Hong Kong Exchanges and Clearing (388) Q1 2025 earnings summary

Executive summary

• Q1 2025 delivered record revenue, profit, and trading volumes, driven by renewed global interest in China, AI innovation, and increased Mainland investor participation in offshore markets.

• Achieved record quarterly revenue and profit in Q1 2025, with profit attributable to shareholders at HK$4.1b, up 37% year-over-year and 8% sequentially.

• 2024 marked a strong year with record-breaking trading volumes and exceptional financial results, reflecting resilience amid macroeconomic and geopolitical challenges.

• Strategic initiatives included new product launches, enhancements to settlement fees, Stock Connect improvements, and expanded international partnerships.

• The group purchased several office floors at Exchange Square for a permanent headquarters, supporting long-term cost savings and stakeholder engagement.

Financial highlights

• Revenue and other income reached HK$6.9b, up 32% year-over-year and 7% sequentially, driven by strong trading volumes across Cash, Derivatives, and Commodities markets.

• Core business revenue was HK$6.3b, up 36% year-over-year; EBITDA was HK$5.3b, up 42% year-over-year.

• Profit attributable to shareholders was HK$4.1b, up 37% year-over-year and 8% sequentially; basic EPS was HK$3.23, up 37%.

• Operating profit increased 46% year-over-year to HK$4.9b; EBITDA margin improved to 78% from 72% a year ago.

• Headline ADT on the Stock Exchange hit HK$242.7b, up 144% year-over-year.

Outlook and guidance

• Management aims to leverage China connectivity, expand global market links, and enhance product offerings to remain resilient against macro volatility and capture future opportunities.

• Equity capital raising in Hong Kong revived, with US$20b+ in deal value year-to-date, ranking second globally.

• IPO pipeline remains robust with 120 active applicants as of March 31, 2025.

• Plans to implement streamlined settlement fees, minimum spread reduction, and post-trade service enhancements in coming months.

• Ongoing focus on innovation and maintaining Hong Kong’s leadership as an international financial center.