Good afternoon and good morning, everyone. Welcome to the Warsaw Stock Exchange Q2 2025 Results Call today. Let me introduce today's speakers. We have with us our CEO, Tomasz Bardziłowski, the CFO, Marcin Rulnicki; and for the first time with us, the Chief Operating Officer of our commodity exchange, Mr. Mariusz Borodziński, and I'm Michał Zamiński, I'm the Head of Strategy and Investor Relations. We will have an approximately 25-minute presentation followed by Q&A. We encourage you to ask questions. If you'd like to ask a question, you can either press the "Ask a Question" button if you've joined us online, or if you join us through the phone, you can press star two on your telephone, keep that, and you will join the queue. You can, of course, also ask a typed question if you type your question in the box provided on the screen.
Now, without further ado, I would like to pass the voice to our CEO, Tomasz Bardziłowski.
Thank you very much, Michał, and welcome again to our earnings call. We are starting our presentation with the key achievements for the Q2 of this year, and it was a record year in many aspects for Warsaw Stock Exchange in terms of record high equity turnover, in terms of the performance of the market, and also in terms of our results. Equity turnover surged by almost 50% year-on-year in the Q2, and also, we are proud to say that we have many records in terms of performance. Our broader market index WIG, for the first time in its history, surpassed a symbolic mark of 100,000 points, and that recorded several all-time highs until yesterday.
And this helped our main engine of our revenues, which are cash equity business and the financial market revenues, to go up by 24%, combined with a very strong performance from the commodity market, with revenues up by over 12%. This led to a 19% increase in the consolidated revenue line to a record high of PLN 144 million . In terms of costs, we recorded an 8% growth in operating costs, slightly higher than in the Q1. However, on the back of the positive effect of operating leverage, our cost-income ratio fell by more than 6 percentage points to less than 63%. Helped with such a strong revenue growth and lower cost-income ratio, our EBITDA and net profit lines increased by around 40% on an adjusted basis.
Again, our net profit line was a record high, excluding the history of the Warsaw Stock Exchange, excluding some minimal events. We paid our dividend of PLN 3.15 per share a few weeks ago. It was a 5% growth year-on-year, almost 90% of consolidated net profit. We are very happy to see a strong performance also of our share price, which reached an all-time high two days ago, even after deducting the dividend.
Just to illustrate what I said about the surging equity turnover, you see on this slide that the previous quarter was also a record high, and this is slightly above the previous highs which we recorded in 2020 during the so-called COVID rally. According to the statistics of the Federation of European Exchanges, this increase has been one of the best in Europe. We are especially happy to see a high liquidity of the market compared to other exchanges measured by the volatility ratio.
We are number two in Europe after Deutsche Börse, with a ratio at above 50% in the Q2. Speaking about the performance of our indices, in local currency terms, there is almost a 40% increase since the beginning of the year. And looking at MSCI Poland, measured in US dollars, the performance is now slightly above the 50% mark, which makes Warsaw, in our market, one of the best-performing global markets in the world. And we believe the market is still relatively attractively valued compared to MSCI Emerging Markets on our MSCI World. You see here still quite significant discounts.
In the Q2, we noticed a significant improvement in terms of the equity market transactions. Here, the value of total ABB secondary offerings and IPOs went up by four times compared to the second period of last year. We are especially happy to see a couple of IPOs, including the IPO of company Arlen, announced in the Q2, a clothing manufacturer for the Polish army, with an offer value of PLN 271 million . Combined with the IPO that we had in January of this year of Diagnostyka, we are especially happy to see a strong aftermarket performance, price performance for those companies.
Looking at the bond market, the non-treasury bond market, here we recorded a decline in the issuance, mainly due to high base effect in the Q2 of last year. There were a couple of large issues to the central banking sector. However, we expect a recovery in the Q3 here, with two large offerings of consumer bonds for consumer companies, including a PLN 1 billion issue of Żabka and PLN 1 billion issue of Allegro.
Let me now pass to our CFO, Marcin, to guide you through our numbers for today.
Hello and welcome, everyone. In the following few slides, we would like to present more details on our financial performance in Q2 and the H1 of 2025, starting with the big picture P&L and consolidated numbers. So, as you can see, our revenues in Q2 were PLN 144 million and an upward growth of almost 20%. And this growth came both from financial markets, where the revenue growth was even more dynamic, mainly due to very good trading and equity trading-related revenue, but also a very solid growth on the commodity market, with 12.5% up year-on-year. And this was mainly due to high turnover on gas, especially in all transactions. We will present details of the revenues in the following slides.
