Hong Kong stock exchange operator HKEX sees profit slip 13% as lower turnover, fewer listings weigh

The exchange operator’s net profit for the January-to-March came in at at HK$2.97 billion (US$380 million), or HK$2.35 per share

‘Despite a fragile global backdrop, the group’s derivatives and commodities business performed strongly,’ says CEO Bonnie Chan

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Total revenue in the first quarter declined 6 per cent to HK$5.2 billion, beating analysts’ estimates of HK$4.96 billion. Photo: Jelly Tse

Published: 12:25pm, 24 Apr 2024Updated: 7:43pm, 24 Apr 2024

Hong Kong Exchanges and Clearing (HKEX), which operates Asia’s third-largest stock market, reported a 13 per cent drop in profit for the first quarter as fewer new listings and lower turnover took a toll.

Net profit for the January-to-March period came in at HK$2.97 billion (US$380 million), or HK$2.35 per share, which was better than a consensus estimate compiled by Bloomberg for a 14 per cent decline to HK$2.79 billion.

The result represents the bourse’s best quarter in the past year, exceeding the fourth quarter of 2023 by 14 per cent, the third quarter by 1 per cent and the second quarter by 2.4 per cent. Total revenue in the first quarter declined 6 per cent to HK$5.2 billion, beating analysts’ estimates of HK$4.96 billion.

“HKEX demonstrated its strength and resilience in the first quarter of the year,” Bonnie Chan Yiting, its newly appointed CEO, said in a statement on Wednesday. “Despite a fragile global backdrop, the group’s derivatives and commodities business performed strongly – the former achieving record quarterly volumes.”

CEO Bonnie Chan speaks during an event at the exchange in Hong Kong on March 8, 2024. Photo: Bloomberg

The cash market reflected broader macro sentiment and remained soft, she said. Even so, there was a notable uptick in headline average daily turnover in March and April, indicating growing investor confidence, she added.