2022-08-29 04:02Financial Performance - In the first half of 2022, the company's revenue and other income amounted to HKD 8.937 billion, a decrease of 18% compared to the record high in the first half of 2021[7]. - The net investment loss for the company was HKD 378 million, contrasting with a gain of HKD 428 million in the first half of 2021, primarily due to a net fair value loss of HKD 511 million from externally managed investment funds[7]. - The company's EBITDA profit margin was 72%, down 7% from the record high in the first half of 2021[8]. - Shareholders' profit attributable to the company was HKD 4.836 billion, a decrease of 27% compared to the record high in the first half of 2021[8]. - Total revenue for the first half of 2022 was HKD 9,278 million, a decrease of 11% compared to HKD 10,407 million in the same period of 2021[10]. - EBITDA for the first half of 2022 was HKD 6,394 million, down 26% from HKD 8,607 million in the first half of 2021[10]. - Shareholder profit attributable to the company for the first half of 2022 was HKD 4,836 million, a decline of 27% from HKD 6,610 million in the previous year[10]. - The company reported a decrease in trading fees and trading system usage fees to HKD 3,553 million, down 13.8% from HKD 4,124 million[110]. - The company reported a net profit of HKD 6,610 million for the period, compared to HKD 6,589 million in the previous year, marking a growth of 0.3%[115]. Trading Activity - The average daily trading amount decreased, leading to a reduction in trading and settlement fees, with core business revenue down 11% compared to the first half of 2021[7]. - Average daily trading value for the Hong Kong Stock Exchange was HKD 138.3 billion, a decrease of 27% compared to HKD 188.2 billion in the same period of 2021[11]. - The average daily trading value for the Stock Connect (Shanghai and Shenzhen) was RMB 103.9 billion, down 9% from RMB 114.4 billion in the previous year[11]. - The average daily trading volume of derivative products increased by 35%, reaching 705,000 contracts compared to 522,000 contracts in the previous year[11]. - The average daily trading value of ETFs increased by 59%, reaching HKD 97 billion[18]. - The average daily trading volume of the Hang Seng Tech Index futures reached 64,928 contracts in the first half of 2022, more than a sevenfold increase compared to the same period in 2021[37]. - The average daily trading volume of MSCI China A50 Connect (USD) index futures was 19,863 contracts, a 72% increase compared to the average daily trading volume from the launch date until the end of 2021[37]. Operating Expenses - Operating expenses increased by 11% compared to the first half of 2021, driven by higher employee and professional fees[8]. - The company reported a 14% increase in operating expenses, attributed to rising employee costs due to talent investment and recruitment[12]. - Operating expenses increased by 16% in the first half of 2022, reflecting higher costs allocated to the listing department[27]. - The company incurred a net cash outflow from investing activities of HKD 2,141 million, compared to a net inflow of HKD 94 million in the previous year[116]. - Employee costs for the six months ended June 30, 2022, totaled HKD 1,667 million, an increase from HKD 1,495 million in 2021, marking an 11.5% rise[128]. New Products and Innovations - The company launched several new products, including the first Metaverse-themed ETF and the first pure Hong Kong stock ESG ETF in early 2022[6]. - The company is focused on long-term business development and innovation, including the introduction of a new SPAC listing system and market optimization measures[3]. - The introduction of qualified ETFs into the Stock Connect program on July 4, 2022, marks a significant milestone in enhancing connectivity between Hong Kong and mainland China capital markets[19]. - New product launches included the first blockchain ETF, first metaverse-themed ETF, first carbon futures ETF, and first pure Hong Kong stock ESG ETF[19]. - The group is enhancing its technology capabilities to transition from an infrastructure-based company to a more customer-centric organization[20]. Market Conditions and Strategic Focus - The company continues to focus on building a leading market despite the challenging global financial environment[18]. - The company is committed to sustainable development and has partnered with the Guangzhou Carbon Emission Trading Center to explore opportunities in the carbon finance sector[19]. - The company aims to strengthen its position in the Greater Bay Area, leveraging cross-border trading initiatives to boost market participation[171]. - HKEX is committed to sustainability, with plans to introduce green financial products to support environmental initiatives[171]. Shareholder Information - The board declared an interim dividend of HKD 3.45 per share, payable in cash[19]. - The interim dividend declared on June 30, 2022, was HKD 3.45 per share, compared to HKD 4.69 per share in 2021, a reduction of 26.4%[133]. - The company has not purchased, sold, or redeemed any shares other than those acquired under the share award plan during the reporting period[98]. Financial Position and Assets - Total financial assets increased by 35% to HKD 463.68 billion as of June 30, 2022, compared to HKD 343.81 billion at the end of 2021[68]. - The company's cash and cash equivalents rose by 16% to HKD 209.50 billion as of June 30, 2022, compared to HKD 181.36 billion at the end of 2021[68]. - The total number of shares held for the share award plan as of June 30, 2022, was 2,299 thousand shares, with a corresponding capital of 861 million HKD[19]. - The total assets increased to HKD 513,046 million as of June 30, 2022, up from HKD 399,304 million at the end of 2021, representing a growth of 28.6%[112]. Regulatory and Compliance - The audit committee, along with external auditors, reviewed the unaudited condensed consolidated financial statements for the six months ended June 30, 2022[79]. - The company has adopted the Standard of Conduct as its code of ethics for directors in securities trading[89]. - HKEX has complied with all provisions of the Corporate Governance Code, except for the rotation of directors as per B.2.2[88].