Gielda Papierow Wartosciowych w Warszawie SA

WSE:GPW

Earnings Call Analysis

Solid Growth and Strategic Initiatives from Warsaw Stock Exchange Q3 2024

In Q3 2024, the Warsaw Stock Exchange Group reported a 6% year-on-year revenue growth, driven by a 9% increase in the financial market. Operating expenses rose by 3.9%, improving the cost/income ratio to 69%. EBITDA increased 7.2%, with net profit up nearly 6%. Turnover surged 35% year-on-year, positioning it as one of Europe’s fastest-growing exchanges. The notable IPO of the ZabKa Group worth PLN 6.5 billion reflects confidence in the market. Looking ahead, the Group aims for increased efficiency with new strategies set to be unveiled before Christmas and anticipates higher capex in Q4 to support growth initiatives.

Strong Revenue Growth with Controlled Expenses

In the third quarter of 2024, the Warsaw Stock Exchange (WSE) reported a revenue increase of 6% year-on-year, primarily driven by the financial market, which saw a 9% uptick. This growth reflects a solid demand for trading and information services. Operating expenses rose modestly by 3.9%, leading to an improved cost-to-income ratio, which decreased by 0.5 percentage points to 69%. This marks the second consecutive quarter where revenue growth outpaced expense growth, enhancing profit margins. The management team attributes part of this success to an ongoing cost optimization program begun in the previous quarter.

Improved Profitability Metrics

Earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter stood at €42.5 million, reflecting a 7.2% year-on-year improvement, translating to an EBITDA margin of 37.9%. The net profit attributable to equity holders rose nearly 6%. The management expressed optimism in maintaining these profitability levels while controlling costs effectively going forward.

Market Activity and Growth Dynamics

The WSE excelled in market activity, showcasing a 35% year-on-year growth in turnover, making it the second-best performing market in Europe by this metric. The equity turnover in Zloty saw a robust 29% increase year-on-year, propelling revenue from equity trades up by 13% to nearly €33 million. The uptake in trading activity is partly attributed to a notable surge in initial public offerings (IPOs), particularly the landmark IPO of the ZabKa Group, valued at PLN 6.5 billion, which significantly boosted market liquidity in October.

Cost Management Strategy Showing Progress

Management highlighted that while employee costs increased by 4.2% overall, adjusted figures reflecting one-off costs indicated a steeper rise of 7.4%. External service charges grew by just 4%. Continued efforts to optimize costs resulted in a strategic redirection of investments towards more effective areas, which should support profitability further in the coming quarters. Nonetheless, a 6% increase in the salary pool was implemented in October to address inflation, suggesting a cautious outlook on employee-related expenses in Q4.

CapEx and Future Investment Plans

Capital expenditures (CapEx) for Q3 were reported at PLN 13.7 million, down significantly year-on-year due to management restructuring and project reviews. However, the organization anticipates a surge in capital spending in Q4 to compensate for earlier delays, especially in developing IT infrastructure projects. There is an emphasis on keeping CapEx in line with revenue to ensure sustainable growth.

Liquidity Position and Cash Flow Strength

The WSE's liquidity position remains strong, with cash flows from operating activities over the last twelve months amounting to nearly PLN 145 million, representing close to 29% of EBITDA. The free cash flow increased by 20% year-on-year to nearly PLN 80 million, supported by lower CapEx. The current cash position is robust at PLN 350 million, allowing for agile responses to upcoming investment projects and reducing liquidity risk.

Future Growth: New Product Launches and Strategic Direction

The WSE management is focused on expanding its product offerings, particularly within the ETF segment, as part of its broader strategy to enhance market attractiveness. The company is promoting the introduction of new ETFs without exchange fees until the end of the year, part of an initiative to boost investor participation, especially in passive investment vehicles. As outlined by leadership, additional foreign ETFs are also expected to be introduced, alongside a fresh corporate strategy presentation anticipated before the year's end.

Earnings Call Transcript 2024-Q3

[Robert Stankiewicz, executive]

Good morning, and welcome to all our guests in the room on the trading floor and everyone following us online. This is the conference presenting the financial results of the GPW Group in Q3 2024. Let me introduce the host, the speakers, Tomasz Bardzilowski, President of the Warsaw Stock Exchange Management Board; Marcin Rulnicki, member of the Management Board of the Warsaw Stock Exchange; Piotr Listwon, President of the Management Board of [indiscernible] and Michal Kuzawinski, Director of Strategy and Investor Relations Department of the Warsaw Stock Exchange. My name is Robert Stankiewicz. I'm the Director of the Communication Marketing Department of the Warsaw Stock Exchange hosting this meeting once again.



