Earnings call transcript: Warsaw Stock Exchange Q1 2025 sees record revenues

The Warsaw Stock Exchange (WSE) reported a robust performance for the first quarter of 2025, with record revenues reaching 132 million zlotys, marking a 12% increase year-over-year. The company also saw a significant boost in net consolidated profit, which rose by 28% to over 50 million zlotys. The stock price of Gielda Papierow Wartosciowych w Warszawie SA, trading under the symbol GPW, increased by 1.08% following the announcement, closing at 50.85 zlotys. According to InvestingPro data, the stock is trading near its Fair Value, with a strong YTD return of 25.71% and an impressive dividend yield of 6.19%.

Key Takeaways

• Record high revenues of 132 million zlotys, a 12% increase YoY.
• Net consolidated profit surged by 28% to over 50 million zlotys.
• The company plans to introduce a Bitcoin ETF and a dividend ETF this year.
• Stock price rose by 1.08% post-earnings announcement.
• Positive outlook with expected revenue growth between 6-8%.

Company Performance

The Warsaw Stock Exchange demonstrated strong performance across its financial and commodity market segments, with revenues growing by 15% and 9% YoY, respectively. The company maintained its position as a leading European exchange in turnover growth, further solidifying its competitive edge in liquidity and cash equity turnover. InvestingPro analysis reveals the company’s exceptional financial health with a current ratio of 4.52 and minimal debt, scoring "Good" on overall financial health metrics. InvestingPro subscribers have access to over 30 additional financial metrics and exclusive insights about WSE’s performance.

Financial Highlights

• Revenue: 132 million zlotys, up 12% YoY
• EBITDA: 55 million zlotys, a 25% increase
• Net Profit: Over 50 million zlotys, up 28%
• Cost Income Ratio: Improved to below 66%
• Operating Expenses: Grew 5.3% YoY

Outlook & Guidance

The Warsaw Stock Exchange remains optimistic about its future prospects, anticipating continued high activity in cash equities and a growing gas market due to its increasing role in Poland’s energy mix. The company expects capital expenditures to rise in 2025 due to investments in a new trading platform and accounting system, with potential revenue growth projected between 6-8%. InvestingPro data supports this outlook, highlighting the company’s 15-year track record of consistent dividend payments and strong return on assets of 11.78%. For detailed analysis and comprehensive valuation metrics, investors can access the exclusive Pro Research Report available on InvestingPro.

Executive Commentary

Thomas, CEO of the Warsaw Stock Exchange, highlighted the company’s achievements, stating, "We are number one market with a 43% increase year to date in MSCI Poland." He also expressed optimism about the IPO market, anticipating increased activity over the next two quarters. Piotr Lisbon, CEO of the Commodity Exchange, emphasized the growing role of gas in Poland’s energy transition.

Risks and Challenges

• Potential increase in operating costs due to new platform implementations.
• Market volatility affecting cash equity turnover.
• Regulatory changes impacting the introduction of new financial products.
• Economic uncertainties that could affect investor sentiment.

Q&A

During the earnings call, analysts inquired about the growth prospects of the gas market and the company’s strategies for navigating accounting policy changes. The management also discussed potential areas for additional investment, including business development, new products, and marketing initiatives.

Full transcript - Gielda Papierow Wartosciowych w Warszawie SA (GPW) Q1 2025:

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Good afternoon, and good morning, everyone, and welcome to Warsaw Stock Exchange q one twenty twenty five results call. Let me introduce today’s speakers. We have with us the CEO, boss of Soft Exchange, Ramos Przywowski. We have our CFO, Marcin Ravinsky, and also the CEO of Commodity Exchange, Piotr Lisbon. And I’m Michal Kuzubinski, head

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: of strategy and investor relations.

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: You will have an opportunity to ask questions after a short presentation. If you would like to ask a question and you’ve dialed in, at least press 2 on your telephone keypad to enter the queue. Or if you’ve joined us online, you can either type your question in the box provided or request to ask a voice voice question. And now without further ado, let me pass the line to Thomas.

