Toronto Stock Exchange operator TMX's profit falls 8 percent
TORONTO (Reuters) - The operator of the Toronto Stock Exchange, TMX Group Ltd (X.TO: Quote), posted a 8.2 percent decline in first-quarter profit on Monday, missing analyst estimates, due to low commodity prices and higher expenses.
Operating expenses in the quarter rose 13 percent to $118 million, driven mainly by a charge related to headcount reductions.
The company expects the headcount reductions to generate ongoing cost savings of about $4.3 million annually.
The Toronto-based company said it had net profit attributable to shareholders of C$42.6 million ($35.22 million), or 78 Canadian cents per share, compared with a profit of C$46.4 million, or 86 Canadian cents per share, a year earlier.
Excluding one-time items, the company earned 91 Canadian cents per share. On that basis, analysts on average expected TMX to earn 97 Canadian cents a share, according to Thomson Reuters I/B/E/S.
TMX has suffered along with its resource-based issuers on the sharp decline in commodity prices. It also faces competition from the new Aequitas Neo exchange that is seeking market share with lower fees.
In response to Aequitas, TMX last week said it would gradually reduce its rebate and fee structure to address concerns about its incentives model.
Revenue rose about 2 percent to C$185.3 million.
The company's shares closed at $55.16 on Monday on the Toronto Stock Exchange, up 0.29 percent. Continued...