ASX Ltd (ASX:ASX) share price sneezes despite robust first-half results as CEO says sayonara

The CEO's retirement plans may have cast a shadow over the exchange's latest earnings report.

| More on:
A man sitting at his dining table looks at his laptop and ponders the CSL balance sheet and the value of CSL shares today

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Key points

  • The ASX share price is taking a trip to the downside amid its first-half results today
  • Most operational metrics indicated robust growth for the exchange operator
  • CEO, Dominic Stevens, announced his plans to retire from the company this year

The ASX Ltd (ASX: ASX) share price is coming under pressure today as investors thumb through the exchange operator's latest half-year numbers.

Shares in ASX Ltd opened at $86.02, a slight decrease from its previous close. The ASX share price has since remained mostly on a downwards trajectory and is now trading 5.1% lower at $82.29.

ASX share price weakens on strengthening metrics

Highlights of the first-half report are as follows:

  • Operating revenue up 6.6% from prior corresponding period to $501.4 million
  • Earnings before interest and tax up 6% to $338.4 million
  • Net profit after tax (NPAT) increased 3.5% to $250.3 million
  • Interim dividend raised 3.5% to 116.4 cents per share fully-franked
  • All time record $90 billion of capital raised through the ASX in the first half
  • Second highest number of initial public offerings (IPO) on record at 150.

What else happened during the half?

While ASX Ltd revealed robust half-year results, the operational and financial metrics appear to be overshadowed by today's announcement of the CEO's retirement.

First, let's take a look at the numbers.

The ASX managed to deliver growth across revenue and earnings due, in part, to a solid half for listings activity. This involved a number of record, or near-record, figures across its listings segment. Notably, an all-time record of $90 billion was raised through the exchange during the period.

ActivityMetricChange
Total capital raised$90 billion11.24%
Number of IPOs15076.5%
Listings revenue$104.1 million17%
Average traded value per day$6.2 billion5.7%

During the half, the ASX received word from the Australian Securities and Investments Commission (ASIC). In November 2021, the corporate watchdog handed down conditions for the ASX to abide by following the abrupt outage in 2020. The ASX share price waned on the news.

According to today's release, the CHESS replacement system remains on track for deployment in April 2023. Upon launch, share settlement will be handled by blockchain technology using smart contracts.

ASX CEO makes a move for the door

Now, back to Dominic Stevens — ASX managing director and CEO — and his plans to retire. The departure could be behind the falling ASX share price today.

After six years as CEO, Stevens will make for the exit some time this year. During his tenure, the exchange operator has appreciated by roughly 60% in value.

Commenting on the announcement, ASX chair Damian Roche said:

Dominic is providing ample notice of his retirement plans for which we are grateful. This is typical of his foresight, and enables a smooth transition to the best possible successor at a time when ASX will be entering its next phase of growth and innovation.

A global search for his replacement is now underway.

ASX share price snapshot

Unfortunately for shareholders, the ASX share price has been baptised by fire in the new year. Currently, the company's shares are 10.8% off where they were at the end of last year.

However, investors who picked up ASX Ltd shares 12 months ago are now sitting on a 15% gain. The company now boasts a market capitalisation of $16.78 billion.

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Earnings Results

Two happy excited friends in euphoria mood after winning in a bet with a smartphone in hand.
Earnings Results

ASX 200 stock jumps 10% on strong FY24 results

How did this KFC restaurant operator perform in FY 2024?

Read more »

A male investor wearing a white shirt and blue suit jacket sits at his desk looking at his laptop with his hands to his chin, waiting in anticipation.
Consumer Staples & Discretionary Shares

Guess which ASX 200 stock just slashed its final dividend by 23%

This retailer had a tough time during the 12 months. Here's how it performed.

Read more »

Man jumps for joy in front of a background of a rising stocks graphic.
Earnings Results

Catapult shines: 20% sales growth propels ASX tech stock to new 52-week high

A strong annual result from this tech player has caught investor attention.

Read more »

A man in his 30s holds his laptop and operates it with his other hand as he has a look of pleasant surprise on his face as though he is learning something new or finding hidden value in something on the screen.
Earnings Results

Xero share price leaps 8% on staggering earnings upheaval

A major turnaround in profitability is sending investors into a frenzy over Xero shares today.

Read more »

a construction worker sits pensively at his desk with his arm propping up his chin as he looks at his laptop computer while wearing a hard hat and visibility vest in a bunker style construction shed.
Materials Shares

Which ASX 200 stock just plunged 12% despite record full-year earnings?

It looks like an impressive report card but UBS doesn't like the FY25 guidance.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Earnings Results

ASX 200 tech stock lifts off on another record-setting half-year profit

Investors are bidding up the ASX 200 tech company following its half-year results.

Read more »

increasing rural asx share price represented by happy looking sheep
Earnings Results

Why is this ASX All Ords stock staying strong as profits crash 76%

How is this company's share price marching higher after mowing down more than three-quarters of its profits compared to a…

Read more »

Two men sit side by side on a couch with video game controls in their hands and expressive looks on their faces as they react to the action in front of them in a home setting.
Earnings Results

Guess which ASX 200 stock is surging 11% on an 'outstanding' result

This ASX gaming giant just posted a 17% jump in profits, and its shareholders are basking in the glory.

Read more »