Thomas, CEO, Warsaw Stock Exchange: Hello, everybody, and welcome on our first q earnings call. We have been proud to say that first quarter of twenty twenty five was a record quarter in many in many areas. First, we have delivered record high revenues of the group, which amounted to 132,000,000. Was an increase of almost 12% on year over year basis. And this block was driven by a exceptional performance of our financial market segment with revenue growing by almost 15% year over year, but also with the solid performance oncology segment with revenue growing by 9% year on year.

The growth in financial segment was supported and driven by cash equity turnover. The cash equity turnover went up by 35% during the first quarter and also was supported by record high performance of of our main indices, which went up by over 20% year to date in the first quarter. And you will see also this good performance continued in the second quarter so far. In the first quarter, we had a good cost control. Operating cost in the group went up by 5% year on year, which resulted in the decline in cost income ratio to below 66% from almost 7% a year ago.

You may notice a change in accounting treatment of a a fee to Polish financial supervisor. Now, Poli, previously in the previous year, we booked the total fee in the first quarter. And now we evenly distributed the you will evenly distribute the fee across all quarters. We obviously have adjusted the cost of in the previous year, so you’ll see them on comparable basis. In terms of the growth of EBITDA, we reported over 25% growth in EBITDA to four almost fifty fifty five million slaughters, and our net consolidated net profit jumped by 28% to over 50,000,000 slaughters.

Few weeks ago, a board recommended a to pay a dividend of $132,000,000, which represent 89% of the consolidated net profit line, and it translates into 3.15% per share, a 5% increase on year on year basis. The dividend will be voted on our upcoming shareholder meeting in June. In April, in terms of corporate events, we would like to know that in April, the our supervisor board has appointed mister Donnica Ivanovska Chieska as a member of the board responsible for legal regulatory affairs. Talking about what was driving our main engine of growth in the first quarter, I. E, turnover and cash cash equities.

You’ll see here that in on euro terms, the turnover was up 38% year over year basis, and we’ve been a leading European exchange in terms of turnover growth. We’re also proud to say that we are a leading exchange in Europe in terms of liquidity measured by those ratio, I. E, the turnover to market cap. Our our balance ratio amounted to 56% in the first quarter, which is a significant improvement compared to 40% in the fourth quarter of last year. And here we show the performance of our main indices year to date.

You will see that the bull market rally has continued in April and so far in May with our main indices going up by over 30%, not our coverage attempts. And we point out that this rally is not only limited to blue chips to big 20 index companies, but also right now, we also see growth in stock prices in mid and small cap segment. Our mid peak and small cap indices are also joining the rally. And to see here that also help with the help of a stronger currency, We are number one market with 43% increase year to date in MSCI Poland. And we also point out that even despite such such a exceptional performance, the evaluation of the market looks still relatively undemanding with over 25% discount to MSCI emerging markets on a one year forward PE basis.

Let me now comment on the performance in the primary market. In the first quarter, we saw the continuation of of a breakthrough on the IPO side with IPO of a health care diagnostic services provider, Dagnostica, worth $1,700,000,000. The EOS, we especially wanted to say that we are very happy with the aftermarket performance of diagnostic app. The stock is up over 60% year to the day since the IPO price. We hope that the more activity on the primary market will be usable in coming quarters in those equities.

And also for our bond segment, we are pleased to see a 40% over 40% increase in the value of bonds introduced to our catalyst market, improvement

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: in

Thomas, CEO, Warsaw Stock Exchange: the corporate segment, still quite solid value of issuance in the of the municipal bonds and also a big improvement in the value of the secured mortgage bonds. Here, we expect a continuation of those increases going forward. And as I said, we expect a more active IPO market over the next two quarters, especially in the upcoming season. I would now pass to Martin, to our CFO, to discuss in detail our financial results in the first quarter. Okay.

