Exchange's losses soar to €15.5m as sales tumble
THE Irish Stock Exchange's losses rocketed last year as investments soured and fewer hedge funds and other investment vehicles listed on the 216-year-old exchange following a series of scandals.
The stock exchange's pre-tax loss jumped to €15.5m from a loss of €299,000 in 2007 as investment losses doubled to €22.1m and sales tumbled 21pc to €24m. Operating profit slumped 39pc to €6.6m. The outside advisor who manages the investment funds on behalf of the exchange is now looking to expand overseas following the slump in fund values.
The Dublin exchange is known for its household names, which are listed on the primary exchange, but the exchange's most lucrative work is the little- known listed funds and international securities business which has recently been hit by a series of problems.
Britain's Serious Fraud Office arrested two people last month in connection with the collapse of Dublin-listed Weavering Macro Fixed Income Fund, which went into administration in March. German bank Sachsen LB had to be taken over after its Dublin-listed fund Ormond Quay sprung a leak in 2007 that required a €17.3bn bailout.
"Investment losses reflect the generally poor performance of equity markets during 2008," stock exchange chief executive Deirdre Somers said yesterday.
"While all financial markets continued to be volatile in the early part of 2009, we expect international structured product markets, which are key to our financial performance, to recover somewhat in the latter half of the year," she added.
New listings of investment funds tumbled 31pc last year while new debt securitisations slid 47pc. Exchange spokeswoman Ailish Byrne said the exchange believes it maintained market share internationally despite those dramatic slides in the exchange's most important business.
This year Anglo Irish Bank delisted after it was nationalised. It was followed by Arklow-based bathroom ceramics manufacturer Qualceram Shires. Last year technology companies Iona and Horizon left while food company Arzyta dropped its primary Irish listing although its shares are still traded in Dublin.
The stock exchange employs 92 people who are paid an average of €98,000 when pensions and employer contributions are taken into account, according to the company's accounts.
News of the huge losses will be a blow to the seven Dublin stockbrokers who together own the exchange -- Davy, Goodbody, NCB, Dolmen, Bloxham, ABN Amro and O'Connor Campbell.