In terms of operating expenses, they reached PLN 90 million in the Q2 after a growth of 8.1%, a bit faster than Q1, where we had a 5.3% growth rate on operating costs. But we also mentioned that in our Q1 earnings call that in the following quarters of 2025, we expect the growth rate for operating expenses to go up. In other expenses, you see that in comparable data, we had much higher numbers. We had a non-recurring write-off of one of our intangible assets, one of our software solutions developed internally.
Hence, we are presenting adjusted EBITDA and adjusted net profit numbers, even though in Q2 or in the H1 of 2025, we didn't have any non-recurring one-off transactions. We had them only in comparable data. Anyway, adjusted EBITDA, if you compare to Q2 of 2024, went up by 43%, a pretty impressive growth. And also, our profitability margin on EBITDA is over 43%. So, it's been the highest for the last three years, and we are very happy about it.
What happened below the operating profit line? We still have pretty good growth in our associated companies, mainly in the depository, where the profits grew by almost 22% compared to Q2 2024. And also, better results on financial activities. And here, we have both slightly better return on our deposits, but also we have lower financial costs related with interest on potential EAD liabilities that have been recognized in our liabilities. Okay, as a result, the adjusted net profit was almost PLN 58 million , and it also grew by almost 43% compared to the previous year. So, generally speaking, a very strong quarter, and we are very happy with the results.
Looking at the revenue mix, not surprisingly, following the high growth rate in the financial market, also the share of this segment in the overall revenue mix went up, and in Q2, it was over 66% of total consolidated revenue of our group. The commodity market growing slightly slower, and consequently, the growth in the overall revenue mix was a bit lower than the year before and went down to 31%, with other revenue remaining on a stable level.
Now, let's have a look at the biggest segment, the financial market and the revenue here. We are analyzing the trading-related revenue, so, again, the biggest part of our income from the financial market, and looking at different classes of assets, you can see that the most dynamic growth we observed in the equities. On the left-hand side of the slide, you can see the dark blue bar representing revenue from equities. In Q2, they reached a level of PLN 52.5 million after a 45% growth year-on-year. This is a consequence of record high turnover on equities we had in the Polish market in Q2. It was PLN 131 billion, and it was almost 49% higher than the year before.
We can see, and I'm now looking at the right-hand side of the slide on the table with the operating data. We can see the average fee per transaction went down a little bit, almost 5% year-on-year. It's not because of any changes in our price list. It's because of lower, oh, sorry, it's because of the higher value of the average transaction, which translated to a lower average fee. This is how our price lists are composed.
At the same time, the number of transactions went up. It was 13.4 million transactions in Q2 only, and it's 34% more than the year before. On other assets, we had smaller variances, with the rebate going down a little bit and revenues from debt trading going up and other revenues not changing very much.
Speaking about other revenue streams within the financial market segment, we can see maybe not super dynamic, but solid growth in the information services line. And we are very happy about it because this growth we have observed for a few quarters now. We can see the new customers and new subscribers is growing, and this revenue is consistently going up over the summer. So, again, we are happy about it. In listing revenue, listing-related revenue, no big changes.
As we are for our Armenian stock exchange, we can see there was a slightly lower revenue in Q2 of 2025, but in the H1 of the year, we had 6% up in revenues from this market. Now, a few words about the commodity market. I will let Mariusz to comment in detail on this one.
Hello, everyone. I'll stand for the commodity market. Revenues from trade income in the commodity market, which is almost PLN 26 million in Q2. It represents an increase of more than 20% year-on-year. Revenues increased in all segments, apart from revenues from property rights trading. In Q2, on the electricity market, we recorded revenues nearly PLN 6.5 million , representing nearly 6% growth. There is need to remember that the energy market runs without trading obligations, what has an impact on the market liquidity.
In Q2, natural gas trading reached nearly 52 terawatt-hours, generating revenues of PLN 7.3 million . It means that we had an increase of over 90% year-on-year. And the high growth in gas trading reflects a growing growth of gas in Polish generation units. We are happy because of the activity of gas market participants last quarter, but we also observed a very strong engagement in the current one.
On the property rights market, we recorded an increase of almost 20% in Q2. In the Q2, we observed a shift in seasonal peak redemption from Q2 to Q1. In other segments, the increase in revenues is mainly due to the revision of our Clearing House discount policy.
Let's move on to the Clearing revenues. In Q2, in this segment, we recorded an increase of over 21%. This growth was driven by higher trading volumes and transactions on the gas market, which are set up, of course, by our Clearing House. And in registers, we observed a decline in income from register maintenance, and it is the result of lower volume of operation. And additionally, it is worth to mention that the decrease in revenues was caused by significant reduction in the mandatory redemption level. I think it's the most important initiative from the commodity market.
