NZX forecasts steady earnings in 2023, revenue expansion

NZX sees steady or improved earnings this year. Photo / File

Stock exchange operator NZX said it expects this year’s operating earnings to be steady, or an improvement on 2022′s.

At its annual meeting, chairman James Miller said the NZX’s operating earnings (EBITDA), excluding acquisition and integration costs, were expected to be in the range of $36.0m to $40.5m this year compared to $36.6m in the previous year.

“In the year ahead, NZX is focused on rounding out our product offering in capital markets in line with other international exchanges,” Miller said.

“Driving scale and operating leverage across the broader business to increase revenue base will also be a priority,” he said.

“We know our product offering could be expanded which is key to driving further growth in capital markets activity and greater global connections.”

Miller said NZX’s Smartshares, Wealth Technologies, the international partnerships with Fonterra and European Energy Exchange in Global Dairy Trade, the SGX Group in dairy derivatives, alongside its growing information services business, the Emissions Trading Scheme and carbon auction, were all adding value to its core markets business.

Smartshares, NZX’s exchange-traded-funds business, had grown with a diversified client base, smart acquisitions and achieving default status as a KiwiSaver provider.

“Funds under Management that were circa $1.7 billion when I became chair (in 2015) are now $10.3 billion.”

Miller said he expected Smartshares to lead the passive market in New Zealand in the years to come.

“Given the KiwiSaver market is around $96 billion, and most global markets have approximately 20 per cent allocated to passive, the business has a clear path to grow to $20 billion without factoring in industry growth factors,” he said.

“This is exciting for NZX and New Zealand’s capital markets and gives us greater control of our destiny.”