Let's move on to the presentation of the results. Over to Tomasz Bardzilowski, President.

[Tomasz Bardzilowski, executive]

Good morning, and welcome to this conference dedicated to the results of the Warsaw Stock Exchange Group for Q3 2024. Q3 was yet another quarter of growing revenue at a rate faster than the growth in expenses. The revenue of the group grew by 6% year-on-year, driven by the financial market where revenue grew by more than 9% year-on-year, mainly driven by revenue from trading and revenue from information services.



On the commodity markets, we saw stabilization of revenue, which we believe is a good outcome given the shrinking revenue in -- from electricity trade, partly offset by growing turnover in natural gas.



Operating expenses grew by 3.9% or nearly 4% year-on-year. We are proud to say that this quarter was yet another quarter of a drop in the cost/income ratio, down by 0.5 percentage point to 69%. EBITDA grew 7.2% in Q3, while the net profit attributable to the equity holders of the parent entity grew by almost 6% with a lower net financial income combined with a higher share of profit of associates.



Moving on to the volumes and activity on the Polish and European markets. We are proud to say that once again, the Warsaw Stock Exchange is a top European market by growth in turnover in euro, up by 35% year-on-year on the Warsaw Stock Exchange, the second best growth in Europe. We are also proud to say that our velocity ratio remained high on the Warsaw Stock Exchange. Our liquidity -- the velocity ratio was 37% in Q3.



In the equity market, turnover in the zloty grew 29% year-on-year. Average fees dropped modestly mainly due to an increased share of HVP and HVF traders and market makers in equity turnover. The share grew to 34% from 32% a year earlier. Revenue from equity turnover grew by 13% year-on-year to almost EUR 33 million. Last year, we had high revenue from block trades. So the base effect means that the growth of turnover in EOB turnover was lower.



In the derivatives market, we saw stabilization of turnover in WIG 20 futures turnover and stabilization in revenue from these futures with a modest growth in volatility of indices, the HVP and AGF traders were less active last quarter. The total turnover in derivatives grew by more than 8% year-on-year, whereas revenue from derivatives trade grew almost 4% to PLN 4.5 million.



In the debt market, this was yet another quarter of high growth in turnover on treasury bond spot Poland, mainly driven by the fact that since April, we've had a new market participant of TBSP, the Ministry of Finance. This participant uses a temporary promotion on fees. So the growth in turnover does not really impact the revenue as much. The revenue grew 8% year-on-year to just under PLN 4 million in Q3 in the debt market.



Regarding transactions on the stock market, the SPOs, the IPOs, the ABBs, there was a strong pickup in Q3. In Q3 alone, SPOs and ABBs totaled more than PLN 5 billion as compared to under PLN 1 billion in Q3 '23. The most important development, the highlight of last week was the IPO of the ZabKa Group worth PLN 6.5 billion, one of the biggest IPOs in the history of the Warsaw Stock Exchange, the fourth biggest and also the fourth biggest IPO in Europe this year, which, of course, improved turnover in equities in October, equity turnover in ZabKa stock crossed PLN 3 billion, representing more than 11% of total EOB equity turnover on the Warsaw Stock Exchange in October.



We are proud to say that we quickly introduced additional instruments for investors, futures and certificates based on shares, which were traded several days after the IPO of ZabKa. ZabKa joined WIG 40 after the trading session on the 29 of October. And we hope that the IPO of the ZabKa Group will be a good incentive for other companies that might want to be floated on the stock exchange. We're hoping that at least one big IPO will take place later this year on the Warsaw Stock Exchange.



Turning over now to Piotr Listwon, President of TG.

[Piotr Listwon, executive]

Good morning. The commodity market in Q3 was marked by an increase in gas turnover and a decrease in electricity and property rights turnover. Let me move on to the different business lines of the [indiscernible] Energy.



In the electricity market, the turnover volume grew by more than 15% quarter-on-quarter to 33 terawatt hours. There was a small decrease, however, year-on-year as 2023 had record high turnover on the spot market. We are proud with the growth in turnover in electricity year-on-year by 8.5% quarter-on-quarter by 21%. This was mainly due to better liquidity of better turnover in annual contracts, the biggest volumes traded.



Last year, contracting was mostly based on short-term contracts. The most popular contracts perhaps were weekly contracts with lower volumes. So the volumes were lower. In Q3, we saw good results in the gas market in the spot and forward segments. The same 34 terawatt hours compared to the electricity market, 27% up year-on-year.



