WELCOME Second Quarter Financial Year 2011

18 January 2011

Analyst and Media Briefing

Magnus Bcker CEO Bcker, Seck Wai Kwong, CFO

Agenda

1. 2. 3. 4.

Highlights Financial Performance Business Update Questions & Answers

Second Quarter Highlights

Stronger quarter in securities & derivatives markets Proposed ASX-SGX Combination creating the premier Asia Pacific exchange Expanded reach p
Issuer Services: Larger IPOs; Bond listings New Securities & Derivatives members Clearing: OTC Financial Derivatives Securities: GlobalQuote & Chi East Chi-East Derivatives: Euro STOXX50; FTSE Xinhua China A50; Nikkei options

2Q

3Q FY 2010

4Q

1Q FY 2011

2Q

(Note: The above exclude (a) CEO transition costs $6.3M in 2Q FY2010; (b) Impairment adjustments $2.3M in 4Q FY2010; (c) ASX-SGX transaction related costs $7.5M in 2Q FY2011

Financial Performance
Seck Wai Kwong

Financial Performance
Net Profit $82M ($77M) Solid quarter: Revenue up across all businesses Net Profit up 6%; EBITDA up 15%; and Operating Profit up 12%

(1Q FY11 comparatives)

EBITDA Operating profit Earnings per share q y Return on equity

$95M ($100M) $90M ($91M) 7.2 cents (7.0 cents) 11.1% (8.7%) ( )

$110M $101M 7.7 cents 11.3%

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[Excludes (a) CEO transition costs $6.3M in 2Q FY2010; (b) ASX-SGX transaction related costs $7.5M in 2Q FY2011. Some numbers may be subject to rounding]

Financial Performance
Revenues: $172M ($151M) Increased securities & derivatives trading volumes Increased institutional volume
+14
SDAV $1.8B from $1.4B

+3
F&O DAV 248k from 222k USD depreciation by 6%

+2

+4
Increased institutional trades

Increased connectivity New Members

172

151

Capped trades, 46% from 37%

Securities

2Q FY10

Derivatives

Market Data

Member Services & Connectivity

Depository Services

Issuer Services

2Q FY11

(% Revenue)
($M)

(47%) 81 71 67

(20%) 34 34 31

(5%) 8 8 8

(5%) 10 9 8

(14%) 24 21 20

(9%) 16 16 16

(100%) 172 159 151 7

2Q FY11 1Q FY11 2Q FY10

[Note: Some numbers may be subject to rounding]

Financial Performance
Expenses: $72M ($61M) Technology investments: SGXClear; OTC Clearing; the Reach initiative Maintain capex guidance $60-65M Expect ASX-SGX transaction related costs in FY2011: $20M ($ p $ ($7.5M in 2Q) Q)
+6 +1

+3
Salary adjustments

Increased Technology activities investments

61
Job Credit Scheme
2Q FY10 Staff Technology Processing & Royalties Premises Professional fees Others

72

2Q FY11

(% Expenses) ($M) 2Q FY11 1Q FY11 2Q FY10

(39%) 28 28 25

(36%) 26 24 19

(9%) 7 6 6

(7%) 5 5 5

(3%) 2 2 3

(6%) 4 3 3

(100%) 72 68 61 8

[Excludes (a) CEO transition costs $6.3M in 2Q FY2010; (b) ASX-SGX transaction related costs $7.5M in 2Q FY2011. Some numbers may be subject to rounding]

Financial Indicators
(Adjusted)

2Q FY11 110 101 82 721 44

1Q FY11 100 91 74 854 36

4Q FY10 100 91 77 816 41

3Q FY10 97 90 75 731 48

2Q FY10 95 90 77 693 47

EBITDA ($M) Operating Profit ($M) Net Profit ($M) Total E it T t l Equity ($M) Return on Equity (%) Per Share (cents) Operating Cash Flow Earnings Dividend No. of shares issued (M)

