JSE Interim Results Presentation 2012 Highlights

INTERIM RESULTS PRESENTATION 2012 Nicky Newton-King, CEO August 2012 www.jse.co.za

H1 SYNOPSIS Difficult first half slows revenue growth Globally Enormous upheaval in financial services industry Slow economic growth in many regions worldwide Globally, exchanges under pressure as volumes drop At the JSE Low operating revenue growth despite Increase in number of trades but following reduction in equity trading revenue Volume growth in most other JSE markets Good data revenue growth JSE response Strong cost control and decision on legacy platforms Investment in sustainable growth areas www.jse.co.za 2

TAKING THE PAIN SRP impairment knocks results Technical advice: desirable to completely rewrite 1 of 5 components of SRP Board has accepted advice Results in impairment to SRP of R72.6m Impact of impairment on H1 results Carrying value of SRP at end 2011 R158.0m Impairment in H1 2012 - R72.6m Remaining aspects of SRP allocated to appropriate projects Surveillance R54.0m T+3 R22.8m PSP II R7.6m Cost previously capitalised, expensed while review done approx R23.9m (2011: R36.1m) 48 people to be rolled off Retained portion of 2011 bonus impact R7.3m Forfeited completely by 2011 Execs Forfeited in part by other JSE staff www.jse.co.za 3

H1 ACHIEVEMENTS Progress on key initiatives Completed data centre & disaster recovery site Implemented the new equity trading system and SENS on time and on budget New system moved to Johannesburg from London Implemented Point of Presence in London for access by international clients Upgraded the commodities and derivatives market technology Relooked at pricing in most products Way forward found on securities transfer tax In conjunction with National Treasury and market participants Made significant progress on ensuring that clearing, settlement and risk management services will meet CPSS-IOSCO standards Also that JSE clients obtain maximum Basel 3 relief www.jse.co.za 4

OPERATIONS www.jse.co.za

REVENUE BREAKDOWN Listings and Equity Market slip; rest of Group still growing Group 2012 R m 2011 R m % Six months to June change Issuer Regulation 46.1 48.8 (5%) Equity market Back-office services and Equities risk management 161.2 204.6 172.6 198.9 (7%) 3% Equity Derivatives 57.0 55.9 2% Interest Rate products 20.5 19.0 8% Currency Derivatives 8.3 7.2 14% Commodity Derivatives 24.5 23.6 4% Data Sales 70.8 61.1 16% All percentages in document calculated on unrounded numbers www.jse.co.za 6

ISSUER REGULATION Revenue fell by 5% to R46.1m (H1 2011: R48.8m) Continuing trend of few new company listings 50 40 Decline in volume of corporate actions Issuance during period 3 companies listed during period (H1 2011: 5) 30 8 companies delisted (H1 2011: 8) 20 6 exchange traded products listed (H1 2011: 4) 3 transfers from AltX to Main Board (H1 2011: 4) 10 H1 focus Business development activity 0 Amended requirements for publication in print media 2008 2009 2010 2011 2012 Revenue (Rm) www.jse.co.za 7

EQUITY MARKET Revenue down 7% to R161.2m (H1 2011: R172.6m), driven by Slower equity transaction growth (H1 2012: 13.2m trades; H1 2011: 12.9m trades) 180 160 140 Despite 10% rise in value traded (H1 2012: R1.7tr; H1 2011: R1.59tr) 120 100 H1 focus Implemented new equity trading system 80 Trading engine now based in Johannesburg 60 With faster trade times, scope for volume growth and co-location offering 40 20 0 2008 2009 2010 2011 2012 Revenue (Rm) www.jse.co.za 8

BACK OFFICE SERVICES AND EQUITY RISK MANAGEMENT Revenue up 3% to R204.6m (H1 2011: R198.9m) Revenues driven by the number of transactions on the cash equity market 210 180 150 H1 focus All Post Trade Services (excl Commodities Clearing) combined in one Division 120 Ensuring Safcom CPSS-IOSCO compliant by Dec 2012 90 60 Working on OTC Derivatives clearing solution with market participants 30 BDA continues as interim solution investigating feasibility of customising it for T+3 0 2008 2009 2010 2011 2012 Back office services & Equity risk management revenue (Rm) www.jse.co.za 9