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Good morning, and good afternoon to all. As Thomas said, it was a very solid, very good quarter, and we are very happy about the performance. The revenues went up 12%, and it was both due to financial market and exceptional performance as well as commodity market. Details will follow in the next few slides, so let me stop here. In terms of operating expenses, also, we are very pleased with 5.3% growth rate compared to Q1 twenty twenty four.

It shows good control over over operating cost, and it’s in line with our expectations. Technically, we changed the the approach to recognition of financial supervisor authority fee. That is the annual fee, and, historically, it used to be booked q one in the whole amount. Whereas from January 2025, we’ll we’ll start recognizing it in a monthly installment of the whole year to reflect the nature of this of this cost. All data in this presentation, including historical numbers, has been calculated accordingly, and this is presented in comparable in comparable form.

So due to very dynamic growth in revenues and then the reasonable growth in in operating expenses, we can see that our operating performance was was very good, and operating profit went up 28 and reached 46,000,000 slots in q in q one twenty five. EBITDA went up almost 26% and reached almost 55,000,000. What happened below operating profit line, better performance from financial activity due to lower financial cost mainly. And, also, we had significantly higher share in the profits of our associated companies. And here, we we mainly report the depository profits, and they were much better in q one twenty twenty five than the year before, mainly because of also very dynamic revenue growth with together with good control over operating costs.

So at the end, more than 10,000,000 as well as contributed from the depository for our net results. At the end, our net profit for the period was over 50,000,000 and went up 28% compared to the the same quarter of last year. So, again, very solid, very, very good results, and and we are happy going to perform. A few words about revenues and revenue mix. Here, we present trends per segment.

And as we mentioned before, the most dynamic growth we observed in the financial markets where the revenue from financial market grew by almost 15%, mainly in the in the trading revenues from trading activities, and I will show details on the following slide. But, also, the commodity markets showed very good performance with more than 9% growth compared to q one twenty twenty four. As a result of this, we see a slight change in in our share of revenue, which is not dependent on turnover. In q one twenty twenty five, it was 32.4%, and it went down by 1.5 percentage points compared to to last year. Speaking about trading activity in the financial market, that was that that is, let’s say, the biggest part of our financial market segment revenue.

And you can see that in q one twenty five, it went up to 56,400,000 slots. And the most dynamic growth was within the equity part of of the trading activity, and it was following the record high turnover that we that we had in equities in q one twenty twenty five. It exceeded 111,000,000 slots in q one only. It was 35% higher than the year before. And following this, had almost 29% growth in revenues from from equities.

In other classes of assets, we had small a small decline in the stable revenue from debt and and and other. In other areas of financial market segment, we saw reasonable growth in in both information services, listing revenues, and also in our stock exchange. Without getting much much to details, I I would say that in in in listing revenues, we saw a growth in both listing fees and also fees for introduction. And in Armenia, the growth is coming mainly from depository activity. Now a few words about commodity market.

I will ask, CEO of commodity and and stock exchange, to to comment on this one.

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: Thank you. Thank you. Revenues from the market trades on the commodity market in the first quarter reached 23.5 slots, which represents an increase of over 11% year on year and 30% quarter on quarter. Apart from the electricity, we recorded double digit revenue increase decreases in rich segment of fees for quarterly and year on year basis. The decrease in revenues on the energy market is mainly due to the lower trading volumes of the of the forward markets, which running without trading obligations more influenced by significant fluctuation in liquidity, which also translated into the lower contracting of yearly instruments in this period.

Natural gas trading in first quarter amounted to 39% in total, so increase over 40% year on year and 10% put on quarter. These spot markets had a large share in the higher trade trading volumes, reaching a record level of 12 terawatt hours, which is an increase of 77% year on year and over 25% quarter on quarter. So we are very happy with the activity of the gas market participants in the recent months and and and upward trend that we are also observing in the current quarter. Regarding the property rights market, we noted here on year increase in the trade of renewable energy property rights by over 30%, which should be connected to the increased obligation to redeem green certificates to 8.5% in 02/2025. In 02/2024, it was 5%.

