2Q 2016 FINANCIAL RESULTS AUGUST 2016 Financial results review - - PowerPoint PPT Presentation

2Q 2016 FINANCIAL RESULTS

AUGUST 2016

2

Financial results review

Key ey ev even ents s durin ing g the s e sec econd nd quarte ter

WWW.BVB.RO 21 June BVB publishes the White Book on communication of listed companies 16 June BVB and the Ministry of Communications and Information Society launch a project for entrepreneurs in IT 14 June Fru Fru / Good People bonds start trading on AeRO market 27 April Shares of Napoca start trading on BVB’s regulated market 27-28 May The 2nd edition of Your Money Expo takes place, attracting more than 6,000 visitors 7 June Warrants are launched. Out of 30 instruments, 18 have Romanian shares as underlying assets 13 June BVB launched IRIS, its new reporting system 22 June BVB and SIBEX announce the conclusion of a coordination agreement regarding a potential merger 1H 2016 New framework for short selling, lending&borrowins and trading on margin was developed and approved by market institutions (BVB, CSD, FSA) 1H 2016 Steps taken by the CSD towards the implementation of European market standards for corporate actions processing and T2S corporate actions standards

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Financial results review

Pres esen entatio ation n of B BVB Gr Group

• up and of t

the e consolida solidati tion n proces

• cess

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Bucharest Stock Exchange 100% free float Central Depository

69.04%

Bucharest Clearing House

52.5%

Investors Compensation Fund

62.3%

Corporate Governance Institute

100%

Bucharest Stock Exchange

100% free float

Central Depository

69.04%

Bucharest Clearing House

52.5%

Investors Compensa- tion Fund

62.45%

Corporate Governance Institute

100%

Entities included in the consolidation process Not included in the consolidation process

Segments within BVB Grou

• up:
• Tradin

ing g segment t – Bucharest Stock Exchange

• Post-tra

tradin ding g segment which includes:

• Clearing & settlement services of the Central Depository
• Activities of the Bucharest Clearing House
• Registry

try segment t – Registry activities of the Central Depository

• FCI servic

ices – Activities of the Investors Compensation Fund

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Financial results review

Key ey fi financi ncial h al high ighlig lights hts

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Financial performance, consolidated (RON mn, unless otherwise stated)

* The financial results for 2nd quarter and 1st half of 2015 are restated figures in accordance with IFRS and are not audited

1H 2016 1H 2015 Chan ange ge (%) 2Q 2016 2Q 2015* Chan ange ge (%) Operating revenues 14.16 14.92

• 5%

7.67 7.61 1% Operating expenses 12.92 13.62

• 5%

6.79 6.88

• 1%

Operating profit 1.24 1.30

• 4%

0.88 0.73 21% Net financial revenue/(expenses) 0.96 2.51

• 62%

1.21 0.71 69% Profit before tax 2.20 3.81

• 42%

2.09 1.44 45% Profit for the period 1.80 3.20

• 44%

1.76 1.24 41% Total comprehensive income 1.56 3.22

• 51%

1.72 1.24 38% EPS attributable to owners (RON/share) 0.2435 0.3986

• 39%

0.2320 0.1562 49%

Profitability ratios (%)

* Indicators based on consolidated financial results

1H 2016 1H 2015 2Q 2016 2Q 2015* Operating margin 9% 9% 12% 10% Net margin 13% 22% 23% 17% Return on equity (ROE) 2% 3% 2% 1%

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Financial results review

Analys lysis is of the c e consolida solidate ted res esults lts for the e quarte ter

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• BVB Group reported an improved financial performance during the second quarter of 2016, both at operating and bottom line levels,

recovering from a weaker start of the year. With operatin ting g revenues es slightly higher y-o-y to RON 7.7 mn, the consolidated operat atin ing g profit it for the quarter reached RON 0.9 mn, up by 21% compared to the second quarter of 2015. For the trading segment alone (represented by BVB’s operations), the operating profit marked a 45% y-o-y increase to RON 1 mn.

