Bursa Malaysia Annual Report 2015

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FROM THE BOARD OF DIRECTORS AND SENIOR MANAGEMENT
32 Bursa Malaysia • Annual Report 2015
Securities trading revenue fell on a lower tradi ng participation by domestic
retail and i nstitutional investors, but was cushioned partia lly by higher
fo reign participat ion. Meanwhile, there wa s greater trading interest in
Crude Palm Oil Futures (“FCPO”) and FTSE Bursa Malaysia KLCI Futures
(“FKLI”) in the Derivatives Mark et where average daily contracts (“ADC ”)
rose 13% to 57,157 contracts owing to market volatility. B SAS similarly
saw greate r trading due ma inly to the conversion to Murabahah contracts
and growing interest in tenor-based pricing.
The ri se in contributions from our non-sec urities markets is a positive
sign that our effo rts to grow these business segments are wo rking, and
we are optimistic that they will continue to gro w their contributions going
forward.
OPERATING EXPENSES SHOW CONTROLLED RISE
Bursa Malays ia’s operating expenses ro se 3% to RM239.8 mil lion in 2015
due mainly to higher staff costs. We remain committed to a talent strategy
that will see us maintain the highest quality staff possible as part of our
plan to become a high perfor ming organisation (“HP O”).
We also paid higher service fees (+22% to RM22.4 million) in 2015
due to the greater number of derivativ es contracts traded and also the
comparatively weaker value of the Malaysian Ringgit against the US
Dollar. Meanwhile, we booked a lower depreciatio n and amortisation cost
in 2015 as we had retire d our Derivatives Order Management System
(“OMS”) in 2014. O ther expense items including professional fees,
administrative and miscellaneous expenses rose during the year as we
contin ued to increase the capa bilities of our marketplace.
REWARDIN G OUR SHAREHOLDERS
In view of our financial pe rformance and after taking into consideration
operating conditions ahead, Bursa Malaysia’s Board o f Directors has
re commended a final dividend of 18 sen per share to be approved at our
Annual General Meeting to be held in March 2016. If approved, the total
dividends paid by Bursa Malaysia in 2015 will amount to 34.5 sen per
share, representing a dividend yield of 4.1%.
SEGMENTAL PERFORMANCE HIGHLIGHTS
Contributions from our individual markets were mixed in 2015 owing
to volatile market conditions. Although trading in the Securities Market
had decreased during the year, increased activity in the Derivatives and
Islamic Capital Markets had more than made up the difference. The
increase in our non-securities trading revenue is further evidence of the
diversity of our market, as investors and market players can continue
to find value in alternative products and options even when the general
market is on the decline. The following table provides an overview of the
financial performance of our markets:
RM278.8
Profit Before Tax
57,157
ADC rose to
CEO’S MESSAGE
AND MANAGEMENT
DISCUSSION AND ANALYSIS
Segmental Review
2015
RM mil lion
2014
RM million % change
Segmental Profit/(Los s)
From:
Securities Market 28 5.7 294.3 -3%
Derivatives Market 51.2 40.8 +25%
Islamic Capital Market 11.8 5.4 +120%
Exchange Holding (8.9) (8.9) 0%
Total Segmental Profit 339.8 331.6 +2%
Overhe ads (61.0) (59.8) +2%
Profit Before Tax 27 8.8 271.8 +3%
million
contracts
13%