revenues of the BVB Group recorded a decrease by 26% in the first three months of the year compared to the similar period of 2018, to a level of RON 8.86 mn (1Q 2018: RON 11.90 mn), decrease mainly driven by the decrease in the total value of transactions on the BVB markets.

The consolidated operating expenses amounted to RON 7.24 mn, recording an increase of 1.6% compared to the first three months of the previous year (1Q 2018: RON 7.13 mn), mainly due to the increase in depreciation and amortization expense and the expenses invoiced by suppliers in Euro equivalent, the national currency depreciating by 1.7% against the euro in 1Q 2019 compared to 1Q 2018.

The BVB Group recorded a 66% decrease in consolidated operating profit in the first quarter of 2019 to the value of RON 1.62 mn (1Q 2018: RON 4.77 mn), due to the decrease of the trading and post-trading segments.

The net financial income rose seven times in the first quarter of 2019 compared to the same period of 2018 up to RON 1.69 mn (1Q 2018: RON 0.21 mn), unrealized exchange rate differences resulting from the revaluation of financial instruments in foreign currency generating a gain of RON 0.96 mn (1Q 2018: loss of RON 0.46 mn).

The consolidated net profit in the first quarter of 2019 reached the level of RON 2.72 mn (1Q 2018: RON 4.03 mn), down by 32% compared to the previous year, 83% being generated by the Group's trading segment. The profit attributable to the shareholders of the parent company was of RON 2.73 mn (1Q 2018: 3.98 mn lei).

The General Shareholders' Meeting held on April 24, 2019 approved the distribution of the statutory net profit for the year 2018 of the Bucharest Stock Exchange in the amount of 9,490,411 lei, namely: 468,880 lei for the legal reserve and 9,021,531 lei in the form of gross dividends.

 

Financial and operating highlights

 

Consolidated financial performance – BVB Group (RON mn, unless otherwise stated)

 

 

 

 

 

 

1Q 2019

1Q 2018

Change (%)

 

 

 

 

 

 

 

 

 

Operating revenue

 

 

 

 

 

8.86

11.90

-26%

Operating expenses

 

 

 

 

 

(7.24)

(7.13)

1.6%

Operating profit

 

 

 

 

 

1.62

4.77

-66%

Net financial revenue/(expenses)

 

 

 

 

 

1.69

0.21

697%

Profit before tax

 

 

 

 

 

3.31

4.98

-34%

Profit from continuing operations

 

 

 

 

 

2.76

4.18

-34%

Profit from discontinued operation

 

 

 

 

 

(0.04)

(0.15)

-75%

Profit for the period 

 

 

 

 

 

2.72

4.03

-32%

Total comprehensive income

 

 

 

 

 

2.72

4.03

-32%

EPS attributable to owners (RON/share)

0.3254

0.4941

-34%

 

 

Profitability ratios (%)

 

 

 

 

 

 

1Q 2019

1Q 2018

Change (%)

 

 

 

 

 

 

 

 

 

Operating margin

 

 

 

 

 

18%

40%

-

Net margin

 

 

 

 

 

31%

34%

-

Return on equity

 

 

 

 

 

2.2%

3.2%

-

* Indicators based on consolidated financial results

 

Individual financial performance – BVB only, (RON mn, unless otherwise stated), including intra-group transactions

 

 

 

 

 

 

1Q 2019

1Q 2018

Change (%)

 

 

 

 

 

 

 

 

 

Operating revenue

 

 

 

 

 

5.38

8.21

-34%

Operating expenses

 

 

 

 

 

 (4.01)

  (3.82)

+5%

Operating profit

 

 

 

 

 

1.37

4.39

-69%

Net financial revenue/(expenses)

 

 

 

 

 

1.43

0.16

768%

Profit before tax

 

 

 

 

 

2.80

4.44

-37%

Profit for the period

 

 

 

 

 

2.34

3.72

-37%

 

 

Operating highlights, trading segment (RON mn, all markets)

Trading value

 

 

 

 

 

1Q 2019

1Q 2018

Change (%)

 

 

 

 

 

 

 

 

 

Shares, units, rights*

 

 

 

 

 

2,766

3,563

-22%

Certificates

 

 

 

 

 

37

88

-57%

Fixed-income*

 

 

 

 

 

61

129

-52%

Total

 

 

 

 

 

2,864

3,780

-24%

Avg. daily value (shares, excluding offers)**

 

 

 

 

 

44.15

53.68

-18%

Avg. daily value (shares, including offers)**

 

 

 

 

 

44.15

56.68

-22%

*Including offers  **Value for the Regulated market

 

 

 Operating indicators, post-trading and registry segments

 

1Q 2019

1Q 2018

Change (%)

 

 

 

 

No. companies with registry contract at CD

902

907

-1%

No. procedures resulted from issuers’ corporate events

285

230

24%

Local settlement

 

 

 

Value of trades settled on net basis (RON bn)

6.71

8.84

-24%

Value of trades settled on gross basis (RON bn)

1.07

1.20

-11%

Settlements through T2S platform (euro)

 

 

 

Value of trades settled on gross basis (EUR mn)

1.21

2.01

-40%

 

 

Share statistics for BVB as parent company (RON, unless otherwise stated)

 

 

 

 

 

 

1Q 2019

1Q 2018

Change (%)

 

 

 

 

 

 

 

 

 

Closing price (e-o-p)

 

 

 

 

 

21.90

28.20

-22%

Weighted average price

 

 

 

 

 

22.45

28.54

-21%

High (intraday)

 

 

 

 

 

24.60

30.70

-20%

Low (intraday)

 

 

 

 

 

21.10

27.30

-23%

Total trading value (RON mn)

 

 

 

 

 

2.42

11.31

-79%

Average trading value (RON mn)

 

 

 

 

 

0.04

0.18

-78%

 

The complete version of the Financial Report as of March 31, 2019 shall be available for shareholders, investors and general public as of May 14, 2019, 8:30AM local time. The printed version shall be available at BVB’s headquarters, located in Bucharest, 34-36 Carol I Blvd, 14th floor, district 2, and the online version shall be available on our website www.bvb.ro, in the “Investor relations/Financial figures/Financial statements” section, at http://www.bvb.ro/InvestorRelations/FinancialFigures/FinancialReports.

The conference call for presenting the financial results as of March 31, 2019 shall take place on May 14, 2019, 16:00 local time. For joining the conference call, please contact us at [email protected].