Now, coming back to consolidated numbers, let's look at the operating expenses for a while. In Q2 2025, they reached a level of PLN 90.6 million, 8.1% up year-on-year. Again, a bit faster than in Q1. We also expected this growth and informed about our expectations already commenting on Q1 results. Where are the reasons for this growth? Mainly in staff-related costs. Yes. So, in personal expenses, we had three reasons for the going up so much by 13.5%. The first one is the number of our employees. The number of full-time employees at the end of June 2025 was almost 6% higher than the year before, the year earlier.
This growth is mainly in IT-related teams. So, we have more employees in teams which are involved in the development and implementation of our transactional system. But, of course, most of these costs are capitalized and treated as investments. And at the same time, we also strengthened the teams which are responsible for maintenance of our infrastructure and software that we use for operational activities. So, these are the areas where we see the new employees most.
We also had an increase in remuneration in the whole group, which happened in October 2024. And the average level of this remuneration growth was 6%. And, of course, in comparable data, we don't have it yet. And last but not least, our variables averages are very much dependent on the performance of the company. Therefore, our good results in the H1 of the year and expectations in the H2 of the year translate into higher provisions for variable average. So, that's the third component of the staff cost growth that you see in Q2.
Speaking about external services, we see there is a small decline compared to the previous year, and trends within this group of costs are more or less the same as in previous quarters, so we spent more on IT-related services, and here, you can see in Q2, the growth is almost 10% here. At the same time, we try to be very careful spending on a binder and other external services where in both categories you see decline. It's also worth commenting on the higher depreciation and amortization costs in Q2. There are mainly two reasons for this. One is that within Warsaw Stock Exchange, we developed two software platforms that were contributed to our dedicated subsidiaries, Logistics and DAI, and they were operationally launched, and we started the depreciation of this, and so, this is the first reason for higher depreciation amortization costs.
The other one is that we had a number of investments in operational systems of our commodity exchange. These extensions were finalized mainly at the end of 2024, and they also resulted in higher amortization in the current year.
This is about details, but looking at the big picture, I think we are happy to say that this is the fifth quarter in a row when we see the revenue growth rate is higher than the operating expenses growth rate, which you can see on the graph on the right-hand side of the slide. It means that in five quarters in a row, we have been able to improve our profitability, which you can see on the bottom graph. Our cost-income ratio is in Q2 at a level of less than 63%. Again, the lowest in the last three years.
Capital expenditures, I would say no surprises here, even though the dynamic, the growth rate of investments year-on-year looks pretty dynamic at 42%, but I would say that the comparable data is very low, especially when you look at equipment investments. What we can see in Q2 2025, PLN 3.3 million quarterly is, I would say, the average level that I would expect, whereas in comparable data, it's just PLN 300,000. So, that was exceptional. In intangible assets in this part of our investments, we can mainly see the salaries and costs related to the development of our Warsaw Transactional System, which are capitalized. So, this is the majority of the light blue bar, and it grew 16% year-on-year, and it's according to the plan because we are intensifying the spending in the last month before the goal like that.
Speaking about liquidity and our cash position, no surprises here. We had a very strong operating cash flow in the last 12 months ending June 2025. Even after deducting higher capital expenditures, still, we ended with free cash flow, which was more than 30% higher than in 2024. And our results are still, let's say, translating into cash very much. So, if you compare operating cash flow to our EBITDA ratio for the last 12 months, and in June, it's almost 95%.
So, I would say it's pretty high. Our net cash position at the end of June was almost PLN 470 million . Please note that it was before we paid out the dividend in the first days of August, the dividend in the value of PLN 132 million . So, anyway, very, very safe liquid position and very liquidity position and very, very strong operating cash flow, no changes here.
Let me now give you some update on the progress of some of our strategic initiatives as per the strategies that we have announced in November last year, the EU strategy. So, a few of them are an increased support for local brokers for research and for analysis of smaller companies with the global exchange. We have increased the budget for this program by 50%. This program now is comprising of research coverage of 65 companies by 11 local brokers. And also, we have included a quarter of new attempts on our alternative market, NewConnect, and our bond market, Catalyst.
Speaking about NewConnect, we have changed the segments of the 300 companies that are listed there. And I would say, the largest and most liquid companies are included in the focus segment. It will be covered by the research sponsoring program. Also, there will be new activities, including conferences for the new companies that we want to host this year.
