Foreign acquisitions drive Swiss stock exchange to expected loss
The operator of Switzerland’s main stock exchange, SIX Group, has warned of expected losses this year running into billions of francs.
The reason is negative value adjustments to its stake in payments provider Worldline participation and the Spanish stock exchange, which SIX bought in 2020.
The stock exchange operator expects a negative consolidated result in the range of CHF1 billion to CHF1.1 billion for 2023, it announced on Thursday.
In 2022 it had a net profit of CHF185 million. And in the first half of 2023 alone, SIX earned CHF105 million.
SIX said the market environment, characterised by inflation and rising interest rates, was challenging. In particular, the sharp decline in the share price of the French payment service provider Worldline, in which SIX holds 10.5%, is a burden.
In the fourth quarter of 2023 there will be a value adjustment of around CHF860 million.
Furthermore, the “goodwill” in the books for Bolsas y Mercados Españoles (BME) will be revised downwards by CHF340 million. The reasons are higher discount rates and lower trading volumes.
In technical jargon, goodwill means the difference between the selling price for a company and the intrinsic values determined in accounting. SIX bought BME in 2020 for around €2.6 billion.
The group was said to be doing well operationally. For the full year 2023, SIX expects currency-adjusted sales growth of around 3%. Operating profit EBITDA is expected to increase by 6 to 7% after adjusting for currency effects.
In addition, SIX is highly capitalised. Despite the high loss, it plans to pay out a slightly higher dividend for the 2023 financial year than in the previous year. For the year 2022, the shareholders – around 120 financial institutions – received CHF5.10 per share.
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