Palestine Securities Exchange PSE IR presentation 2012 Feb, 2013 WWW. PEX .PS
Outlines • Growth Strategy • Growth Challenges • Achievements • PEX technical performance • Financial Performance • Our message
Growth Strategy • Strengthen market governance through improving our legislation, regulation, systems, operational procedures, information security, and internal audit mechanisms in keeping with best practice. • Enhance our relationship with the PCMA, member brokers, the listed companies and other stakeholders to provide premium timely responses to investor needs and market evolution. • Increase Market depth and expand our investor base, through: • Completing the listing of public shareholding companies, and continuing our educational outreach to qualified family-owned firms. • Including the exchange in the MENA frontier market indices such as those provided by MSCI, S&P and FTSE). • Encouraging Diaspora Palestinians to invest in Palestinian listed companies. • Further enhance our continued outreach campaigns and road shows towards promoting PEX to institutional and retail investors (local and regional). • Diversify our sources of income, through: • Expansion of our central depository services. • Developing better data dissemination channels and building an online trading and companies database. • Strengthen our relationship with regional and international markets, and to obtain full membership of the World Federation of Exchanges (WFE). • Promote the development of effective, best practices for corporate governance and investor relations in Palestinian companies.
Growth Challenges • Political conditions and future uncertainty are the main challenges the Palestine investment environment is facing. Any positive political move will have an immediate impact on the Palestinian economy. • The PNA financial crisis and its inability to fulfill its financial obligations toward its employees and the private sector. • The new tax law which has a direct negative impact on the investment environment in Palestine. • Strong competition with other regional stock markets like Jordan, Egypt & the UAE, since many local investors are active in those markets. • The psychological impact of the international financial crisis the economic difficulties in some EU countries. These left negative impact on foreign and local investors and the PEX as well.
Achievements of 2012 • Listing of the Palestine Securities Exchange (PSE) on the Palestine exchange, adhering to best practices in this respect. The PSE is the second Arab Bourse to be listed. • Listing of two public shareholding companies , raising the number of listed companies to 48. • Launching PSE Investor relations section. • Raising the CDS revenues by 21% compared to 2011. • Obtaining full membership of the Association of National Numbering Agencies (ANNA). • Signed MoU with the PMA to enable the CDS to do cash settlements via the National Real Time Gross Settlement (RTGS) system. • Acknowledging the CDS as a legal entity Identifier for Palestine companies by ANNA. • Launched the Palestine Chapter of Middle East-Investor relations society. • Holding the Sixth annual Capital Market Forum “ Brokerage industry: current challenges and future prospects”. • Concluding the last stages of the electronic disclosure system “IFSAH”. to operate in April 2013, beside other technological projects to enhance PEX infrastructure. • Adopting the strategic decision to develop PEX core systems locally. • Achieving second place in the classification of King Worldwide Digital Corporate for Investor Relations pages among Palestine listed companies. • Enhancing PEX rules & regulations through several legislations specially the new Listing Rules.
Arab Exchanges Arab exchanges performance varied due to political and economic conditions in each country and the extent of influence of the financial and political circumstances in the region and the world.
PEX Capitalization 2.76%
PEX Performance During 2012, Pex operating performance was below expectations due to Palestine political and economic conditions. Most of the world stock markets suffered from the political & economic conditions during 2012,The exchanges of the EAME region members of the WFE lost -24.10% of their traded values and -12.60% of the transaction number during 2012 compared to 2011, according to the WFE statistics. -25.22% -25.52% -33%
Al Quds Index Al Quds index reflects a signal of stability closing at 0.14% high compared to 2011.
Revenues & Expenses Operating Rev. -25.05% -19.32% -0.8% -35.17% -47.28% 25.63% Comparing Expenses 2011-2012 Expenses 0.76% -1.50% -0.97% 17.80%
Assets & Liabilities Assets -7.97% Liabilities -2.64%
Our message Palestine political & economic conditions were reflected in PEX trading volumes, declined 25% compared to 2011, and impacted our financial performance. Despite our performance in 2012, we still believe in our solid overall financial position and our ability to grow in the light of better conditions of Palestine. We Hope that the new coming year 2013 will hold within its folds more stable economic and political conditions for Palestine, the Arab region and the whole world.
Contacts Palestine Securities Exchange plc, Mohammad Khraim Head of Investor Relations Section • Fourth Floor, Trust Building, Amman street-Nablus • P.O Box 128, Nablus-Palestine Tel: +970 (or 972) 9 2390 945 Fax: +970 (or 972) 9 2390 998 E-mail: IR @ pex.ps