Initiatives aimed at attracting new IPOs is our IPO Academy. For the first time, it will start in October this year, a five-month program. We are very happy to see that almost full, we have almost full list of participants who took all available seats in the program. So, hopefully, there will be some IPOs from this group as well. And as we speak on many occasions, a very important segment of the market is for us, ETFs. We are now in a zero-trading fee program for ETFs ongoing. And we are happy to see an increase in turnover in ETFs. This turnover increased more than doubled in the H1 of this year. And recently, a few days ago, we had a first listing of a very interesting ETF, a Dividend Plus ETF, which is based on the WIGdivplus Index, an index of 52 companies paying regular dividends.
And this ETF will pay a quarterly dividend. We have already observed a surge in turnover in this ETF. So, very happy with this development. And there will be new ETFs debuting quite soon, including an ETF on global defense companies and also a Bitcoin ETF. I just wanted also to share with you the update on where we are with our launch and the works on our new trading platform, WATS, which is a proprietary trading platform. Now we are using, as you may know, UTP, which is a platform delivered by Euronext. And here, the works are undergoing according to the schedule. We are undergoing various tests together with exchange members. At the end of August, we will have the first out of four registry households. We will confirm a go-live readiness for the 10th of November, the last date, by the end of September.
Guidance for the next two quarters, how we see the market, financial market. We had a very strong growth in the trading, cash equity trading, also in July, almost 70% year-on-year. In the H1 of August, slightly lower. In September, we expect most likely a slower growth, assuming that the volumes will stay comparable to those in August this year. Due to a base effect, the volumes in September last year were very significant, and there will be a somewhat lower growth.
Income of the market, a similar trend as we saw in the Q2 with the gas market turnover, very strong, almost over 8% growth in July, and almost 100% growth in the H1 of August. On the other hand, a significant decline in turnover in the energy market, trading in July and in property rights. In terms of operating costs, as we said, the operating costs increased in the Q2 to 8% on a year-on-year basis. You would anticipate even a slightly higher growth rate in the H2 of this year due to intensification of works on the new trading system and also on the new financial accounting system, as well as higher expenses for the promotion of our market and the stock exchange. CapEx should be at a similar or slightly higher level than in the H1 of this year.
What's quite important in terms of developments on the market as a whole is a recent announcement from the Ministry of Finance of a new personal investment account with some tax incentives. This new account called OKI, a personal investment account, will offer no tax on investments up to PLN 100,000. Above this level, a tax on assets, which will be around 0.8%, calculated at current rate of capital gains tax multiplied by the yield on risk-free assets. This solution, as it was said by the Ministry of Finance, was inspired by a well-known account in Sweden called ISK. Here on the charts, on the slide, you can see the development and the growth since the setup and establishment of this account in Sweden in 2012.
It's one of the most popular accounts in Europe because as much as 40% of the Swedish adult population owns such accounts, with total assets on the account almost EUR 180 billion. We hope that definitely this is something which could attract new investors to the Polish capital market. According to estimates by the Ministry of Finance, within three first years, the value of assets on OKI accounts may reach PLN 100 billion, so around $25 billion. We believe that a part, a significant part of this amount will also reach the Warsaw Stock Exchange. If so, it will be a real breakthrough in the development of the Polish capital market, which, as you see also on this chart, in terms of market capitalization to GDP, Poland is certainly a less developed market with only 2.2% ratio.
When you look at EU average cash flow across Germany, this ratio is closer to 50%. The average in the EU is 64%. And in Sweden, as we talked, this is a most developed European capital market with a ratio of stock exchange capitalization to GDP of 117%. So, really a long way to go for us. And we hope that the new account will be introduced in line with the plan, which is for mid to next year.
Thank you. And that concludes the presentation. We are ready to begin our questions and answers session.
Thank you. Thank you very much for the presentation. So, we are now opening the floor for the question and answers. If you are connected via the phone and you would like to ask a voice question, please press star two on your phone keypad and wait for your name to be prompted. Web participants have also the option to ask a voice question or send a question with the box provided as a text. We'll just give a minute or so for the questions to come in. Once again, phone participants, please press star two. Web participants, you have two buttons: Ask via audio, which means you would like to ask a voice question, or you have the option to send your question as a text.
We have no questions online. So, I take it that the results are unquestionably good, and our investors are pleased with what they've seen. If you'd like to ask a question, this is your last call.
Okay. As I'm seeing no questions, so perhaps I'm going to pass the line back to the company for their concluding remarks.
Great. If you do have questions, or some questions that appear later, please do reach out to our investor relations team. If not, well, thank you for participating in this presentation, and we'll be happy to look forward to speaking to you again to now accurate results in November. Thank you.
Thank you.
Thank you and goodbye.