GuruFocus -
- Revenue: Over MXN1 billion, up 13% for the third quarter.
- EBITDA: MXN609 million, up 19%.
- Earnings Per Share: $0.73, up 27% year-over-year for the quarter.
- First Nine Months Revenue: Over MXN3 billion, up 4%.
- EBITDA Margin: 56% up to September.
- First Nine Months Earnings Per Share: MXN2.08, up 8% year-over-year.
- Equity Trading Revenue: Up 20% compared to the third quarter of last year.
- Average Daily Traded Value: MXN17 billion, up 24%.
- Clearing Revenue: Up 50%.
- Indeval Revenue: Up 27% due to increased assets under custody and cross-border transactions.
- Total Assets Under Custody: Increased 12% to MXN38 trillion.
- Operating Expenses: MXN1.5 billion for the first nine months, up 4%.
- Net Income: MXN410 million for the third quarter, reflecting a 24% growth.
- Capital Expenditure on Technology: MXN154 million up to September, up 14%.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Bolsa Mexicana de Valores SAB de CV (BOMXF) reported a strong financial performance in Q3 2024, with revenue exceeding MXN1 billion, up 13% year-over-year.
- Earnings per share increased by 27% compared to the same quarter last year, reflecting robust profitability.
- The company maintained a high EBITDA margin of 58% for the quarter, showcasing effective cost management.
- There was a significant increase in equity trading and clearing revenue, up 20% year-over-year, driven by a 24% rise in average daily traded value.
- The central securities depository, Indeval, saw a 27% increase in revenue due to higher assets under custody and favorable exchange rates.
- Bolsa Mexicana de Valores SAB de CV (BOMXF) anticipates a potential negative impact on revenues between MXN90 million to MXN110 million due to competitive pricing changes by a rival exchange.
- The company experienced a decrease in OTC trading and value-added services revenue by 3%, attributed to lower CO2 emissions compensations.
- Listing revenue decreased by 4% due to a lower number of long-term debt issuances and follow-on offerings.
- The information services segment saw a revenue decrease of 6% when excluding exchange rate impacts, due to product cancellations and portfolio management service withdrawals.
- The company faces challenges in maintaining market share amidst competitive pressures and regulatory changes, which may impact future revenue growth.
A: Alfredo R. Guillen Lara, Director of Capital Market Transaction Services, explained that Viva's new pricing structure includes changes to maker-taker tariffs, a commercial scheme favoring block trades and closing prices, and a liquidity supplier rebate structure. These changes are expected to impact Bolsa's revenues by approximately MXN90 million to MXN120 million annually, which could imply a discount more aggressive than Viva's 25%.
Q: What is the status of the new fixed income counterpart, and when is it expected to be operational?
A: Roberto Gonzalez Barrera, indicated that the approval for the fixed income counterpart is expected soon, with the system already in production. The project is anticipated to benefit Mexican banks by reducing risk-weighted assets and increasing capital ratios, with operations expected to start by year-end.
Q: Is there any update on Banamex's IPO plans, and has there been any registration activity at Bolsa for this listing?
A: Jorge Alegria Formoso, CEO, mentioned that while they are aware of Banamex's IPO intentions for 2025, there has been no formal registration activity or timeline communicated to Bolsa Mexicana de Valores as of now.
Q: How will the new pricing scheme impact Bolsa's financial outlook for 2025, and was this anticipated in your budgeting?
A: Ramon Gumez Sarre, CFO, confirmed that the estimated impact of MXN90 million to MXN110 million on revenues was not anticipated in their original budget for 2025. The fee reduction is a response to market competition and not a voluntary decision by Bolsa.
Q: What are the expectations for expense growth and margin pressure in light of new initiatives and the competitive pricing environment?
A: Ramon Gumez Sarre stated that while they are not providing specific guidance, the new fee schedule and investments in marketing and technology will put pressure on revenues and margins. The focus is on reorganizing efforts to enhance top-line growth despite these challenges.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.