SIX Swiss Exchange Sets Record for Operating Income in H1 2018

Due to the exchange’s restructuring process, operating income did not completely offset losses.

The SIX Swiss Exchange, Switzerland’s principal stock exchange, has broken a new record. For the first time in the company’s history, it has exceeded CHF 1 billion ($102.6 billion) in operating income. The results were announced today in its interim report for the first half of 2018.

Contributing to the operating income is the exchange’s ‘Cards’ business unit which is the result of a strategic partnership with Worldline, a French provider of e-payment services. According to the statement, the operating income for the business unit increased by 8% year-on-year, reaching CHF 1,000.7 million.

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SIX is currently working towards its strategic and operating realignment (SIX2020). As part of that, towards the end of last year, the exchange announced that it was removing its merchant acceptance, acquiring and international card processing from its core business.

In May of this year, the firm announced that it would be transferring this service to Worldline. By the end of the fourth quarter of this year, the SIX Swiss Exchange is expected to own a 27% stake in the firm. This means that the exchange will continue to benefit from the profit that the unit creates.

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Restructuring hurts net profit and EBIT for SIX Swiss Exchange

However, the restructuring process did hamper net profit for the group in the first half of this year, which was below last year’s figure as expected, coming in at CHF 100.7 million. The rise in operating income partially offset the rise in costs due to the alignment, however, it did not cover all of the losses.

As a result, earnings before interest and tax (EBIT) fell by 15% year-on-year in the first half of 2018, reaching CHF 139.0 million. However, this figure was not as disappointing as it may seem as the fall was in line with expectations.

In the wake of the restructuring, during H1 2018, SIX grouped its securities services together. This means it will offer all services for trading, settlement and custody of securities from one source.

The exchange also combined its Swiss payment system with its interbank payments. It connects to the SEPA region, processis card-based and mobile payments for banks, operates ATMs, and processes e-bills.

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