Going next to the clearing

Marcin Ravinsky, CFO, Warsaw Stock Exchange: clearing and

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: shipment revenue, we recorded in the first quarter an increase year on year almost 9%, amounted to 13,200,000 slots slots, and these are due to the higher trading volumes and transactions that we need in our trading house. So all the transactions are which are executed on the DGE. We noted stable revenue revenues in the registers when comparing year on year basis. In quarterly comparison, we see an increase in revenues, but primarily related to the fact that rest generation in autumn and winter period is lower than in first quarter. And also trading companies and some large

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: I just discussed the customers are in

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: the process of purchasing green certificate and energy efficiency certificates in order to redeem them by June for the previous year.

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Okay. Now let’s let’s have a look at the operating expenses. And the the growth here was mainly driven by higher personnel expenses, which went which went up by 7.6% compared to q one twenty four. And two two main reasons for that. The first reason is that the number of FTEs in the group went up by 13 full time employees.

And this growth is mainly coming from from the market company versus stock exchange where we strengthened the teams, mainly the teams which are involved in the IT related operations. And the other reason is we that we we booked higher provision for variable salaries in q one twenty twenty five as a result of better performance that we that we observed in the first quarter of of this year. So so two main reasons for for this growth. External services line, and here, we maintain more or less the trend that we observed already in previous quarters. So stable services in IT with a decline in advisory and other services in the in Q1 compared to the previous year.

What is also worth mentioning here is the growth in depreciation and amortization line, over 1,000,000 up here, and the reason is additional software solutions, which we implemented end of last year in in our commodity exchange. And, also, we started the amortization of the IP to our platform that is used by This is the platform for dynamic investment management. So the two new assets which we generated additional amortization compared to the previous year. Due to good cost control and and good revenue growth that we observed in the last quarter, you can see that cost income ratio went down to below 66%, and this is the lowest level for the last three years.

So we are we are very happy about it. But it’s fair to say that maintaining this growth rate in operating expenses in the following quarters may be a challenge. We already know about additional expenses, which we will have to incur in the in the remaining part of the year. And also related to big projects we are we are progressing with, including the work system and also the the accounting system that we’re implementing. Majority of costs around these systems are capitalized, but those which are not qualified for for capitalization incur our operating expenses.

So so we should expect higher growth rates in operating expenses in the coming quarters. That’s that’s the message. Capital expenditures. The number for q one twenty five seems high, 24,000,000 over 24,000,000 and and sixty two percent up compared to q one twenty four. But this is something that we expected, and we also communicated already in q four twenty four conference.

Because just to re to remind you, at the end of the year, we had a number of deliveries, especially of of IT related hardware, which were conducted before the end of the year, but were were not paid for. So, practically, we paid for these deliveries in the first weeks of twenty twenty five, and this is something that, let’s say, additionally increased capital expenditures for for equipment in the first quarter of twenty five. Intangible assets are pretty much in line with our expectations. And in in this line, you can you can also find part of cost related to what’s development, production platform development, which, let’s say, goes in line with our expectations. Looking at a longer longer perspective, when you compare ’24 to last twelve months ending in March 25, you can see right now the growth of 17% due to this higher CapEx in Q1.

However, it’s also fair to say that we expect the same trend in the remaining quarters of the year. So at the end, we expect that capital expenditures in 2025 should be significantly higher than in 2024. And a few words about liquidity and and cash flow. No surprises here in in in this this table, we also compare we’re also comparing the last twelve months ending March and the last full year. And in the in the LTM March 25, we had very strong operating cash flow of almost 160,000,000 slots, it represents more than 90% of our EBITDA.

So our cash conversion of of our result is is on pretty high level. We had slightly higher CapEx because of the the reasons that I mentioned on the previous slide. But still, even even after deducting this high CapEx, our free cash flow remains higher better than in 2024 full year, and this is almost $9,093,000,000. Liquid assets on our balance sheet March were more than 455,000,000 slots, you know, so pretty pretty high number and pretty safe liquidity position. So it’s, let’s say, also supports our dividend planning.

