Ann: FLLYR: NZX: Financial Results for the Full Y

• Release Date: 20/02/12 11:54
• Summary: FLLYR: NZX: Financial Results for the Full Year ended 31 December 2011
• Price Sensitive: No
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NZX
20/02/2012 09:54
FLLYR

REL: 0954 HRS NZX Limited

FLLYR: NZX: Financial Results for the Full Year ended 31 December 2011

NZX 2011 Full Year Result

NZX delivers 56% profit growth in difficult environment; momentum continues

20 February 2012 - NZX has delivered a strong 2011 profit result, with NPAT
growing by 56%, despite the obvious challenges in the global environment.
This growth has been generated off installed platforms and infrastructure and
is, accordingly, characterised by low capital intensity and strong free cash
flow.

"The key to the 2011 result was broad based revenue growth, expanded
operating margins achieved by adding new product to scalable infrastructure,
and the integrated nature of NZX's business model," said NZX CEO Mark Weldon.

2011 operating result

The Preliminary Full Year Result shows a significant increase in Operating
Profit (EBITDAF) of 21% and Net Profit After Tax (NPAT) of 56%.  Earnings Per
Share grew a corresponding 57%.

"These results were delivered by a combination of strong execution against
plan, balanced revenue growth and an ongoing focus on cost discipline. These
core factors enabled NZX to meet its objective to deliver non capital
intensive, high quality growth, as illustrated by a growing gap between the
growth rates of the revenue and cost lines," said Weldon.

Operating revenue grew 11% to $55.6 million, compared with $50.2 million in
the previous year.  By comparison, operating expenditure grew by just under
4% to $30.4 million.  EBITDAF growth kept pace with revenue, reaching $25.2
million, compared with $20.9 million in the previous year.  There has been a
concurrent expansion in operating profit margins from 41.6% in 2010 to 45.3%
in 2011.

This growth demonstrates that NZX has truly bedded in the integrated
Information, Markets and Infrastructure (IMI) system and processes across the
company.

IMI enabled NZX to leverage cross-firm expertise and, where practical,
centralise skills in one location.  This in turn enabled our team to drive
both organic revenue growth - including revenues derived from new products -
and cost efficiencies.

Particular highlights include:

Information
NZX Agri gathered momentum at the topline and improved the cost line.

Markets
NZX Markets saw both a number of significant IPOs, and a marked increase in
trading activity.
NZX Dairy Futures experienced significant growth and is now firmly
established as a viable market, retaining its position as the most liquid
dairy futures contract globally.
NZX Clear met its second half forecast for tonnes traded on the grain
exchange platform.

Infrastructure
Clearing House revenues continued to climb.
Operational performance in all Technology and Market Supervision areas was
strong.

Capital return to shareholders

2011 Full Year dividend
The NZX Board has declared a 2011 dividend of 11 cents per share, in line
with the existing dividend policy.  The fourth instalment of the 2011
dividend is 2.75 cents per share, and will be paid on 23 March, 2012 with a
record date of 9 March, 2012.

Capital return
NZX intends to return circa $32.5 to $35 million to shareholders,
representing 10% of the company's market capitalisation.

To execute this return, NZX has announced:
A 10% pro-rata compulsory share cancellation, subject to shareholder, court
and IRD approval.
The return is expected to utilise NZX's existing ASC balance, with the
remainder of cancelled shares accompanied by imputation credits.
The entire return will be tax effective to shareholders.
The return is expected to take place before the end of May 2012.

More detail on the mechanics of the capital return via share cancellation is
contained in the appendix to this release.

Stock split
A stock split of seven for three will be effected with the capital return.

2012 dividend
Guidance on the 2012 dividend will be announced by the Board at the 30 April,
2012 NZX Annual Meeting.

Outlook

The second half of 2011 in particular saw strong momentum across the
business, which is flowing through into the first quarter of 2012.  The key
focus in 2012 will remain free cash flow growth.

EBITDAF margin growth rate is expected to continue at a similar rate to 2011,
due to the addition of new products operated on scalable infrastructure.

On the revenue side, liquidity in the cash equities, derivatives and
commodities markets is expected to continue to grow.  Market data revenues
are expected to improve.  In addition there is further scope for revenue
growth through the Fonterra Shareholders' Market and listed Fund.

The focus on cost management will continue, with cost growth expected to be
maintained at similar levels to those held in 2011.

Summary

Since becoming a public company, NZX has delivered consistent topline growth
with an expanded footprint across sectors and across geographies, and has
developed new markets and platforms.

"This model has shown strength across a full variety of economic, regulatory
and political conditions," said Mark Weldon.

The business model has, over time, delivered increasing yield to accompany
the growth.  Therefore, NZX as a stock spans the spectrum of growth and
yield. It has proved to be a healthy combination for markets and
shareholders alike.

ENDS
End CA:00219719 For:NZX    Type:FLLYR      Time:2012-02-20 09:54:20