7.7 7.0 4.0 1,071

8.3 7.0 4.0 1,071

9.2 7.5 15.75 1,071

9.2 7.0 3.75 1,070

8.5 6.8 3.75 1,070

Note 1: Except for Earnings Per Share data, the above excludes (a) CEO transition costs $6.3M in 2Q FY10; (b) Impairment adjustments $2.3M in 4Q FY10; (c) ASX-SGX transaction related costs $7.5M in 2Q FY11 Note 2: Return on Equity is on 12-month rolling basis Note 3: The above number of shares issued includes treasury shares of 4.3M for 2Q FY11 and 5.2M for other quarters Note 4: Some numbers may be subject to rounding

Business Update p Magnus Bcker

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Securities: Trading and Clearing

Revenue: $81M, 47% ($67M, 45%)
Metrics Key drivers

Market Structure
Continuous all day trading Remote trading membership Turnover velocity

2Q FY11 377 64 63 48 95 118 1.60 1.77 1 77 45 2 46 54

1Q FY11 365 64 60 48 89 115 1.66 1.56 1 56 25 2 42 58

4Q FY10 337 63 63 54 70 148 1.48 1.53 1 53 30 2 39 61

3Q FY10 342 61 64 52 86 139 1.61 1.51 1 51 14 2 37 63

2Q FY10 349 64 59 52 62 132 1.43 1.36 1 36 20 1 37 63

MSCI Singapore Index No. of Trading Days Equity Turnover Velocity (%) Singapore issuers Overseas issuers, excluding Chinese issuers Chinese issuers Daily Average Trading Volume (billion shares)

Products & Services

GlobalQuote Chi-East

Daily Average Trading Value ($ billion) ETFs/ETNs ($ million) Company warrants

Contracts value
More than $1.5M Less than $1.5M

Securities Revenue ($M)

67 70 72 71 81

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(Source: WFE, 1Q FY11 = Jul to Sep 10; 2Q = Oct to Dec 10) [Note: Some numbers may be subject to rounding]

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Derivatives: Trading & Clearing

Revenue: $34M, 20% ($31M, 21%) Market Structure
Open connectivity for registration of off market large trades off-market
Key drivers Daily Average Volume (000 contracts) Nikkei 225 futures (days) MSCI Taiwan futures (days) Nifty futures (days) MSCI SG futures (days) FTSE Xinhua A50, in contracts (days) Nikkei options, in contracts (days) Interest rate futures Extended settlement (shares) Structured St t d warrants t ($M) Market Share (%) Nikkei 225 futures MSCI Taiwan futures Nifty futures HFT (%) Commodities (Daily average Rubber futures Gold futures Fuel Oil futures AsiaClear Volume (lots) cleared FFAs Energy swaps Iron Ore swaps 2Q FY11 249 111 (61) 56 (66) 48 (63) 14 (64) 7,851 (61) 7,318 (61) 3 122,953 24 1Q FY11 242 122 (63) 60 (65) 39 (65) 15 (64) 841 (63) 1,155 (63) 3 41,000 19 Metrics 4Q FY 10 257 131 (61) 64 (63) 42 (63) 15 (63) 0 (60) 598 (61) 3 47,222 22 3Q FY10 234 106 (60) 70 (56) 39 (59) 15 (61) 0 (58) 916 (60) 3 80,705 25 2Q FY10 222 108 (61) 61 (66) 34 (60) 14 (64) 0 (60) 516 (61) 3 66,547 27

Product Development
OTC financial derivatives FTSE Xinhua China A50; Nikkei options; Nikkei Dividend futures Pipeline
Nift options & metal contracts Nifty ti t l t t
Derivatives Revenue ($M)
31 32 34 34 34

28 24 14 29

27 24 13 30

27 22 12 25 882 5,158 24 31,764 13,420 10,615 7,729

26 25 11 26 1,009 8,530 24 35,782 20,920 7,288 7,574

26 27 9 26 1,106 NA 24 37,347 26,448 6,431 4,468

trading volume, contracts) 898 827 1,935 2,590 37 30 40,873 21,259 11,676 7,938 48,175 27,004 11,610 9,561

