ASX (ASX) Investor Update summary

Strategic progress and focus areas

• One year into a five-year strategy, with strong progress on regulatory commitments, technology modernization, and business efficiency as key priorities for FY25.

• Investment is concentrated on maintaining high-quality, resilient infrastructure and meeting regulatory standards, including ongoing CHESS replacement and technology upgrades.

• Growth opportunities are being explored in technology, data, and sustainability-linked products, leveraging structural tailwinds like Australia’s large pension system and demand for market data.

• The organization is targeting Net Zero Scope 1 and 2 emissions in FY25 and is developing products to support the transition to Net Zero.

• A cultural shift is underway, with a move to new offices and a focus on employee experience and productivity.

Financial guidance and capital management

• FY25 total expense growth is guided at 6%–9%, with operating expense growth (excluding D&A) at 4%–7%, reflecting ongoing technology investments and cost management initiatives.

• Capital expenditure for FY25 is forecast at AUD 160–180 million, mainly for technology modernization, with elevated CapEx expected through FY27 before tapering.

• Dividend payout ratio remains at 80%–90% of underlying profit, supported by a dividend reinvestment plan and a recent AUD 275 million corporate bond issue.

• Medium-term ROE target is 13%–14.5%, with a focus on returning to this range through revenue growth and expense control.

• FY24 expense growth is forecast at -15%, with a reduction in 2H24 expenses.

Technology modernization and project updates

• Major technology projects include CHESS replacement (in partnership with TCS and Accenture), derivatives clearing upgrades, and trading platform enhancements.

• Regular service releases and platform upgrades are planned to ensure resilience, reduce complexity, and align with global best practices.

• Technology modernization is staged to manage delivery risk and build capability, with a focus on cloud, data, and integration platforms.

• Ongoing industry consultation for CHESS replacement, with staged implementation and focus on T+1 settlement and interoperability.

• High system availability and stability have been maintained during modernization, with a track record of successful project delivery.