Bursa Malaysia's 4Q earnings up 21.5%, declares 14 sen dividend

KUALA LUMPUR (Jan 31): Bursa Malaysia Bhd reported a 21.5% year-on-year growth in net profit for the fourth quarter ended Dec 31, 2023 (4QFY2023), driven by trading revenue from the securities market amid higher average daily trading value (ADV). 

Net profit rose to RM59.55 million or 7.4 sen per share for 4QFY2023, from RM49.00 million or 6.1 sen per share a year ago. 

The group declared a final dividend of 14 sen. 

Revenue grew 7.5% to RM156.68 million for 4QFY2023, from RM145.70 million in 4QFY2022. 

Although full year FY2023 ADV for securities market’s on-market trades grew by a meagre 0.5% to RM2.1 billion, Bursa Malaysia’s net profit last year increased 11.4% to RM252.38 million from RM226.57 million in FY2022, thanks to lower operating expenses. 

Bursa Malaysia’s lower operating expenses were due to reversal of provision for sales and service tax (SST) made for the period Jan 1, 2020 to June 30, 2023. 

“The group had written to the Ministry of Finance (MOF) for clarification on the application of the SST on digital services, pursuant to Service Tax (Amendment)(No.2) Regulations 2019, which came into effect on Jan 1, 2020, on certain services provided by the group,” said Bursa Malaysia in a stock exchange filing on Wednesday. 

“The application also requested for exemption from the SST if the services are deemed as digital services. However, the MOF reverted that the services [have been] subjected to SST effective July 1, 2023, and confirmed that no retrospective SST is payable.

“Based on this decision, the group reversed the provision on SST made on the services for the period from Jan 1, 2020 to June 30, 2023,” it added.

The group’s revenue for FY2023 grew 2.2% to RM616.49 million, from RM603.25 million in FY2022. 

For FY2023, Bursa Malaysia said it had achieved all announced headline key performance indicators (KPIs) except for the number of initial public offerings (IPOs).

The stock exchange operator had targeted 39 IPOs for FY2023, but recorded 32 first-time share sales exercises instead, which it attributed to lower IPOs on the LEAP market. 

Commenting on its prospects, Bursa Malaysia said trading activities in the securities market will continue to be influenced by the ongoing global and local developments such as the monetary policy shifts in advanced economies, weaker-than-expected economic activity in China, the performance of the Malaysian ringgit, as well as corporate earnings.

Bursa expects its revenue and profitability to improve in 2024, setting KPI for profit before tax of RM293 million-RM323 million, and non-trading revenue growth of 5%-7%.

The group also targeted 42 IPOs in FY2024, with a total IPO market capitalisation of RM13 billion.

Bursa Malaysia said it is targeting to launch two new products, namely the Renewable Energy Certificates and the Centralised Sustainability Intelligence platform.

Read also:Bursa Malaysia’s target of 42 IPOs for 2024 is ‘realistic’, 24 already in pipeline