Inflation is one of the reasons: Swiss stock exchange operator SIX expects losses of billions of dollars

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The exchange operator expects negative consolidated results in the range of 1.0 to 1.1 billion francs for 2023, it announced on Thursday. It made a net profit of 185 million in 2022. And in the first half of 2023 alone, SIX earned 105 million francs.

The market environment is said to be challenging, characterized by inflation and rising interest rates. In particular, the sharp decline in the share price of French payment service provider Worldline, in which SIX holds a 10.5 percent stake, is a burden. There will be a value adjustment of around 860 million francs in the fourth quarter of 2023.

Additionally, the “goodwill” in the books of Bolsas y Mercados Españoles (BME) will be revised downwards by 340 million francs. The reasons for this are higher discount rates and lower transaction volumes.

In technical jargon, goodwill refers to the difference between a company’s selling price and intrinsic values ​​determined in accounting. SIX acquired BME in 2020 for approximately 2.6 billion euros.

The group was said to be operationally in good shape. SIX expects currency-adjusted sales growth for the full year 2023 to be around 3 percent. Operating profit EBITDA is expected to increase by 6 to 7 percent after adjusting for currency effects.

Also, the capitalization of SIX is quite high. Despite the high loss, it plans to pay slightly higher dividends for the 2023 fiscal year than in the previous year. For 2022, shareholders (about 120 financial institutions) received 5.10 francs per share.

The financial infrastructure service provider plans to announce detailed annual results on March 13, 2024.

(SDA)

Source :Blick