[Note: Some numbers may be subject to rounding]

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Market Data: Information sales & distribution

Revenue: $8M, 5% ($8M, 5%)

Market Structure
Key drivers

Metrics 2Q FY11 1Q FY11 4Q FY10 3Q FY10 2Q FY10

Evolving trading strategies: g g g demand for low latency offering

Securities Data
No. of vendors 126 40,032 122 37,816 122 38,703 122 40,607 121 36,717 No. of terminals (Average)

Products and Services

Derivatives pricefeed
Low latency feed (Nov 10) DerivativesQuote Level 1 fee revision (Apr 11)

Derivatives Data
No. of vendors No. of terminals (Average) 62 23,614 58 23,810 57 24,168 57 24,842 55 25,158

Pipeline Non-price market data Commodities quote

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Member Services and Connectivity

Revenue: $10M, 5% ($8M, 5%) Membership
New securities members New derivatives clearing members
Key drivers 2Q FY11 1Q FY11 Membership Securities members Trading Representatives Trading Members Clearing Members Derivatives members Trading Member (Individual) Trading Member (Proprietary) T di M b (P i t ) Trading Members Clearing Members 216 246 30 34 72 21 234 248 30 26 71 21 228 242 30 26 67 20 214 240 30 25 66 20 201 235 30 25 64 18 4243 30 29 4147 27 27 4095 26 26 4008 26 26 3908 24 25 Metrics 4Q FY10 3Q FY10 2Q FY10

Reach Initiative
Co-location: On track for 4Q launch SGX Reach: FY 2012

SICOM members Trade / Associate Members Clearing / Non-Clearing Members: Brokers / Dealers AsiaClear No. of counterparties Connectivity Securities Market Connectivity (no.) Order Management System (no.) Independent software vendor (no.) Derivatives Market Connectivity (no.) Order Management System (no.) Independent software vendor (no.) (no ) Proximity Hosting 604 60 12 18 579 57 11 17 578 55 11 17 559 53 11 17 530 46 9 15 89 32 10 92 32 11 88 28 11 74 28 11 78 26 9 617 561 512 467 412

Member Services and Connectivity Revenue ($M) 8 8 8 9 10

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[Note: Some numbers may be subject to rounding]

Depository Services: Settlement & Depository

Revenue: $23M, 14% ($20M, 13%) Market Structure
Key drivers

Metrics 2Q FY11 1Q FY11 4Q FY10 3Q FY10 2Q FY10

Settlement of institutional trades

Securities settlement No. of settlement instructions (000) Contracts processing Contracts processed (000) Depository management Depository accounts 1.53M 1.50M 1.49M 1.48M 1.47M 2,991 2,848 2,966 3,050 3,032 1,365 1,169 1,124 1,049 1,048

Services & Asset Classes

Growing securities borrowing and lending Expanding asset classes and services

Depository Services Revenue ($M)

20 19 21 23 21

[Note: Some numbers may be subject to rounding]

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Issuer Services: Listing and related services

Revenue: $16M, 9% ($16M, 11%) Capital Raising
Equity: New Listings
Key drivers Listings No. of listed issues Equity securities Debt securities ETFs/ETNs Company warrants Structured warrants No. of Delistings: Equity securities Equity Market Capitalisation, $B (No. of issuers) Singapore issuers 2Q FY11 1Q FY11 Metrics 4Q FY10 3Q FY10 2Q FY10

782 1,313 75 74 312 9 902 (782) 474 (461) 372 (165) 55 (156) 12 12 (15,718) 0 () (-) 7,258 4,937 2,321 479

779 1,258 75 82 234 10 856 (779) 461 (457) 353 (167) 41 (155) 8 8 (670) 0 () (-) 1,467 82 1,386 553

