ISE reports 35% increase in pre-tax profits for 2012
- Pre-tax profits rise to €6.3m (2011: €4.6m)
- Primary markets remains main contributor to ISE revenues at €13.2m
- Irish market revenue increases by 3%
The ISE has reported pre-tax profits of €6.3m for 2012, a 35% increase on 2011.
Revenues fell slightly by 4% to €20.4m in 2012 (2011: €21.3m). Primary markets business (from listing international funds, debt and equity securities), representing 65% of the ISE’s income in 2012, reduced by 3% to €13.2m (2011: €13.7m). The primary source of this revenue is international fund and debt issuers, with over 4,000 issuers from 49 countries listing their securities on the ISE at the end of December 2012.
The reduction in income reflected the global economic uncertainty which has affected the level of product issuance in recent years, particularly in relation to investment funds. However there has been some uplift in activity in recent months and we believe that revenues from our primary markets business will grow in 2013.
Traded markets business (from admission to trading income, membership fees, IT services and information products), representing 35% of ISE revenue in 2012, increased by €230k (+3%) to €7.1m (2011:€6.9m). The increase can mainly be attributed to additional sales of equity and bond market data.
While operating costs were reduced by €2.6m to €15.3m in 2012, this can mainly be attributed to the renegotiation of infrastructure contracts which reduced costs. In addition, savings were generated from the winding up of the Group’s defined benefit pension scheme in 2011.
The ISE’s income from financial investments was €1.2m during the year (2011: €1.3m).
ISE chief executive Deirdre Somers said the ISE delivered a strong performance in 2012, against a backdrop of historically difficult markets, as revenues remained resilient and good progress was made on managing costs.
"The economic environment remains challenging but we dealt with our challenges well during 2012,” said Ms Somers. “We remain focused on diversifying our income streams across our business lines and geographically. In the year ahead, we see increased activity in international fixed income and we are also looking at opportunities to develop new and innovative sources of income.”
She added: “The Irish market remains an important part of the ISE’s business and we are committed to delivering to Irish enterprise, to our listed companies and to enabling enterprising Irish companies raise finance on international capital markets.
The renewal of our contract with Deutsche Börse, which provides a world-class, globally-connected trading system in ISE Xetra, is part of this commitment and facilitates international trading and investment in Irish companies.
However the ISE is just one element of an ecosystem that supports Irish enterprise. We believe there is much more that Ireland - and in particular policy makers - can do to ensure dynamic Irish companies achieve scale. We look forward to contributing to the Action Plan for Jobs and the initiatives proposed to encourage domestic business achieve scale using the IPO route as an alternative to trade sale.”
The ISE is progressing changes to its corporate structure. These changes will result in the formation of a new company, limited by shares, which will replace the existing corporate structure of the ISE, which is a company limited by guarantee. This corporate re-structuring has no impact on the ISE’s operations or its existing business lines. While these changes are expected to take place this year, they remain subject to regulatory and other approvals.