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Summarised annual financial results & ordinary & special cash dividend declarations for the year ended 31 Dec 2021
JSE Limited
(Incorporated in the Republic of South Africa)
Registration number 2005/022939/06
Share code: JSE
ISIN: ZAE000079711
LEI: 213800MZ1VUQEBWRFO39
(JSE or the Group)
SUMMARISED CONSOLIDATED ANNUAL FINANCIAL RESULTS AND ORDINARY AND SPECIAL CASH DIVIDEND DECLARATIONS
FOR THE YEAR ENDED 31 DECEMBER 2021
"The JSE has delivered robust performance under a challenging macro-economic and trading
environment. Our resilience while navigating an unfamiliar route through the pandemic has confirmed
the value of the investments we have made in our technology platforms over an extended period. I am
pleased that the JSE has been able to deliver a high level of service to its clients and the broader public
while managing extreme market events and uncertainty." - Dr Leila Fourie, Group CEO
OVERVIEW OF RESULTS
- Earnings before interest, tax and depreciation (EBITDA) of R1.06 billion was flat YoY. This was attributable to disciplined cost management, a positive
contribution from JIS and a rebound in value traded in H2.
- Operating revenue grew 3% YoY to R2.52 billion.
- Operating expenditure was well contained, up 4% YoY to R1.78 billion, with the JSE Investor Services (JIS) acquisition fully consolidated (down 2% on a
comparable basis).
- A record low interest rate environment resulted in finance income declining 27% YoY to R146 million, which directly impacted net profit after tax (NPAT),
which was down 7% YoY to R722 million. Earnings per share (EPS) and headline earnings per share (HEPS) declined 7% and 6% YoY to 874.1 cents and 878.9
cents per share respectively (2020: 936.7 cents).
- Strong cash generated from operations has enabled the Board to declare an ordinary dividend of 754 cents per share for 2021, an increase of 4% YoY in line
with the JSE's progressive dividend policy. This corresponds to an ordinary dividend pay-out of 92% of distributable profits in 2021 (2020: 83%). It is
supplemented by the declaration of a special dividend of 100 cents per share (2020: NIL).
- In compliance with the provisions of the Financial Markets Act, 2012, and the risk appetite set by the Board, the JSE Group calculates and holds regulatory
capital in the form of equity capital. This amounts to R1.13 billion in total for JSE Limited and for JSE Clear, of which R789 million is held in the form
of restricted cash and cash equivalents. The Group therefore remains well capitalised.
- The Group maintains a robust balance sheet and cash reserves of R2.4 billion at 31 December 2021
(2020: R2.5 billion).
OVERVIEW OF RESULTS
R million (unless stated otherwise) FY2021 FY2020 % change
Operating revenue 2 517 2 446 3%
Total revenue 2 576 2 528 2%
Personnel expenses 650 601 8%
Other operating expenses 871 868 0%
Depreciation and amortisation 258 249 3%
Total expenditure 1 779 1 718 4%
Earnings before interest and tax (EBIT) 798 811 (2%)
Net finance income 146 200 (27%)
Net profit after tax (NPAT) 722 778 (7%)
EBIT margin 31% 32% (1pt)
Earnings before interest tax depreciation and amortisation (EBITDA) 1 055 1 060 0%
EBITDA margin 41% 42% (1pt)
Earnings per share (EPS) (cents) 874.1 936.7 (7%)
Headline earnings per share (HEPS) (cents) 878.9 936.7 (6%)
Ordinary dividend per share declared (cents) 754 725.0 4%
Special dividend per share declared (cents) 100 Nil -
Net cash generated from operations 917 1 003 (9%)
Earnings cash conversion (as a % of adjusted NPAT)* 101% 104% (3pts)
Capital expenditure 165 89 85%
* Earnings cash conversion is calculated by dividing net cash generated from operations by adjusted NPAT. Adjusted NPAT is calculated by deducting
the following tax-adjusted non-cash items from NPAT: Depreciation and amortisation (note 7.2), effects of exchange rate fluctuations on cash held
(Consolidated statement of cash flows) and expected credit loss impairments (Consolidated statement of comprehensive income).
