Low trading cuts DSE Q1 profit by half

DAR ES SALAAM Stock Exchange (DSE) net profit has declined by over half in the first quarter of this year compared to the fourth quarter last year. The self-listed bourse, net profit dwindled to 185.2bn/- in Q1 this year against 307.7bn/- of Q4 last year.

According to a statement issued yesterday DSE total operating revenue dropped to 1.178bn/- from 1.529bn/- recorded in Q4 last year, pulled down by registry and Central Securities Depository (CSD) and listing fees.

The registry and CSD revenues dropped by over half to 132.55m/- from 311.64m/- while listing fees plunged to 481.87m/- from 572.56m/-.

However, despite cutting down expenses in Q1, low revenue generated had its impact on the end results to reduce profitability.

Total expenses dropped to 993.12m/- from 1.2bn/- thanks to low operating and administration expenses. Staff cost was the only item in Q1 that register an uptick trend. Staff cost went up slightly to 615.88m/- from 603.74m/-.

Tanzania Securities said yesterday through a statement that profitability of the DSE was mainly contributed by a generally declining trading turnover.

“[The turnover] impacted negatively the fees payable to both the DSE itself and to its subsidiary the CSD & Registry Company Ltd.

The brokerage firm also said in a statement that the absence of new listings of companies at the stock exchange since last year was another factor.

“It should be noted that in the first quarter of the year, many investors usually focus on meeting their other obligations and hence this may have partly been the reason for the performance in the market.

“We anticipate more activity in the bourse as the year progresses, especially if the envisaged new company listings materialize,” the statement said.

The DSE stock was trading at 1,280/- yesterday down by 8.0 per cent from 1,400/- recorded at the beginning of the year.


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