Moscow Exchange announces results for the third quarter of 2024

Moscow Exchange (MOEX) today announces its financial results based on summary financial statements prepared in accordance with International Financial Reporting Standards (IFRS) for Q3 2024.

Unless stated otherwise, all figures below refer to performance in Q3 2024 and all comparisons are with the corresponding period last year.

KEY FINANCIAL HIGHLIGHTS FOR Q3 2024

• Fee and commission (F&C) income amounted to RUB 14.86 bln.
• Net interest income (NII) was RUB 25.13 bln on the back of a high ruble interest rate environment.
• Operating income amounted to RUB 40.0 bln.
• Adjusted net profit was RUB 23.39 bln.

KEY BUSINESS & CORPORATE HIGHLIGHTS FOR Q3 2024

• Shares of three non-resource companies started trading following IPOs. These companies raised a total of RUB 18.1 bln. One issuer held SPO worth RUB 0.4 bln.
• The range of derivative contracts expanded with the launch of cash-settled futures contracts on cocoa beans as well as deliverable futures contracts on RASP shares.
• Six Russian-law ETFs on Russian equities, bonds and money market instruments began trading.
• Finuslugi clients are now able to screen, compare, analyse and purchase mutual funds on the platform.
• Moscow Exchange started calculating and publishing the IMOEX index nominated in CNY to make the Russian stock market more familiar and transparent for investors in the Asian region.
• Moscow Exchange opened a laboratory at the Moscow State Institute of International Relations (MGIMO) with access to MOEX Trade Info analytical terminal and courses of the Moscow Exchange School. The laboratory will be used for training sessions as well as scientific and analytical research.

EVENTS OCCURRING AFTER THE REPORTING PERIOD

• Another three companies from non-resource sectors did IPOs, raising a total of RUB 7.0 bln. One issuer held SPO worth RUB 1.5 bln.
• Number of equities available for trading in CCP-based OTC trading mode reached 135.
• Four cash-settled futures contracts on non-ferrous and industrial metals as well as perpetual futures contracts on SBER and GAZP shares were launched.
• The first-of-a-kind issue of digital financial assets (DFA) backed by a work of art was placed on MOEX platform.
• MOEX expanded the range of precious metals instruments and started trading in platinum and palladium.
• 34.2 million clients had brokerage accounts on MOEX at the end of October. Nearly 9 million clients have traded MOEX markets since the beginning of the year.
• Another seven Russian-law ETFs on Russian equities, bonds and money market instruments began trading on MOEX.

FINANCIAL HIGHLIGHTS (RUB million)

OPEX BREAKDOWN (RUB million)

• OPEX for 3Q’24 increased by 54.4%, largely due to the growth in marketing and personnel expenses.

• Personnel expenses grew by 34.4% due to new hires, selective wage revisions and other factors. LTIP had no contribution to YoY personnel expenses growth.

• The employee headcount was up 19.4% and 6.5% QoQ. New QoQ hires are primarily related to IT and Finuslugi.

• The 2.4x increase in taxes, other than income tax, is related to VAT.

• The 50.4% growth in agent fees reflects insurance sales on the Finuslugi platform.

• D&A and IT maintenance grew 30.0%, while the D&A added 21.8%. IT maintenance costs increased by 53.3%. The rise in IT maintenance costs is due to the gradual implementation of the software & hardware renewal program.

• 3Q’24 CAPEX was RUB 1.87 billion. 9M’24 CAPEX amounted to RUB 4.99 billion.

PERFORMANCE OF KEY BUSINESS LINES

• The total market capitalization of the Equities Market at the end of the third quarter of 2024 was RUB 53.61 trln. Fees from the Equities Market grew by 10.3% on the back of a similar increase in trading volumes, which gained 10.7%. Over 3.8 million clients were active every month during the quarter.

• Fees and commissions from the Bond Market grew 24.7% on the back of an increase in trading volumes (excluding overnight bonds) of 19.5%, which was largely driven by the elevated primary market activity. The effective fee improved due to a higher share of primary market in total trading volumes. Primary market trading volumes (excluding overnight bonds) went up 37.1%, while the secondary trading volumes increased by just 1.5%. The supply of floating-rate issues propped up the primary market. However, floating-rate bonds have a lower trading velocity in the secondary market compared to fixed-rate bonds. Secondary trading of OFZs was down 26.4%; other bonds’ volumes were up 39.6%.

• Money Market fee income improved by 18.1% while trading volumes added 28.5%. The discrepancy between fees and volumes was mainly attributable to the increase of less marginable non-CCP repo and deposit segments’ share in the volumes’ mix. The effective fee was also negatively affected by the decrease in average overall on-exchange repo terms. The GCC repo segment benefits from the rising demand for Russian-law money market ETFs. More than 1 million clients have already invested in Russian-law money market ETFs.

• Fee income from the Depository and Settlement Services was down 3.6%. Average value of assets under custody grew by 3.7%. The discrepancy between growth rates of fee income and assets on deposit is the result of business lines beyond safekeeping, primarily clearing and collateral management services, which reflect repo operations at the NSD. These two lines demonstrated negative performance, which was only partially compensated by the increase in safekeeping fee income.

• Derivatives Market fees grew by 16.6%, trading volumes barely changed, adding just 0.9%. The volumes’ mix changed towards higher value-added derivative contracts on commodities and equities, which had a positive effect on the effective fee. Specifically, commodity derivatives’ volumes surged by 85.2%. The volumes of single-stock contracts improved by 28.1%. On the other hand, FX derivative contracts decreased by 31.8% in trading volumes.

• Information sales decreased by 42.1%. Sales of software and technical services were up by 10.6% because of a rise in demand for these products. Listing and other services increased by 23.2% as activity on the primary bond and equities markets remained strong during the quarter. Finuslugi revenues improved by 71.1% to RUB 780.7 mln with deposit segment performing particularly well. Other fee income grew by 121.8% on the back of the NCC tariff model update related to precious metals market as well as launch of new products.

• The cash position[3] at the end of Q3 2024 was RUB 127.04 bln. The company had no debt as of the end of the quarter.

• Capex for the quarter was RUB 1.87 bln, mostly spent on purchases of software and equipment as well as software development.

Moscow Exchange’s summary consolidated IFRS financial statements for Q3 2024 are available in the Investor Relations section of the company's web site.

Contacts:
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NOTES TO EDITORS

About Moscow Exchange

Moscow Exchange Group operates Russia’s main trading platform for equities, bonds, derivative instruments, currencies, money market instruments and commodities. The Group includes the central securities depository (National Settlement Depository), and a clearing centre (National Clearing Centre), performing the functions of central counterparty on the markets, which allows Moscow Exchange to offer its clients the full spectrum of trading and post-trading services. Moscow Exchange held the initial public offering of its shares on 15 February 2013 (ticker MOEX).

Disclaimers

Some of the information in these materials may contain projections or other forward-looking statements regarding future events or the future financial performance of the Company. You can identify forward looking statements by terms such as "expect", "believe", "anticipate", "estimate", "intend", "will", "could", "may" or "might" the negative of such terms or other similar expressions. The Company wishes to caution you that these statements are only predictions and that actual events or results may differ materially. The Company does not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of the Company, including, among others, general economic conditions, the competitive environment, risks associated with operating in the Russian Federation, rapid technological and market change in the industries the Company operates in, as well as many other risks specifically related to the Company and its operations.