SIX Reports Successful 2021 Performance Despite Challenging Global Situation

2021 was a successful year for SIX, despite the challenges and uncertainties that recurring waves of COVID-19 continued to inflict on society and financial markets. The income benefitted from organic growth and the newly combined business of SIX in Switzerland and Spain: For the first time the Spanish business acquired by SIX in mid-2020 contributed for a full 12 months. All four business units of SIX performed well, although they were differently impacted by various external factors, not least in connection with the pandemic.

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Selected Financials for 2021

  • Operating Income amounted to CHF 1,498.3 million (+8.9%)
  • Earnings before interest, tax, depreciation and amortization (EBITDA) totaled CHF 421.7 million (+14.8%)
  • Non-operating result fell year-on-year due to significant one-off effects (in particular stake in Worldline, non-cash relevant) in the comparison years 2020 and 2021
  • Earnings before interest and tax (EBIT) fell accordingly to CHF 147.2 million (-71.4%)
  • Group net profit totaled CHF 73.5 million (-83.2%)
  • Without the Worldline-related effects, Group net profit rose 37.3% compared to the previous year

2021 Business Highlights

In 2021, key achievements included the launch of SIX Digital Exchange and several new ESG indices and data offerings, the continuing growth of digital billing and invoicing in Switzerland, and the launch of “Sparks”, a new equity segment for SMEs at SIX Swiss Exchange. While equity trading on the stock exchanges did not reach the unprecedented volumes of the previous year, the economic environment was still favourable for the Exchanges and Securities Services business. As of 1 January 2021, these units consist of the combined businesses of SIX in Switzerland and BME in Spain.

Given the rapidly evolving state of industry consolidation, M&A has remained key to strengthening the competitive position in core offerings as well as helping improve margins and acquiring additional capabilities and technologies. In the year under review, SIX announced three targeted acquisitions, two of which were in the financial information business and one in the post-trading area. 

Company Wide

  • Completed organizational integration of BME, progressed on its technical integration
  • Improved financial flexibility by additional bond issuances, including first digital bond
  • Successfully executed on company-wide efficiency program, further increasing the company’s productivity

Exchanges

  • Five IPOs in Switzerland, including the first SPAC
  • Three IPOs in Spain, 16 new listings in BME Growth segment
  • Launched new SME market segment Sparks
  • Received regulatory approval for SDX
  • Achieved record-year for products with crypto currencies as underlying

Securities Services

  • Record volumes recorded on Swiss repo market
  • Further expanded global reach in the custody business with new legal entities in Singapore and the US
  • Established new client relationships with Greek and Italian central securities depository (CSD)
  • Signed acquisition of European trade repository Regis-TR

Financial Information

  • Launch of new indices (such as ESG indices) in Switzerland and abroad
  • Expanding ESG and alternative data offerings
  • Acquisition of ESG data provider Orenda as well as index and ETF data specialist Ultumus
  • Continued growth in tax and regulatory product segments

Banking Services

  • Further developed open banking platform bLink, by also venturing further into API-based business models
  • Continued growth of eBill platform, reaching over 50 million transactions in 2021 (+27% YoY)
  • Continued growth in cashless payments, registering over 1 billion debit card transactions in 2021 (+11% YoY)

Non-operating Result Substantially Impacted by One-Off Effects
Despite the improved operating result, EBIT and group net profit substantially decreased compared to the previous year. This was due to two opposing effects from the stake of SIX in Worldline in 2020 and 2021.

In 2020, a partial sale of Worldline shares held by SIX as well as the merger of Worldline with payment services provider Ingenico had a highly positive effect on the 2020 net financial result, increasing earnings before interest and tax (EBIT) and group net profit. In 2021, an impairment resulting from the announced sale of Worldline’s Terminals, Solutions & Services (“TSS”) business negatively affected the share of profit and loss of associates of SIX (CHF -102.1 million). Compared to the highly positive result of the previous year, EBIT and group net profit saw a strong year-on-year deviation: EBIT amounted to CHF 147.2 million (-71.4%) and group net profit resulted to CHF 73.5 million (-83.2%).

Without the Worldline-related effects, Group net profit rose 37.3% compared to the previous year.

Dividend
For 2021, the Board of Directors recommends that the Annual General Meeting approve an ordinary dividend of CHF 4.75 per share (prior year: CHF 4.30).

Financial and Business Outlook     

SIX continues to pursue its business growth strategy. This will allow SIX to expand its stable infrastructure, to set up new digital infrastructures, and to invest in the security of its systems. Growth is also a prerequisite for successfully operating a platform business. As volumes increase, economies of scale reduce unit costs. By lowering transaction costs within networks and creating new recurring added value for its customers, SIX stays competitive.

