Canada exchange operator TMX posts profit, shares climb

Wed Feb 6, 2013 2:52pm EST
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By Alastair Sharp

TORONTO (Reuters) - TMX Group Ltd (X.TO: Quote), operator of the Toronto Stock Exchange, reported better-than-expected profit for the first full quarter since a group of Canadian financial institutions took control, even as sluggish trading and listing activity limited growth.

Shares rose as much as 4.2 percent to C$57.82, the highest level in the exchange operator's 10 years as a publicly traded company.

The takeover by the Maple consortium of Canadian banks, insurers and pension funds followed a failed offer from the London Stock Exchange Group Plc (LSE.L: Quote) for Canada's flagship market operator.

TMX's fourth-quarter profit came in at C$32.8 million, or 61 Canadian cents a share, for the three months ended December 31, the company said. Excluding one-time items related to the acquisition, TMX earned 95 Canadian cents a share.

Analysts had on average expected the company to earn 73 cents a share, according to Thomson Reuters I/B/E/S.

"Despite challenging industry conditions, the company has been able to produce solid earnings and solid cash flow," CIBC World Markets analyst Paul Holden said.

Fees for new listings dipped sharply on the junior TSX Venture Exchange, though the main Toronto Stock Exchange made up some of that ground with major initial public offerings for department store operator Hudson's Bay Co (HBC.TO: Quote) and miner Ivanplats Ltd IVP.TO.