The volumes in Q3 increased, thanks to the domestic production of natural gas with expanding capacity in the energy and heat sector. For instance, recently, the Gryfino power plant was commissioned. RES property rights. Q3 was comparable to Q3 2023 for terawatt hours, the Quarter-on-quarter, the turnover dropped by 14% due to the end of the settlement period in Q2 and the expiry of the certificates of origin.



We are now presenting for the first time the results of another good business line guarantees of origin, 10 years now in business. We have 3,000 participants in this register now. This comes as a response to the ESG needs of electricity buyers. Entities which buy electricity need guarantees of origin of the electricity from renewable energy sources, which are environmentally friendly. In Q3, the register saw transactions of nearly 12 terawatt hours, up 26% year-on-year.



The next slide presents the revenue from our markets. As you can see, the revenue is stable at PLN 20 million, PLN 21 million per quarter. Quarter-on-quarter, we saw a positive impact on the gas and electricity markets, as mentioned by Mr. Bardzilowski in the beginning. However, the revenue from property rights were lower. The revenue grew 5% year-on-year. And we see stable revenue from clearing in our clearing house, a slight drop in Q3 due to lower clearing volumes on the spot electricity and property rights markets.



We are presenting the overall revenue from the operation of registers of the certificates and guarantees of Q3, those revenues -- the volumes rather on the register of certificates of origin dropped. However, we see a nice growth in volumes and revenue from the register of guarantees of origin, which grew 26% year-on-year, something we are very proud of.

[Marcin Rulnicki, executive]

Now let's turn to a number of slides which talk about our financials, starting with an overview of our P&L. In Q3, we've heard about the revenue from the previous speakers in detail. As regards to the expenses, we'll move to another slide, which talks about the expenses in great detail.



So here, let's look at the cumulative numbers year-to-date 9 months into 2024 with a 7% increase in revenue and a similar growth rate in operating expenses. The growth of revenue shows the same trends we just heard about, strong growth in the financial market and flattish revenue on the commodity market.



As regards the developments in the different lines under operating expenses, other expenses, GRC impairment in Q2, a one-off of EUR 6 million. As a result, the net profit and the operating profit for the period was hit and was lower year-on-year. But net of that one-off, we see a modest growth between 2% and 3%.



Let's move on to the expenses in Q3. I think this will be interesting to you when you look at the results. The key point for me is what we've heard about from Mr. Bardzilowski. The growth in expenses was below the growth rate of revenue for the second consecutive quarter, improving our profit margins. The cost optimization program we launched in Q2 is proving effective. It's important to say perhaps that many of the quick wins as regards cost savings and inefficiencies have already been implemented, but we still see some room to improve and optimize our costs as we look at our processes in detail and try to improve efficiency supported by IT tools on a daily basis. So we see the potential, but this may take some more time than the quick wins that we've already completed. Other than that, the direction is right, and we'll try to keep up this trend as long as possible.



The key lines of operating expenses, employee costs up by 4.2% compared to the growth in general salaries in the economy, this looks quite good, but this growth was driven by a number of factors, some one-offs included, which are listed in the box on the right-hand side at the bottom of the slide. The one-offs include the reorganization cost in Q3 2024 and also noncompete and severance pay, which adds to our costs. On the other hand, we have the inflation-linked benefit we recognized in Q3 2023 in the group, which increases the comparative base.



Net of these 2 factors, the growth rate in employee costs was 7.4%, and that's the number you want to look at. What else do we expect in employee costs in Q4? There's going to be more employee costs in Q4. In October, the Warsaw Stock Exchange Group increased the salary pool by 6% in response to inflation and in implementation of the arrangement with the trade union. So we expect that the costs -- the employee cost in Q4 will be higher compared to Q3.



External service charges, which is the other important contributor to operating expenses grew 4%, which is not much. But this nets 2 important changes, a significant decrease in the cost of consultancy down by more than 30%. On the other hand, an increase in external service charges related to the maintenance of our hardware, our infrastructure and IT software. So these 2 factors net each other off.



So we are not only seeing cost savings and optimizations. We are rather channeling the investments into more effective areas. As a result of these measures, let's go back to the previous slide for a moment. As a result of these measures, the cost-income ratio that we are paying a lot of attention to was reduced to 69.1%, which is 1.2 percentage points lower than in Q3 '23. And we will make best efforts to keep it down quarter after quarter.