783 1,229 73 80 233 11 781 (783) 428 (460) 316 (169) 36 (154) 12 11 (3,758) 1 ( , ) (27,647) 1,132 844 288 689

782 1,198 58 82 301 6 758 (782) 435 (461) 285 (166) 37 (155) 7 6 (1,616) 1 ( , ) (1,238) 1,054 522 532 414

781 1,164 44 74 315 7 745 (781) 429 (459) 277 (166) 39 (156) 12 12 (8,791) 0 () (-) 8,075 3,004 5,071 442

Fi d i Fixed income: B d /N t Bonds/Notes

Overseas issuers excluding issuers, Chinese issuers Chinese issuers New equity listings Primary listings: IPOs & RTOs (Market capitalisation, $M) Secondary listings ( p , $M) (Market capitalisation, $ ) Total Equity Funds Raised ($M) Primary funds raised Secondary funds raised Corporate actions No. of transactions

Issuer-related services

Issuer Services Revenue ($M)

16

15

17

16

16

(Source: WFE, 1Q FY11 = Jul to Sep 10; 2Q = Oct to Dec 10)

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In summary

Proposed ASX-SGX combination creating the premier Asia Pacific exchange g Market structure
Continuous all day trading Remote trading members for securities market SICOM contracts on SGX platform

Products & Services

OTC financial derivatives GlobalQuote Nifty options Metal contracts in collaboration with London Metal Exchange

Technology
C l Co-location services & SGX R ti i Reach h
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Creating the Premier Asia Pacific Exchange

Landmark combination at heart of global growth
International exchange group with improved strategic positioning to capitalise on Asia Pacific growth Greater global relevance with enhanced growth opportunities Highly cash generative business model with increased resources to deliver new product & services

Compelling transaction creating more value for shareholders

EPS accretion delivering more value for shareholders Projected increase in absolute DPS in medium term with minimum 70% payout of NPAT Potential re-rating on improved growth prospects from complementary & diversified revenue re rating streams

Proactive engagement with all key stakeholders

S t Systematic engagement to identify and address l iti t concerns ti t t id tif d dd legitimate Constructive discussions ongoing with regulators and other key constituents Regulatory due process proceeding as planned, with ACCC confirmation obtained in December 2010

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QUESTIONS & ANSWERS

THANK YOU

Appendices

Securities Trading Value vs MSCI Singapore Index

0.93 0.76 1.19 1.21 0.91 1.27 1.97 2.28 2.59 2.37 1.90 1.62 1.27 1.03 0.91 1.68 1.73 1.36 1.51 1.53 1.56 1.77

FY2006

FY2007

FY2008

FY2009

FY2010

FY2011

(Source: Bloomberg)

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Futures & Options Volume vs Volatility

Futures & Options: DAV vs Volatility

300 250 F&O DAV ('000 contracts) V 200 150 60 100 50 0 FY2006
F&O DAV ('000 contracts)

103 125 155 156

140 136 168 165 198 189 251 231

273 246 204 227 214 222 235 257 242 248

140 120 100 80 10D Volatility (%) D

40 20 0 FY2007 FY2008 FY2009

TWSE Index Nifty Index

FY2010

FY2011
MSCI SG Index

Nikkei225 Index

(Source: Bloomberg)

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While SGX and its affiliates have taken reasonable care to ensure the accuracy and completeness of the information provided in this presentation, they will not be liable for any loss or damage of any kind (whether direct, indirect or consequential losses or other economic loss of any kind) suffered due to any omission, error, inaccuracy, incompleteness, or otherwise, any reliance on such information. Neither SGX nor any of its affiliates shall be liable for the content of information provided by or quoted from third parties. Examples provided are for illustrative purposes only. The information in this presentation is subject to change without notice. Any recirculation, transmission or distribution of this presentation or any part thereof by any third party requires the prior written permission of SGX. SGX and its affiliates disclaim all responsibility and liability arising in connection with any unauthorised recirculation, transmission or distribution of this presentation or any part thereof.

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