NZX reports FUM lift

2017 was a good year for NZX's funds management business.

Monday, February 19th 2018, 8:55AM

The share market operator has released its results for the 2017 financial year, ended December 31. Net profit was up 61.6% to $14.8 million.

Revenue in the funds management and wealth technology businesses, which include SuperLife, Smartshares ETFs and NZX Wealth Technologies grew 13.5% to $14.8m.

EBITDA increased 964% to $2.7 million driven by significant growth in FUM and the absence of compliance costs associated with the Financial Markets Conduct Act transition.

FUM in the SuperLife business grew 20.4% and membership numbers increased 4.8%. Total external Smartshares ETFs FUM increased 43.9% on 2016. The number of new ETF application was up 84% – of these applications 49% were first-time investors.

For the share market operator as a whole, operating expenses were down 11.6% on a like-for-like basis.

Full-year 2018 operating earnings are expected to be within a range of $28m to $31m.

NZX chief executive Mark Peterson said: “I am pleased to report a strong financial result for the exchange in 2017. It was underpinned by disciplined cost management, efficiency improvements, and a strong focus on our customers.

“Business highlights include the performance of our Smartshares Exchange Traded Funds business, which delivered double-digit growth and record retail application numbers, our dairy derivatives market, which presents an opportunity for sustained long term profitability for the exchange, and subscription and license growth in our data and insights business.

“2017 marked a fundamental reset of NZX as we refreshed our strategy to refocus on the core markets business. Public markets play a vital and active role in the New Zealand economy and it is important that we drive initiatives to support this. New Zealand’s capital market must have more investable product, greater participation, deeper liquidity, and a global presence.”

Wealth Technologies, a platform which enables advisers and brokers to manage client investments, is the newest addition to NZX. Platform development is expected to complete in the second quarter of this year and a large customer is expected to go live in the third.

Tags: NZX