Now let's look at EBITDA, which has been discussed before. So just as a summary, Q3 2024 EBITDA was EUR 42.5 million, up by 7.2% year-on-year. Our profitability improved to 37.9%. That's the EBITDA margin. We think this was a solid result in Q3, and we hope to keep it up.



Let's look at CapEx. This is, I think, very interesting for you to look at. As you can see, our CapEx in Q3 alone was not high year-on-year at PLN 13.7 million. The biggest decrease was reported in infrastructure, fixed assets. That's the dark navy blue part of the bar.



The same happened in Q3 '24, as you can see in the slide especially if you look at the cumulative numbers, 9 months into 2024, the CapEx in infrastructure fixed assets was only PLN 6.1 million compared to PLN 16.6 million in the same period of '23.



Why are we having a smaller CapEx? That's partly the result of the changes that took place this year, changes on the management Board changes on the IT teams. So we needed to review and verify the investment plans. Hence, the CapEx was put on hold. We had less expenses in these last 2 quarters.



But in Q4, we expect to catch up. So the CapEx in Q4 is likely to be much higher than the average for the 3 quarters of the year. And I think we are not getting close this year to last year's CapEx numbers, which were very high, both in absolute figures and as CapEx to revenue. But once again, Q4 will likely require bigger CapEx to catch up with the slowdown in the development of IT infrastructure later this year. But it is our aspiration to keep CapEx to revenue below the numbers we've been reporting over the past 2 years.



On this occasion, very briefly about the budget for our trading system, watts that we are currently developing, an important contributor to our CapEx, that's a result of many months of our IT offices reviewing the efforts so far and the plans to complete the Watts project. As a result of the review, we have shifted the scheduled rollout date of the Watts to November next. What does it mean?



Well, we've had to review the budget of the project because the project will take much longer than expected. Version 1 of Watts supporting all the Warsaw Stock Exchange and bots bond market, that budget is EUR 134 million. And the approved budget that also covers version 2 which will support the bonds O2O market and a preliminary analysis of version 3 to provide functionalities for the derivatives market. The total budget for version 1, 2 and the analysis of version 3 that we've approved is PLN 152.9 million.



And now very briefly about our liquidity position in the cash flows. No surprise here, very solid cash flows from operating activities, LTM last 12 months up to Q3 2024, nearly PLN 145 million. What's important to note is that represents nearly 29% of the EBITDA. So our EBITDA is almost 100% cash based.



Looking at free cash flows, 12 months ended September 2024, those stood at nearly PLN 80 million, up by 20% year-on-year. mainly due to the lower CapEx that we reported on the previous slide.



The cash position is PLN 350 million of free cash, net cash, which is solid liquidity to implement our investment projects without any risks to liquidity. No surprise, I guess, to anyone.

[Unknown Executive]

Thank you, Marcin. Let's talk briefly about our day-to-day focus and priorities. As we've mentioned on other occasions, we want to grow our core business. We believe there's a lot to be done to catch up with the growth of our product offering. This is what we are focusing on development of new products, especially for retail investors. We hope that the coming months and quarters will bring more news. We are also focusing on improving liquidity on the stock exchange, especially in the SME segment, and we are considering new products to improve liquidity there.



We have new ETFs traded on the exchange, more on that later. And this is also part of our overall strategy which we will probably be discussing in more detail in the coming weeks.



In the broader context that we consider very important in the context to grow the market at large, we are holding meetings or participating in meetings of a group of stakeholders coordinated by the Ministry of Finance to step up the growth of the Polish capital market with a number of different initiatives. We are also working hard, as you probably know, on the introduction of rates to the Polish market.



Another area in which we are very active is the regional cooperation with other regional exchanges. I'm also happy to say that we have the new issuer council at the Warsaw Stock Exchange. The first meeting will take place shortly.



In addition, as we've always been saying, we are still reviewing the noncore projects outside our core business, and we are focusing on optimizing our costs. This process continues. As Marcin said, next year, we will focus on improving the efficiency of our internal processes.



Later this year, after approval from our corporate bodies, we expect to present our new strategy for the development of our Warsaw Stock Exchange. And always surprise for everyone, I guess, a promotion on ETFs exchange-traded funds. We'd like to present this promotion. By the end of the year, no -- 0 exchange fees for exchange members on ETF trading. This promotion will be supported by an educational and marketing campaign to spark more interest in investing in ETFs. I hope this new promotion will fit in nicely with the growing popularity of passive investment products listed on the Warsaw Stock Exchange. We hope this will improve interest in ETFs and related instruments.



