PSE Q2 profit: P156M (down 27% y/y)

The Philippine Stock Exchange [PSE 180.00, up 2.3%; 10% avgVol] [link] reported a Q2 net income of P156 million, down 27% y/y from its Q2/23 net income of P214 million, and down 36% q/q from its Q1/24 net income of P242 million. The PSE reported a 2.34% decrease in H1 revenues, which it attributed to “11% lower trading value for the period and 31.21% lower revenue from listing-related revenues.”

MB bottom-line: The PSE runs an absolute monopoly on stock trading in the Philippines, so it’s certainly possible that this “whelming” result represents both the best outcome given the incentives available and the worst outcome for practically every single participant. All critiques of the PSE must be made with the acknowledgment that it must play within a system that it cannot directly control (the regulatory framework made by the SEC) and where change is a slow and meandering affair. To the PSE’s credit, it managed to build a framework for short-selling and bring digital apps into the fold like GStocks and Maya. It also created new indices like the DivY and the MidCap, and granted broker status to Investagrams. Big wins. It’s also started to enforce the rules more aggressively on chronic violators and to actually delist companies that have been suspended for (in some cases) decades instead of maintaining the status quo. I don’t love that the PSE is a for-profit company, so I don’t get too wrapped up around its income going up or down. If the PSE made a ton of money because trading volume was high, it would be despite that volume, not because of it. Likewise for listings. Would I like the PSE to have taken more ownership of the short-selling roll-out? Sure. Would I like the PSE to spend less time hyping listings in the press? Of course. But I’m a practical person who tries not to let “perfect” be the enemy of “good”. I’m happy some things are changing. My goal is just to do as I’ve always done for the past five years, which is to try and report what I see in a way that everyone can understand, and hope that I reach those new traders before the Facebook “furus” (financial gurus) do.

---

Merkado Barkada is a free daily newsletter on the PSE, investing and business in the Philippines. You can subscribe to the newsletter or follow on Twitter to receive the full daily updates.