About dividend, I will remind you on on this slide. So in April, the management board recommended distribution of 132,000,000 swaps from profit and and reserve capital to our shareholders. This translates to three results and 50 gross on per share, so 5% up year over year. And the dividend yield at the at the date of the announcement of 6.6%. This is a little bit more than we than we promised in our dividend policy because we we we are declaring basically 6080% of consolidated net profit to be distributed every year.

And here, you can see it’s almost 89%. But we also mentioned that when communicating the strategic development directions that in the years when we can afford it, we will we will try to exceed this 80% promise, and and this is this is the case. We proposed the dividend date for the July 3 and the payment date on August 6. The supervisory board positively reacted to our to our recommendation, and right now, we are waiting for the promotion of the of the shareholders.

Thomas, CEO, Warsaw Stock Exchange: Let me now comment on the outlook for the remaining quarters of this year. The outlook remains positive in terms of financial markets, cash equities. We still see, I think, the high activity in April due to increased volatility. Our turnover on our main market increased by almost 15%. And, also, we see that so far in May, in the May, the year only lost lost over 20% rate of turnover in cash equities.

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: In terms of quality market, let me pass to to to comment briefly about the outlook for the coming quarters. Sure. Having in mind that the gas in the energy mix in Poland is growing, the role of the gas is growing. So we expect that the market turnover should be going up. And we see in the in the our results in the first quarter.

So we we forecast that it it should go up for the further month of this of this year. And the second thing we should have in mind that the first and second quarter of of of each year is seasonal higher contracting and redemption of the green certificates, so it should be also noted in respect of the revenues of the second quarter. Thank

Thomas, CEO, Warsaw Stock Exchange: you, Piotr. In terms of operating costs, we’d expect higher year on year cost dynamics in coming quarters due to several factors. First, we have higher higher development spending, especially for the new trading platform, which will be launched on the November 10 this year. And secondly, to the new financial accounting system, which will launch a bit this year. And but also due to a base effect, just to remind you that we have started our production program in the second quarter of last year.

And so the the solar base of comparison. In terms of CapEx, we have already talked about that, that this year CapEx is expected to become higher than last year. This is mainly related to the the launch of the new training platform, and we will expect that in the in the following years, ’26 and and and so on the CapEx will decline to a more normal levels. And then, also, would like to point out and stress that we are quite positive in terms of midterm growth factors. We see a big focus and we we should be a a big beneficiary of those structural changes and structural positive trends.

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Thank you. And with that, we are ready to take questions.

Moderator: K. Thank you. Thank you very much. So just just a reminder on the question and answer section. If you would like to ask a voice question and you are connected via the telephone, please press 2 on your keypad.

That is 2. If you are connected via the web, you may also ask a voice question or send your question as a text. We we see our first voice question from Migol from Wood and Co. Please go ahead. Your line is now open.

Marcin Ravinsky, CFO, Warsaw Stock Exchange: Hi. Hi. Thank you. Congratulations on on strong results, and and thanks for for the presentation. I would like to start maybe with Tigi.

So two questions for for Piotr, if I may. Is there any particular reason why we are seeing record high turnover on the gas spot market? I also noticed that in April, forward transactions in gas were were very high. So if you can just provide some some color on this, it would be appreciated. Has this has this been, like, a consequence of any changes that you’ve you’ve implemented, or this is just, like, pure market function?

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Zero. You

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: you like to ask the second question, or you will will be answered in the first one?

Marcin Ravinsky, CFO, Warsaw Stock Exchange: No. If if you can answer, like, that that question, it’s it it will be Right.

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: So I I just mentioned in the just a couple minutes ago that our lens, because market is is is growing in Poland. We are we are expecting we are expecting I don’t know if you can you can you hear me well? I can, but I also

Marcin Ravinsky, CFO, Warsaw Stock Exchange: can hear myself typing. So, yeah, I don’t know. If you could Okay.

