PSE 2017 net income up by 18% to P825 million

February 5, 2018

The Philippine Stock Exchange, Inc. (PSE) posted a net income of P825 million for the full-year 2017, an increase of 18 percent from the P702 million net profits posted in 2016 based on the Exchange’s unaudited consolidated financial statements

In a statement Monday, operating revenues and other income in 2017 increased by 10 percent to P1.63 billion from P1.48 billion the previous year.  Revenues were supported by higher trading activity, stronger market data income and the gain on sale of PSE’s Tektite Office.

For 2017, average daily turnover increased by more than 3 percent to P8.06 billion compared to P7.81 billion in 2016.  Subscription fees and market data income on the other hand increased by 26 percent as a result of more investors using the online trading service of the Exchange and the successful introduction of new data products.

Operating income went down by three percent in 2017 compared to 2016 due to lower listing-related income from IPO’s.  Management was able to reduce total expenses to P596 million in 2017, almost 2 percent lower than the previous year.

“The Exchange’s successful execution of its major initiatives in 2017 resulted in this positive financial performance of the Company.  The new products and services that were introduced provided more mechanisms for capital raising and supported our thrust of expanding the retail investor base,” PSE President and CEO Ramon Monzon explained.

In 2017, there were three issuances that used the new dollar denominated facility of the Exchange, which together raised $370 million while new rules for the listing of Public-Private Partnership Projects were also launched.  In December, the guidelines for short selling were submitted to the Securities and Exchange Commission (SEC) for their approval.

The PSE is on track with its scheduled stock rights offering which was undertaken to reduce the brokers’ ownership in the Exchange to the 20 percent limit mandated by the Securities Regulation Code.  The SEC has approved both PSE’s registration statement filing and listing application for this offering which has been scheduled for February 26 to March 2, 2018.

“We have set even bigger targets and milestones for the Exchange in 2018.  With our stock rights offering proceeding within schedule, we hope to finally get the exemptive relief from the SEC for our acquisition of PDS.  The consolidation of the equities and fixed income markets will result in a bigger and more efficient capital markets for the country,” Monzon added.

“We continue to pursue other initiatives for this year including the introduction of the name-on-central depository program, launch of the short selling facility, creation of new indices and the launch of structured warrants and derivative products.  Discussions with the SEC are on-going on many of these programs to ensure that we are able to provide the most suitable model for the Philippine market,” Mr. Monzon explained.

Name-on-central-depository or NOCD will allow investors the ability to monitor their shareholding positions that are lodged at the depository as they will receive directly from the depository monthly reports on their stock position and transactions every month.  The short selling and derivative products  will allow investors to hedge their market positions as they deem fit.

“We expect an increase in some expenses this year related to the integration of PDS into PSE as well as the one-time expenses related to PSE’s move to its new offices in BGC.  We are continuously studying how to restructure and rationalize the operations of PDS to enable us to realize the operating and cost synergies that can be had in this acquisition. We’re always looking for ways to improve our operating efficiencies and reduce our operating expenses,” Monzon added. DMS