For the 2022-2024 horizon, SIX aims to increase its revenues by more than 4% per annum while also realizing efficiency gains and cost reductions. The resulting increase in profitability will further improve the financial flexibility of SIX, ensuring sufficient financing for continuous investments to grow the business and further strengthen the competitiveness of the Swiss and Spanish financial centres.

Revenue increases will come from new services and synergies as a result of the BME acquisition and from leveraging the market position of SIX in the financial information business, particularly by leveraging the acquisitions made in 2021.

Further, SIX will continue innovating to bring new products and services to market, but will also expand its existing offerings by entering adjacent markets. The increase in top-line growth will lead to increased profitability given the extensive fixed costs that are associated with some core business activities of SIX.

Download the Annual Report

The publication provides a full report on the performance of the business units of SIX and outlines the ongoing efforts of SIX in providing the financial sector with innovative products and services.

Key Figures of SIX

CHF million 2021 2020 Change in %
Income statement      
Total operating income 1’498.3 1’375.9 8.9%
Total operating expenses -1’076.6 -1’008.6 6.7%
Earnings before interest, tax, depreciation and amortization (EBITDA) 421.7 367.3 14.8%
Depreciation, amortization and impairment -173.6 -141.9 22.4%
Net financial result 1.3 273.8 -99.5%
Share of profit or loss of associates and joint ventures -102.1 15.7 n/a
Earnings before interest and tax (EBIT) 147.2 515.0 -71.4%
Net interest and tax expenses -73.7 -76.7 -3.9%
Group net profit 73.5 438.2 -83.2%
Cash flow statement 2021 2020 Change in %
Cash flow from operating activities 375.8 -161.8 n/a
Cash flow from investing activities -154.4 1’870.4 n/a
Cash flow from financing activities 184.5 752.5 -75.5%
       
Balance sheet as at 31/12      
Total assets 17’983.4 18’399.5 -2.3%
Total liabilities 12’771.0 13’144.4 -2.8%
Total equity 5’212.3 5’255.1 -0.8%
Net debt to EBITDA (average)1 1.57 2.00 -0.42
Equity ratio (average)2 71.6% 76.0% -4.4 pp
Return on equity (average)3 1.4% 8.9% -7.5 pp
       
Shareholders' key figures      
Earnings per share (in CHF) 3.91 23.18 -83.1%
Ordinary dividend paid per share (in CHF) 4.75 4.30 10.5%
Payout ratio (adjusted)4 53% 65% -12 pp
       
Operating key figures      
Workforce as at 31/12 (full-time equivalents, in number) 3’685.1 3’528.7 4.4%
Workforce as at 31/12 (headcount, in number) 3’826 3’665 4.4%
Swiss stock exchange trading turnover (in CHF billion) 1’281.6 1’752.4 -26.9%
Spanish stock exchange trading turnover (Equities only, in EUR billion) 379.5 429.7 -11.7%
Market share of Swiss Equities (average Q4) 70.2% 100.0% -29.8 pp
Market share of Spanish Equities (average Q4) 62.5% 64.3% -1.8 pp
Swiss deposit volume (average, in CHF billion) 4’079.7 3’522.9 15.8%
Spanish deposit volume (average, in EUR billion) 2’494.2 2’300.2 8.4%
Number of SIC transactions (in 1,000) 893’533 728’330 22.7%
Number of delivered financial instruments (business unit Financial Information, in million) 1’788.0 1’634.0 9.4%

1 Net debt to EBITDA = net debt / adjusted EBITDA previous 12 months

2 Equity ratio = average equity previous 12 months / (average adjusted liabilities previous 12 months + average equity previous 12 months).
  The adjustments of the liabilities include the positions "payables from clearing & settlement" and "negative replacement values from clearing & settlement".

3 Return on equity = profit previous 12 months / average equity previous 12 months.

4 According to the dividend policy, the dividend distribution is based on the reported Group net profit without any effects in the context of the participation in Worldline.

Links to Business Unit Performances

Any questions?

Please do not hesitate to contact Jürg Schneider.

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About SIX
SIX provides and operates stable and efficient infrastructure for the Swiss and Spanish financial centers, thus ensuring access to the capital markets and the flow of information and money between financial market players. As a global provider of financial information, SIX delivers high-quality reference, pricing, corporate actions, and ESG data and provides regulatory services and indices to clients around the world. The company is owned by its users (more than 120 banks) with a workforce of 4,160 employees and a presence in 19 countries.
www.six-group.com

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