NZX stresses growth opportunities amid rising people costs
NZX chief executive Mark Peterson
Any business has a certain amount of fixed costs that it incurs, regardless of how much trading it does.
Some expenses can grow as revenue grows and these are the kind of costs most businesses scrutinise rigorously when trading turns down, but there's a limit to how much costs can be cut without damaging the company's ability to operate.
With stock exchange operator NZX asking its shareholders for a $215,000 hike in its directors’ fees pool to $779,000, a more than 38% increase, it isn't surprising NZX's costs versus revenue have come under scrutiny.
Chief executive Mark Peterson told Thursday's annual shareholders' meeting that the exchange's core trading and clearing volumes were down 9.7% in calendar 2023 to their lowest level in nine years.
“Value traded is a key earnings driver for the company, so we did face a considerable earnings headwind in 2023,” Peterson told the meeting.