• Operat

atin ing g expenses es during 2Q 2016 declined by 1% y-o-y to RON 6.8 mn.

• Net finan

anci cial l revenues for the second quarter of 2016 had a positive contribution of RON 1.2 mn to the consolidated net profit, as changes in foreign currencies versus the RON became favorable, compared to the first three months of the year.

• The consolidat

lidated ed bottom line for Apr-Jun 2016 reached RON 1.8 mn, 41% above the year-ago period, generating most of the profit for the first six months of 2016.

* The financial results for 2nd quarter and 1st half of 2015 are restated figures in accordance with IFRS and are not audited 7.61 7.67 0.73 0.88 0.71 1.21 2Q 2015* 2Q 2016

Main financial indicators, 2Q 2016 vs. 2Q 2015 (RON mn)

Operating revenues Operating profit Net financial revenue/expenses 4.61 1.98 0.96 0.11 0.97

• 0.02

0.01

• 0.07

Trading Post-trading Registry FCI services

Distribution of operating revenues and result, by segment, 2Q 2016 (RON mn)

Operating revenues Operating result

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Financial results review

Analys lysis is of the t e tradin ing g seg egme ment t rev even enues ( ues (1/2 /2)

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• The trading segment represents the business of BVB
• Revenues from tradin

ding g fees were RON 3.67 mn during 2Q 2016 and accounted for 80% of the segment operating revenues, with a positive contribution of fees from the private placement of Romgaz shares, sold by Fondul Proprietatea.

• Issuers

rs fees reached RON 0.42 mn, down 27% compared to the year-ago period, based on a high-base effect created by

• ne-off fees paid by companies transferred from RASDAQ

market to the Regulated Market/AeRO.

• The data

ta vendin ing g business line generated RON 0.33 mn in revenues, up 7% y-o-y.

• More intense trading activity for the stock market during the

second quarter

• The improved shar

ares trading activity was due to higher average daily turnover (+3% y-o-y and +21% q-o-q) and to the ABB for Romgaz of RON 487 mn.

• Certif

tific icat ates es turnover declined by 11% y-o-y to RON 97 mn.

• The fixed-in

inco come market was lower in 2Q 2016 compared to the year-ago figure that included the EUR 500 mn public offer

• f Bucharest municipality bonds.

Trading segment revenues Trends in trading activity

* The financial results for 2nd quarter and 1st half of 2015 are restated figures in accordance with IFRS and are not audited Trading fees, 80% Issuers fees, 9% Data vending, 7% Other, 4%

Breakdown of trading segment revenues in 2Q 2016 (%)

4.33 4.61 0.67 0.97 2Q 2015* 2Q 2016

Operating revenues and profit, trading segment (RON mn)

Operating revenues Operating profit

31.3 32.2 33.1 26.6 32.2 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016

Average trading value, shares - regulated market (RON mn/day)

2.32 0.13 0.27 0.13 0.16 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016

Trading value, fixed-income instruments (RON bn)

0.11 0.11 0.08 0.14 0.10 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016

Trading value for certificates (RON bn)

1.99 2.18 2.69 1.80 2.57 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016

Trading value for shares, rights and units (RON bn)

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Financial results review

Analys lysis is of the t e tradin ing g seg egme ment t rev even enues ( ues (2/2 /2)

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29% 43% Note: Figures are presented on a “single counted” basis and include Deal trades (for stocks and structured products) and offers. Average trading value includes all equities markets, excluding offers

• 11%
• 29%
• 93%

26% 3% 21%

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Financial results review

Analys lysis is of the p e post t tradin ing a g and d reg egis istr try se y segme gment nt rev even enue ues

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• The post-trading segment includes settlement activities of the

Central Depository and, less significant for the Group financial standing, the activities of the Bucharest Clearing House

