WFE publishes 2012 Cost & Revenue Survey report

Author Name: 
WFE

2012 Cost and Revenue Key Conclusions

 

ð   For the first time since 2001, total revenues decreased (-10%) to USD 28 bn. All the types of exchanges and all the regions were affected.

-       Trading revenues from both cash and derivative markets declined following the drop in volumes.

ð   Total costs also decreased (-5%) but to a lesser extent.

ð   Profitability then decreased sharply:

-       Net income was down 25% at USD 9 billion

-       Average net profit margin was 32% (against 39% in 2011)

ð   Nevertheless this increase was partly due to exceptional items:

-       EBITDA decrease was less pronounced (-15%) than Net Income.

 

 

In 2012, the general environment was very unfavorable for exchanges worldwide:

-       Equity volumes decreased by 22% in USD and by 14% in number of trades;

-       For the first time since 2001, volumes also decreased sharply (-15%) on derivative markets (-19% for equity derivatives and -15% for Interest Rate derivatives)

In that context, trading revenues decreased sharply (-21% for cash markets and -14% for derivatives).

 

The activity on primary markets was also unfavorable. The total numbers of listed companies decreased by 0.2% and listing revenues were 1% down.

 

Financial income increased significantly (+15%) as well as revenues from “other services” (+5%). “Other services” include post-trade services for cash markets (+7.8%), market data revenues (+9.5%) and IT sales and services (+3.4%). Nevertheless, it was not sufficient to counterbalance the drop in trading revenues.

 

read the full report here