BONDS AND FINANCIAL DERIVATIVES Revenue up 4% to R85.8m (H1 2011: R82.2m) 90 Equity deriv contracts down 6%; value up 3% 80 Currency deriv contracts up 27%; value up 28% 70 Bond Market (nominal value) up 16% to R11.6tr (H1 2011: R10.0tr) 60 Interest Rate deriv volumes up 81%; value up 65% H1 focus 50 40 30 Trading system upgraded 20 Strong growth in index derivatives 10 New billing model introduced for Currency Derivatives market increased activity 0 2008 Charges on Bond Futures and Options and Cash Bond transactions simplified increased activity 2009 2010 2011 2012 Revenue (Rm) www.jse.co.za 10

COMMODITY DERIVATIVES Revenue up 4% to R24.5m (H1 2011: R23.6m) Increased trade: contracts up 19%; value up 37% 25 Increase in number of physical deliveries processed 20 Improved activity in the cash settled commodities H1 focus New products launched 15 Alignment of hard commodity instruments and currency futures expiries 10 Enhancement of trading system 5 Close to obtaining approval for US$ traded and settled Zambian grain derivative contract to extend access through the JSE to other African countries 0 2008 2009 2010 2011 2012 Revenue (Rm) www.jse.co.za 11

DATA SALES Revenue grew 16% to R70.8m (H1 2011: R61.1m) Rise in international professional terminal users 80 70 Overall number of professional terminals up 5% 47% of professional terminals are from foreign clients Non- professional users grew by over 8% 60 50 40 30 20 10 0 2008 2009 2010 2011 2012 Revenue (Rm) www.jse.co.za 12

FINANCIAL REVIEW www.jse.co.za

INCOME STATEMENT Six months ended 30 June 2011 Group 2012 2011 % change R million 682.8 R million 667.9 20.8 (375.8) 312.9 42.1 15.1 370.1 (116.2) 253.8 299.0 288.9 Revenue Other income Operating and other costs (incl Personnel costs) Profit before net financing income Net finance income Share of profit of equity accounted investees Profit before tax Income tax Profit for the period Basic earnings per share (cents) Headline earnings per share (cents) 2% 11.7 (44%) 34% (39%) (2%) 14% (33%) 28% (60%) (61%) (15%) (503.6) 190.9 41.4 17. 1 249.4 (148.7) 100.7 117.0 245.5 www.jse.co.za 14

COSTS Impacted by SRP impairment; nonetheless costs controlled Personnel expenses up 19% to R161.1m (H1 2011: R134.9m) Excluding SRP impact, personnel costs up 9% Most of the 9% rise made up of salary increases and a slight rise in staff numbers Other expenses up 42% to R342.5m (H1 2011: R240.9m) Excluding SRP impact, other expenses up 12% 12% rise made up of increases in computer and consulting fees Total operating costs increased by 34% primarily as a result of Impairment Impact of lower capitalisation charge on personnel expenses Early retirement payments (R6.2m) Withholding of bonus (R7.3m) Current renewed focus on costs in tough environment includes Rolling off of contract resources www.jse.co.za 15

CAPITAL STRUCTURE AND DIVIDENDS Net cash positive Capital requirements under review Will be impacted by clearing and equity business model decisions Board declares dividend only at year-end in ordinary course If have cash surplus to JSE needs www.jse.co.za 16

LOOKING AHEAD www.jse.co.za

PROSPECTS Approach to H2 2012 Interdependencies between the exchange, the financial services and its broader stakeholder group have become more apparent Focused on resilience and sustainability We will continue retaining our strong focus on Controlling costs with the MSS impairment charge now taken; and increased staff costs offset by a lower consulting contingent Making the right strategic investments for our long term growth Post Trade Services Data Technology www.jse.co.za 18

QUESTIONS www.jse.co.za