• Revenues for the segment marked a slight 1% y-o-y decrease

during 1H 2016, with a minor change in 2Q 2016

• Higher revenues for local settlement offset the decrease in

maintenance fees charged to participants to the clearing and settlements system and custodians

• The average monthly portfolio managed by custodians, the

basis for variable maintenance fees, declined by 10% y-o-y in 2Q 2016

• Revenues for the segment declined by 13% y-o-y in 2Q 2016
• The main reason was the lower amount of fees from services

rendered to issuers of financial instruments. Maintenance fees charged to issuers declined the most given the 34% lower number of companies having registries maintained by the Depository, after the closure of Rasdaq market

• Fees for services offered to owners of financial instruments

registered a small increase during the first half of 2016

Post-trading segment revenues Registry segment revenues

* The financial results for 2nd quarter and 1st half of 2015 are restated figures in accordance with IFRS and are not audited 1.11 0.96 0.07 0.01 2Q 2015* 2Q 2016

Operating revenues and profit, registry segment (RON mn)

Operating revenues Operating profit 2.03 1.98 0.03

• 0.02

2Q 2015* 2Q 2016

Operating revenues and profit, post-trading segment (RON mn)

Operating revenues Operating profit

3.82 3.80 0.52 0.61 2.54 2.38 2Q 2015* 2Q 2016

Breakdown of operating expenses, 2Q 2016 vs. 2Q 2015 (RON mn)

Personnel costs & Directors' fees Third party services Other operating expenses

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Financial results review

Analys lysis is of oper erati ting ng ex expen ense ses s for BVB Gr Group up

WWW.BVB.RO

• 1%
• Group operating expenses down 1% y-o-y in 2Q 2016. For full

1H 2016 operating expenses were reduced by 5% on strong variable costs management

• Personnel expenses stable in 2Q 2016, with a 3% y-o-y

increase in 1H 2016 on personnel turnover, variations in capitalized costs for in-house developed intangible assets and changes in remuneration of Board members (of BVB and CSD)

• Most cost savings in 1H 2016 achieved on third-party services

costs (-30% y-o-y) and other operating expenses (-10% y-o-y)

• Partnerships were signed for most projects, leading to lower

promotion costs in 2Q and 1H 2016 (in y-o-y terms)

* The financial results for 2nd quarter and 1st half of 2015 are restated figures in accordance with IFRS and are not audited Audit services, 16% Commissions & fees, 30% Promotion activities, 39% Other third party services, 15%

Third party services, 2Q 2016 (%)

Rent and office utilities, 23% Amortisation, 18% IT maintenance and service, 23% FSA fees and

• ther taxes, 11%

Other expenses, 24%

Other operating expenses, 2Q 2016 (%)

Consolidated financial position (RON mn)

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• Lower current assets and short-term liabilities, as the Central

Depository paid dividends to its clients

• BVB paid dividends of >RON 6 mn to its shareholders, further

reducing current assets

• 56% of short-term liabilities are dividends to be paid by the

Central Depository to its clients

• 30% of short-term liabilities are guarantee funds and margin
• Stable dividend policy, with a payout ratio of 100%, after legal

reserves

• The dividend policy is expected to remain unchanged

Note: Dividend yields are calculated using the price on the corresponding ex- dates, except for 2015, where the closing price as of 11 May 2016 was used

Financial results review

Over ervi view ew of t the e consolid solidate ated financi ncial l posit itio ion

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* The financial results for 2nd quarter and 1st half of 2015 are restated figures in accordance with IFRS and are not audited

Jun 2016 Dec 2015* Non-current assets 82.5 81.3 Current assets 87.7 98.3 Total assets ets 170.2 179.6 Shareholders’ equity attributable to

• wners of the Company

91.7 96.8 Minority interest 12.1 12.5 Short-term liabilities 66.4 70.3 Total equity ity and d liabili bilitie ties 170.2 179.6

