Hellenic Exchanges – Results Q4/FY 2014): After today;s closing, estimates…

16.03.2015 12:09

Hellenic Exchanges (Results 4Q/FY 2014):

Hellenic Exchanges will release its FY/Q4 2014e group results on March 16, 2015, post market hours and host a conference call the same day at 18:30 (Athens Time), 16:30 (London), 11:30 (New York).

 MANOS CHATZIDAKIS

Key points:

 

We see 2014e group sales, EBITDA and net profit down 43%, 53% and 31% y-o-y to EUR47.8m, EUR28.2m and EUR22.2m, respectively.  This 2014 earnings downtrend mirrors a massive drop in non-transactions revenues (-66% y-o-y to EUR20.6m), which more than offsets upbeat equity business (+51% y-o-y to EUR20.7m) as average daily turnover (ADT) jumped 61% y-o-y to EUR127m from EUR79m in 2013.

 

Recall that 2013 revenue were boosted by:

¡  Rights issues fees of EUR30.7m linked to Greek banks unusually high capital raisings (first recap phase)

¡  Off-exchange settlement income of EUR10.8m (CC Hellenic relisting).

 

More specifically:

¡  In Q4, group sales should fall 12% y-o-y to EUR11.7m, driven by a 19% drop in equity business to EUR4.6m. This, in turn, reflects a 20% decline in ADT to EUR110m on the back of less favorable y-o-y comparisons. That said, ASE trading activity picked up momentum in 4Q13, averaging EUR138m per day, 110% above 9M13 levels of EUR66m. As such, Q4 2014 cash market (trading/clearing) income should make up 40% of group total (vs 44% in 9M14 and 17% in FY13). Reversing previous quarter’s negative trend, Q4 derivatives revenue should advance 15% y-o-y to EUR1.2m (-4% y-o-y in 9M14), contributing 11% of group total. In the same vein, we look for a growth of 22% y-o-y to EUR1.5m in depository services income.

¡  On the flip side, we expect Q4 exchange services (rights issues fees, membership subscriptions, IPOs) and settlements revenue to fall 41% and 42% y-o-y to EUR1.1m and EUR0.5m, respectively, making up 10% and 4% of Q4 total.  In turn, depository, market data (data feed), revenue from re-invoiced expenses, X-Net, clearinghouse and IT services should represent 13%, 8%, 3%, 2%, 1% and 1% of Q4 total, on our estimates.

¡  We forecast Q4 total operating expenses up 3% y-o-y to EUR4.6m, but down 9% y-o-y on a recurring basis thanks to a 6% drop in staff costs to EUR2.5m (53.1% of group opex).  Further down the P&L, Q4 2014 group recurring EBITDA is seen 16% y-o-y lower at EUR6.5m compared with EUR8.5m a year ago.

¡  Likewise, we expect group EBIT and EBT to decline 22% and 21% y-o-y to EUR6.1m and EUR7m (the latter aided by EUR0.9m net financial income), respectively.

¡  Finally, we look for Q4 group net earnings of EUR5m vs net losses of EUR8.2m over the same period last year. Note that Q4 2013 bottom-line was hit by EUR13m extra tax payment (19% on EUR69m tax free reserves).

¡  End-December 2014 net cash position should settle at EUR152m (c42% of market cap) vs EUR163m a year earlier.

 

Conference Call:

 

¡  GR 00800 4413 1378,

¡  UK 0800 953 0329,

¡  US +1 866 819 7111,

¡  Other international participants +44 1452 542 301

 

Hellenic Exchanges 2013 2014 Y-o-Y 2013 2014 Y-o-Y
EUR thous. FY FY (%) 4Q 4Q (%)
Sales 81.466 47.839 -41,3% 13.301 11.664 -12,3%
EBITDA 60.501 28.209 -53,4% 8.172 6.540 -20,0%
EBITDA Mrg 74,3%  59,0%  -1.530 bps  61,4%  56,1%  -537 bps 
Net Income 32.284 22.239 -31,1% -8.173 4.988 161,0%
Net Mrg 39,6%  46,5%  +686 bps  -61,4%  42,8%  n.a.

 





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