Long-term investments through the savings, pension savings accounts, which are now in high season. I hope the investors in that process will also consider ETFs on the Warsaw Stock Exchange. It's a promotion for our exchange members. I hope this will generate more interest on the part of investors and grow turnover in ETFs. And also, we hope this will help to grow, expand this offering with ETFs from exchange. We now have 13 ETFs listed on the stock exchange and ETC on gold. We have 5 funds on domestic shares, 5 on foreign shares, and we encourage all members to take advantage of our promotion. Thank you.

[Tomasz Bardzilowski, executive]

So this was a quick overview of the Q3 results. I'm very happy that we've been so effective. I'm looking at the questions we have received online. Let's move on to the Q&A. If there are many questions and we can't take them all, please contact us by e-mail. And after this meeting we will definitely come back to investors, shareholders, analysts and the media to take any questions. Are we ready for the Q&A? Let's begin.

[Robert Stankiewicz, executive]

Question 1 from [indiscernible]. Well, of course, this question is about expenses and revenue. A 69% CI, as you said, Marcin. [indiscernible] is asking when will you reach 50% as promised by the previous management boards.

[Marcin Rulnicki, executive]

Well, we have talked about our aspiration for our cost base. But please note that our expenses are now in a different place than a couple of years ago. We've seen a substantial increase in employee costs. We have increased our headcount, especially in IT with the development of our proprietary trading system and more. We want to be a competitive employer so we can't really promise that in this segment, or in this line of employee costs that there will be reductions. We actually expect to see ongoing growth in line with the growth in salaries in the economy. We want to remain competitive.



But we have seen opportunities for savings, especially in external service charges. And now we are going to work, as we said, to improve the effectiveness of our processes so we can take advantage of synergies across the group's companies.

[Robert Stankiewicz, executive]

We still have questions from [indiscernible] about expenses. IT costs have been growing by 25% year-on-year. Employee benefits by -- well, also a 2-digit number. With this growth dynamics, is it possible for the Warsaw Stock Exchange to improve its profitability?

[Marcin Rulnicki, executive]

Well, you've seen Q3 results, which I believe are a good reflection of our aspiration level. We want, of course, the revenue to grow even faster, but we have control over costs. Single-digit numbers -- low single-digit numbers is something we are aspiring to achieve in the quarters to come. And I hope this will help to improve our profit margins and profitability.

[Robert Stankiewicz, executive]

Now thank you. A difficult question about the President's intuitions. Let me read it out. Konrad Krasuski, Bloomberg News. The CEO said he's expecting new IPOs after ZabKa's IPO. However, the performance of ZabKa's stock may have been -- have had a chilling effect on other candidates. What's your intuition? Why have we seen this kind of performance? This is a question from Konrad.

[Marcin Rulnicki, executive]

Well, first of all, I'd like you to think about investing on the stock exchange as a long-term process. It doesn't happen overnight that you make gains. I'm sure that big companies listed on the Warsaw Stock Exchange, those that generate profits that, that valuation will grow. So in the long term, our investors will make gains, but this takes time. It takes time, but of course, the Warsaw Stock Exchange is hoping for new big IPOs. Let's hope that this year, we will see more of those.

[Robert Stankiewicz, executive]

Now moving on. We have questions about the future of the Warsaw Stock Exchange relating to new products. The individual investors association is asking, what about your plans to launch foreign ETFs on Global Connect?

[Marcin Rulnicki, executive]

Yes, this plan still stands. Global Connect is an important market from our perspective. You may say this is a kind of competition for domestic instruments because now we're talking about foreign stocks, but we believe that investors have access to foreign investments at the local brokerage firms or it's one click away really on your mobile phone.



We want the investors to have access to diversified foreign investments so they can diversify their portfolios here on the Warsaw Stock Exchange. So we are planning to continue expanding our offering, the number of stocks listed on Global Connect in the days to come. You'll hear more about the stocks on Global Connect. But our plan is to have more foreign ETFs listed in this market segment.

[Robert Stankiewicz, executive]

Thank you. We have more questions from [indiscernibe]. We have already addressed the issue of Global Connect in part concerning your plans and projects, but Shemek is asking about your investment in the Armenia Securities Exchange. What's the plan?

[Tomasz Bardzilowski, executive]

Well, we haven't changed our plan. We are a majority investor in the Armenia Securities Exchange, AMX. You've seen this year, we've seen a decrease in revenue and profits of the AMX due to lower depository fees. One of the main business lines of the AMX is a central securities depository. But we hope that when it comes to the financial results, those will stabilize.