DECLARATION OF ORDINARY AND SPECIAL CASH DIVIDENDS
The Board has declared an ordinary cash dividend and a special cash dividend for the year ended 31 December 2021, as follows:
Dividend Withholding
Annual gross tax Net
amount per share % amount
Ordinary 754 cents 20% 603.20 cents
Special 100 cents 20% 80 cents
The JSE's practice has been to return distributable cash to shareholders after ring-fencing cash for regulatory capital requirements and investments (both
capital expenditure and inorganic opportunities).
The ordinary dividend of 754 cents per share represent a 4% increase on the 725 cents per share paid in 2020. In addition a special dividend of 100 cents
per share for 2021 has been declared. This is congruent with the Group's policy of progressively growing the nominal value of the ordinary dividend over
time, subject to retaining cash for regulatory capital and investments, including acquisitions. The ordinary dividend pay-out ratio corresponds to 92% of
distributable profits in 2021 (2020: 83%). The total dividend pay-out ratio is 104%.
The Group's dividend policy is to maintain a dividend cover ratio of 1.5x-1x earnings (a pay-out ratio)
of 67%-100% of current earnings. This pay-out range reflects the fact that cash generated exceeds
NPAT, largely as a consequence of the amortisation of technology investments in previous years.
This trend is expected to continue for the next few years, and will be influenced by changes in the depreciation and amortisation profile of the Group.
The Board is confident that the existing dividend policy is congruent with the Group's inorganic growth strategy over the near term.
The ordinary and special cash dividends have been declared from retained earnings. A dividend withholding tax of 20% will be applicable to all shareholders
who are not exempt. The dividends are payable to shareholders recorded in the register of members of the JSE at the close of business on Friday, 25 March
2022. In compliance with the Companies Act, 71 of 2008 (as amended) (the Companies Act), the directors confirm that the JSE will satisfy the solvency and
liquidity test immediately after completion of the dividend distribution.
In compliance with the requirements of Strate, the following salient dates for the payment of the ordinary and special cash dividends are applicable:
Dividend paid in respect of financial year ended 31 December 2021 31 December 2020
Ordinary dividend per share 754 cents 725 cents
Special dividend per share 100 cents 0 cents
Total rand value R741 million R630 million
Board declaration date Monday, 28 February 2022 Thursday, 25 February 2021
Special cash dividend finalisation date Monday, 14 March 2022 -
Last date to trade JSE shares cum dividend Tuesday, 22 March 2022 Tuesday, 23 March 2021
JSE shares commence trading ex-dividend Wednesday, 23 March 2022 Wednesday, 24 March 2021
Record date for purposes of determining the registered holders
of JSE shares to participate in the dividends at close of business on Friday, 25 March 2022 Friday, 26 March 2021
Dividends payment date Monday, 28 March 2022 Monday, 29 March 2021
Share certificates may not be dematerialised or rematerialised from Wednesday, 23 March 2022 to Friday, 25 March 2022, both days inclusive. On Monday,
28 March 2022, the dividend will be electronically transferred to the bank accounts of certificated shareholders. The accounts of those shareholders who have
dematerialised their shares (which are held at their central securities depository participant or broker) will be credited on Monday, 28 March 2022.
The issued share capital of the JSE as at the declaration date was 86 877 600 ordinary shares. The tax number of the JSE is 9313008840. South African
Reserve Bank approval is required for the declaration of the special cash dividend and the finalisation date is Monday, 14 March 2022.
For further information
This short-form announcement is the responsibility of the directors. It is only a summary of the information in the full announcement and does not contain
full details. Any investment decision should be based on the full announcement, published and available at:
https://senspdf.jse.co.za/documents/2022/JSE/ISSE/JSE/01032022.pdf and on the JSE website at:
https://www.jse.co.za/investor-relations/results.
Ernst and Young Inc, the Group's independent auditor, has audited the Consolidated Annual Financial Statements ("AFS") of the JSE Limited from which this
announcement has been derived, and has expressed an unmodified audit opinion on the AFS.
The auditor's report (with Key Audit Matters) issued on the AFS and the actual AFS can be accessed at https://www.jse.co.za/investor-relations/results
This announcement itself is not audited and therefore the audit report does not cover this announcement.
The full announcement is also available at our registered offices and the offices of the sponsor for inspection at no charge during office hours. Copies of
the full announcement may be requested by emailing: ir@jse.co.za
Sandton
1 March 2022
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 01-03-2022 10:00:00
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