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: So the growing role of gas in the energy mix in Poland is is growing. So we this is the the first thing. So there are a lot of plans for creating new power plants based on the gas. As you as you may know, the the the basically, it it takes about three, four years to to to build the generation on basing that would base on the on the gas. So changing having in mind that the the the time of lifetime of the coal power plants are is pretty short now.

Within three, four, five years, they’ll be end of their lives. So the Polish government is is looking for some new new possibilities, and we found that the very good and stable production would be from the from the gas. So we we we see a lot of contracts that are our major gas company in Poland, Olin, is buying from the LNG. And that might be also those contracts would be could be sold on the Polish market,

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: on the

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: on DGE. So this is the case that so we we can see the growing numbers of trades on the forward electricity contracts, but also on the spot market, which is the we know that record on the on the spot market leveling amounting to 12 terawatt hours in the the first quarter. So it is because that is really good for for DTE and for the market and the competition is that for those power plants that would be basing or is are already basing on the on the gas market on the gas source, mostly they are contracting on the exchange, and mostly they are contracting on the spot. Because now we are introduced now we are at the time when renewable sources are are generated, the the power from renewable sources. So but basing on the weather conditions.

So when the sun is not shining and the the winter sorry. The wind is not blowing, then we need to have something instead. So we find that the gas is really good example of of of the source that could could be could be used. And most of the power plants are contracting on the on the gas market that we are running. So this is the the case that we we have bigger volumes, and we expect that the the the the volumes will be will stay with us and will be also higher in the in the future.

Mhmm.

Marcin Ravinsky, CFO, Warsaw Stock Exchange: Okay. Thank you. Also, in terms of revenues from property rights, would you say this is close to the run rate for the next quarters?

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: Yes. I I mentioned that that the second quarter is the time of redemption of the green and efficiency certificates. So it’s seasonal that the second quarter is usually in the revenues and in also in in the volumes. So I expect that second quarter will be as good as the last year or even more because we already have the obligation to for redemption of those green certificates a little bit higher than it was last year. So I expect that it will be also bigger volumes and also revenues coming up of those units.

Marcin Ravinsky, CFO, Warsaw Stock Exchange: Right. And and and for the the second half of the year, like, do you do you see q one as sort of, like, the the run rate for those quarters?

Piotr Lisbon, CEO of Commodity Exchange, Warsaw Stock Exchange: As as I said, the second one will be the biggest one probably because because of the period of the of the redemption. However, in in terms of trading, I expect that the volumes should be bigger than last year because of the obligation. The in 02/2024, the obligation to redeem the green certificate was at the level of 5%. For 02/2025, the level was increased to 8.5%. So it we expect that the volumes should be higher than in last year.

Marcin Ravinsky, CFO, Warsaw Stock Exchange: Got it. Got it. Thanks a lot. Now maybe in terms of of OpEx, just general question. Like, where would you where would you say the yearly increase would land for 02/2025?

I I understand that moving forward, it’s going to be a bit higher growth in the the next quarters. So on a on a yearly basis, where where would you see that OpEx is landing?

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Let me take this one. I think, you know, in our in our strategic direction that we call that we announced end of last year, we we find that our annual growth in OpEx should not exceed 6% in the period of three years, which were covered by this analysis. And I think we should maintain it. Yes? We don’t have any other reasons

However, I think 2025 can be the most challenging of the three years. Yes? So I would say that in the three year period, we should still maintain speak to this four to 6% growth rate that we assumed. But but in 2025, we have we have our challenges, as we mentioned. There’s maybe one more thing to consider here because in the same document, we also and all that that our expected revenue growth rate is between 68%.

Of course, we have limited control over it. Yes? So if if our revenues allow us to spend a little bit more, I think we have good ideas how to invest in the in the development of our business and how to, let’s say, maybe stimulate further growth in the future. So depending on revenues, we may also, in a controlled way, decide to increase the the operating costs and invest in the in the business development.

Marcin Ravinsky, CFO, Warsaw Stock Exchange: Got it. Great. Thanks a lot. And and where where, like, in which areas of the business would you consider spending a bit more if revenues allow?