We have a lot of ideas and strategic initiatives presented by the AMX management. We hope these will be implemented to improve the financials.

[Robert Stankiewicz, executive]

Thank you very much. We have a number of questions from the association of individual investors. SII. Mikolaj Lemanczyk is asking about the strategy that the President has already hinted at. Will the strategy be presented before the end of this year?

[Tomasz Bardzilowski, executive]

As I said, this is the plan. We are still awaiting the final approvals before we can share the directions of our development. But as we've said on a number of occasions, as the new Board of the Warsaw Stock Exchange, we want to focus on the core business on growing the capital markets because we can see a lot of opportunity, and we believe that the growth of the market will help to improve our results, our performance, including our financials of the Warsaw Stock Exchange.

[Robert Stankiewicz, executive]

Another question from Mikolaj Lemanczyk, the Association of Individual Investors. Your strategic directions of development following the update of the strategy. Are they expected to talk about acquisitions as well?

[Tomasz Bardzilowski, executive]

Well, we will want to be active, more active in the M&A market. We've mentioned that on other occasions as well. We see opportunities for that, but we want to focus mainly on the financial services industry. This is the segment we are already looking at closely, and I hope the first conclusions of this analysis will soon be delivered within the coming months.

[Robert Stankiewicz, executive]

We have a question about ETFs. A number of questions actually. [Indiscernible], Polish press agency business. Are you expecting new listings of ETFs on the stock exchange? Are you talking to any potential candidates?

[Tomasz Bardzilowski, executive]

Yes. We are working with the main provider of ETFs on the Warsaw Stock Exchange. There's been some press reports that this partner is working on ETFs relating to our dividend of total return indices. We will present an interesting instrument shortly as an opportunity to invest in a broad range of dividend-paying companies on the Warsaw Stock Exchange.

[Robert Stankiewicz, executive]

Another question about ETFs in the context of the news you've just mentioned, our program of promotions running until the end of the year, no fees on ETFs. This program for the reduction of fees in 2025, will it cover other instruments than ETFs next year?

[Tomasz Bardzilowski, executive]

Well, at this point, this program covers ETFs. Our strategy is to support the development of passive investment instruments to support long-term savings and investing on the exchange through ETFs. And the current version of the program is open until the end of the year, but we are also in discussions with market players and exchange members to possibly extend this promotion into 2025.



Next year, we want to focus when it comes to promotions and education on ETFs. We want to focus on ETFs that are based on SME indices. We believe that greater investor activity in this segment could impact in a good way, the liquidity in the SME segment, improve their valuations and open the way to raising capital for companies in this segment.

[Robert Stankiewicz, executive]

Thank you. There's a question from our foreign partners. Wood & Company are asking, they congratulate you on your results in Q3, but they are also asking when are we going to publish the date for the presentation of the new strategy?

[Tomasz Bardzilowski, executive]

Well, we'll try to make it happen before Christmas. So just give us a little bit of time and then we will present that strategy. We will, however, be focusing on initiatives that grow the market. We will be focusing on cooperation with stakeholders in the market. This is largely dependent on legislative amendments. We hope this kind of initiatives will, in the midterm, lead to improvements to the market.

[Robert Stankiewicz, executive]

I'm refreshing the Q&A page. We've gone through a long list of questions. Some of the questions replicate others that have already been answered. But there's a question from [indiscernible] about Q3, the annual awards, EUR 6 million, up 25% year-on-year. Could you comment on those? Why did those annual employee benefits or bonuses increase so much?

[Tomasz Bardzilowski, executive]

Well, concerning the annual bonuses, these are correlated with the exchanges profitability directly. The bigger our profits, the more benefits not only to the shareholders, but also to our employees to participate in this growth. This is also how we talk to our employees about cost optimization. We believe that they will be beneficiaries of the process as well.

[Robert Stankiewicz, executive]

We have questions from the Foundation for Polish Innovation, but these are questions to the regulator. So we will take these questions by e-mail, if you don't mind. I'm still refreshing the Q&A page. Some of them have already been answered as they seem to replicate others. Let me see once again.



Well, we've actually answered your questions. 40 minutes, this is one of the shortest and most effective meetings we've had. Everything seems to be crystal clear after Q3 and after 9 months. So thank you very much for this event. Once again, if you have more questions, if you have questions as investors, analysts, media representatives, please come and talk to us by e-mail. We will take your questions as soon as possible. Have a great day and see you once again next quarter. Thank you.