2.14 1.12 1.18 1.46 0.87 8.2% 6.1% 4.4% 3.9% 3.5%

• 10.0%
• 8.0%
• 6.0%
• 4.0%
• 2.0%

2011 2012 2013 2014 2015

Gross dividends and dividend yields

Gross dividend/share (RON) Dividend yield (%)

THIS PRESENTATION WAS PREPARED BY BURSA DE VALORI BUCURESTI. THE INFORMATION CONTAINED IN THIS DOCUMENT HAS NOT BEEN INDEPENDENTLY VERIFIED AND NO REPRESENTATION OR WARRANTY EXPRESSED OR IMPLIED IS MADE AS TO, AND NO RELIANCE SHOULD BE PLACED ON THE FAIRNESS, ACCURACY, COMPLETENESS OR CORRECTNESS OF THIS INFORMATION. PAST PERFORMANCE IS NO GUARANTEE OF FUTURES RESULTS. THIS DOCUMENT DOES NOT CONSTITUTE AN OFFER OR INVITATION TO PURCHASE ANY SHARES. CERTAIN STATEMENTS CONTAINED IN THIS DOCUMENT MAY BE STATEMENTS OF FUTURE EXPECTATIONS AND OTHER FORWARD-LOOKING STATEMENTS THAT ARE BASED ON MANAGEMENT’S CURRENT VIEWS AND ASSUMPTIONS AND INVOLVE KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS, PERFORMANCE OR EVENTS TO DIFFER MATERIALLY FROM THOSE EXPRESSED OR IMPLIED IN SUCH STATEMENTS. EXCHANGE RATE USED FOR ADT IS THE DAILY EXHANGE RATE AS ANNOUNCED BY THE NBR. ACEASTA PREZENTARE A FOST REALIZATA DE BURSA DE VALORI BUCURESTI. INFORMATIILE CONTINUTE IN ACEASTA PREZENTARE NU AU FOST VERIFICATE DE CATRE O TERTA PARTE INDEPENDENTA, ASTFEL NU EXISTA NICIO GARANTIE SI NU TREBUIE LUATA CA ATARE ACURATETEA, CORECTITUDINEA SI COMPLETITUDINEA ACESTOR INFORMATII. PERFORMANÞA ANTERIOARA NU ESTE O GARANTIE A REZULTATELOR VIITOARE. ACEST DOCUMENT NU REPREZINTA O OFERTA DE A CUMPARA ACTIUNI. ANUMITE DECLARATII DIN ACEST DOCUMENT POT FI DECLARATII DESPRE ASTEPTARILE VIITOARE SAU ALTE EVOLUTII VIITOARE SI SE BAZEAZA PE VIZIUNEA SI IPOTEZELE ACTUALE ALE CONDUCERII COMPANIEI SI IMPLICA RISCURI CUNOSCUTE SI NECUNOSCUTE, PRECUM SI INCERTITUDINI CARE POT DETERMINA CA REZULTATELE EFECTIVE, PERFORMANÞA SAU EVENIMENTELE VIITOARE SA DIFERE SEMNIFICATIV DE CELE EXPRIMATE SAU INTELESE IN ACESTE DECLARATII.

BURSA DE VALORI BUCURESTI SA • Bulevardul Carol I nr. 34-36, Etaj 13-14, Sector 2, 020922, Bucuresti, Romania • Tel.: +40 21 307 95 00 • Fax: +40 21 307 95 19 Website: www.bvb.ro • E-mail: bvb@bvb.ro • Registrul Comertului: J40/12328/2005 • CUI: 17777754 • Capital social, integral subscris si varsat: 76.741.980 lei Decizia CNVM Nr. 369 / 31.01.2006

Thank you!

IR Contact act

Daniela Serban, Director IR & PR Anca Olteanu, CFA, Research Specialist Zuzanna Kurek, IR Specialist Email: ir@bvb.ro Phone: +40.21.307.95.00 Fax: +40.21.307.95.19

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