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: I think we should we should consider investing a bit more in in business development, creating new products, also, and maybe promotion and marketing around the Russell Stock Exchange. So these are the areas where where I can I can see potential to to invest? And, of course, we’ll we’ll still maintain investing in IT related teams and then services. This is where we where we see also they need to to increase spending at least at least short term.

Marcin Ravinsky, CFO, Warsaw Stock Exchange: Mhmm. Okay. Thank thanks thanks so much. And just just one last question on this one a little bit more technical. But could you explain how the the change in accounting policy related to the KNF fee changed the income recognized and booked coming from KDPW?

Mhmm.

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Yeah. That’s that’s that’s actually a technical one, but but a valid one. Actually, the the deposits already, they were recognizing this fee over time already in the past. And for presenting consolidated numbers, we had to adjust their numbers to our policy. Okay?

So what they were recognizing over time, we were changing and recognized in in q one entirely. And now during due to the change in our policy, we had to consistently present their results. So we, let’s say, reversed what we what we did before. Yes. That’s that’s why that you can see that this line changed as well in our in our comparable data.

And looking for details of or detailed impact of these changes on our p and l, you can either refer to a separate slide, which we show in the appendix to this the appendix to this presentation. And we also have a dedicated note in our financial statement that describes the impact.

Marcin Ravinsky, CFO, Warsaw Stock Exchange: Okay. Understood. Thank you so much. That that’s all for me. Thanks, guys.

Moderator: Okay. Thank you. Thank you very much. Just another reminder for the rest of participants. If you would like to ask a voice question, please press star two on your keypad.

If you are connected via the web, you can also ask a voice question or send your question as a text. Our next question is a text question from Usma Olbayo from Netco Brazil. Could you provide insights on the expected IPO activity for this year? Please share an update on new ETF developments, including any plans related to rates and other products.

Thomas, CEO, Warsaw Stock Exchange: Of course, we are very happy with the extremely strong performance and aftermarket performance of the first IPO we had this year, Diagnostica, with the share price up over 60% and also the record high level of our indices. And so far this year, most of our research is the best performing market in the world. And, of course, this draws attention of potential issuers. We hope to that the IPO market will therefore be more active over next few quarters. We’d expect one medium sized IPO in this quarter and then several other IPOs, including hopefully a few larger ones by the end of this year.

But I also like to say that we are much more active right now in terms of contacts with potential issuers with the contacts and and our initiatives related to private equity funds and buy use candidates, which might think about least income to IPOs on the loss of foreign exchange.

Moderator: Okay. Thank you very much.

Thomas, CEO, Warsaw Stock Exchange: Yes. So ETFs, we now have 13 ETFs listed on the on the market. We expect the new ETFs to to come to market over, you know, over next few months. Here, in particular, we are we have high hopes with the dividend ETF, which is based on our index of highest dividend bank companies, which will pay a cash dividend on quarterly basis. And we think that this could be very, very attractive for especially for retail investors.

We have heard from our ETF providers with our plans to introduce some other ETFs, including the ETF on Bitcoin, which would expect to be launched this year.

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Is also asking about any plans related to

Thomas, CEO, Warsaw Stock Exchange: REITs. we understand from various public statements by the government representatives that the legislation on list may be finalized this year. If so, we would expect first IPO of reach next year on the most of the exchange.

Moderator: Okay. Thank you. Thank you very much. Just a final reminder, if you would like to ask a voice question, please press star two on your keypad. If you’re connected via the web, you may also ask a voice question or send your question as a text.

And just give a a moment or so for any other questions to come in.

Michal Kuzubinski, Head of Strategy and Investor Relations, Warsaw Stock Exchange: Well, if there are no other questions, then thank you everybody for for joining the call. Thank you for listening. Thank you for your participation, and we are looking forward to speak to you again during our q two results call in the summer. In the meantime, if you have any questions, please don’t hesitate to reach us reach out to us in for stock exchange investor relations team. Thank you, and goodbye.

Thank you. Thank you.

Moderator: Thank you. We are now closing all the lines.

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