(Photo by Zahid Izzani/The Edge)

KUALA LUMPUR (Oct 30): Stock exchange operator Bursa Malaysia Bhd (KL:BURSA) reported its highest quarterly net profit in three years, thanks to higher income across its business segments, including the securities and derivatives market.

Net profit for the three months ended Sept 30, 2024 (3QFY2024) surged 41.93% year-on-year to RM85.74 million, Bursa Malaysia’s bourse filing on Wednesday showed. Revenue for the quarter climbed 33.11% to RM211.26 million — also the highest in three years — from a year earlier.

“The exchange is optimistic about meeting all five headline key performance indicators, including the profit before tax target that had been revised upwards in July 2024,” Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift said.

Bursa Malaysia did not declare any dividend during the quarter under review.

All in all, net profit for the first nine months (9MFY2024) totalled RM241.28 million, up 25.09% from RM192.83 million, while revenue rose 30.14% to RM598.39 million, from RM459.80 million in 9MFY2023.

This was attributed to a 39.1% surge in operating revenue from the securities market to RM411.8 million, despite higher overall operating expenses by 30.4% to RM273.4 million due to higher staff costs, IT maintenance, as well as service fees.

The group’s 9MFY2024 profit before tax and zakat stood at RM324.67 million, which represents 89.9% of the lower range of its revised target of RM361 million to RM379 million for the entire FY2024.

“The exchange is optimistic about meeting all five headline key performance indicators (KPIs), including the profit-before-tax (PBT) target that had been revised upwards in July 2024,” Muhamad Umar said.

Prior to the July revision, Bursa had targeted a PBT of RM293 million to RM323 million, while keeping its non-trading revenue growth target at 5%-7%.

Among other non-financial targets, the company is also aiming to host 42 initial public offerings (IPOs), with RM13 billion in total market capitalisation.

During the nine-month period under review, Bursa Malaysia’s trading revenue from its securities market surged 52.9% to RM300.3 million, compared to RM196.4 million in the same period last year.

This was attributed to a higher average daily trading value in the Securities Market’s on-market trades (OMT) and direct business transactions (DBT).

Trading velocity — a metric indicating market turnover relative to total market capitalisation — also improved by 13 percentage points to 42% in 9MFY2024, up from 29% in 9MFY2023, it said.

In its derivatives market, trading revenue rose 19.8% to RM80.8 million, from RM67.5 million in 9MFY2023, driven by a rise in crude palm oil futures (FCPO) and FTSE Bursa Malaysia KLCI Futures (FKLI) contracts, alongside the longer trading days during the period.

Meanwhile, in the Islamic market, operating revenue registered a modest 1.2% growth to RM13.0 million in 9MFY2024, from RM12.9 million a year ago, buoyed by revenue from the newly introduced Bursa Gold Dinar product.

In its data business segment, revenue climbed 16.3% to RM59.4 million in 9MFY2024, up from RM51.1 million a year ago, due to an expanding subscriber base.

On other developments, Bursa Malaysia said it will launch the world’s first waqf-featured exchange-traded fund (ETF) in 4QCY2024, aimed at enabling investors to support social and community initiatives.

“We remain committed to diversifying fundraising and trading opportunities for our valued stakeholders,” Muhamad Umar said.

This includes expanding product offerings by reintroducing single stock futures and incorporating renewable energy certificates into the Bursa Carbon Exchange, he noted.

“As a multi-asset exchange, we are dedicated to democratising access and providing more opportunities for all stakeholders,” he added.

“Domestic retail investors play a crucial role in driving our marketplace forward, and we will continue our outreach through initiatives like the Bursa Marketplace Fair and the Invest Malaysia series,” he added.

Shares in Bursa Malaysia were up 0.34% or three sen at RM8.94 at noon on Wednesday, giving the company a market capitalisation of RM7.24 billion. Year-to-date, the stock has gained over 29%.