JSE Limited (JSE) Earnings Call Transcript & Summary

Good morning, everyone, and thank you for attending. My colleague and CFO, Aarti Takoordeen and myself have the incredible pleasure to welcome you to this year of full financial 2021 earnings call. Our agenda for today is as follows: I'll start with key highlights for the year before delving into specifics on our group performance. Next, Aarti will comment on the financials in a bit more detail, and then I'll come back to wrap up the presentation and provide some outlook comments as well as an update on our strategic initiatives. I'm going to start with Slide 4, which gives you a sense of our 2021 results at a glance and our key messages for the year. Our full year revenue growth was driven by counterbalancing half year performance, a tale of 2 cities. Firstly, the high base effect in the first half of the 2021 year as heightened market activity and volatility in the first 6 months of 2021 were driven primarily by the COVID and other macro events, such as the downgrade and South Africa's exit from the World Government Bond Index. Next, we had higher value traded in the second half of 2021, and this was linked to a greater number of corporate actions, including, of course, the Naspers and Prosus share swap which resulted in record high trading activity on the JSE in August 2021. 2021 also marked the first full year consolidation of JIS. We are seeing some commercial momentum in our organic growth strategy as JIS has started to contribute meaningfully to our earnings. We have successfully integrated this business together with the share plan service business into the group. And our EBITDA was stable year-on-year, slightly above ZAR 1 billion, and this is a testament to sound operating performance in a challenging environment, especially when you consider that last year's EBITDA was up 19%. The net finance income declined year-on-year due to historically low interest rates in South Africa, resulting off a flat operating performance and a reduction in net profit year-on-year. Lastly and importantly, the JSE remains soundly capitalized. And we maintain a leverage free balance sheet and a highly healthy cash balance. The strong cash balance was able to support growth in dividends whilst retaining cash in support of our growth agenda. Shifting now to Slide 5 on the financial highlights. Here is how this all translated into numbers. Operating revenue was up 3% and costs were well contained at 4% growth. This resulted in a flat EBITDA and a healthy margin of 41%. Earnings were dampened by net finance income as we exited the year down on earnings per share by 7%. Strong cash generation continues be a key feature and strength of the business, and this allowed for us to declare an increase in the ordinary dividend and a payout ratio of 92% as well as a special dividend. Shifting now to Slide 6, around the pickup in the second half of the year. You see the tale of 2 cities that I was talking about visually here. And this illustrates improvement in value traded over the second half in 2021, with a 20% year-on-year increase that followed a 5% decline in the first half of the year. The decline in average daily value traded in the first half included sharp drops in March and April, particularly, which was linked to the strong COVID base effect in 2020. Meanwhile, in the second half of 2021, the 20% year-on-year increase in average daily value traded was driven by multiple corporate actions with a sharp increase, of course, in August following the Naspers-Prosus share swap. This led to value traded hitting record highs of ZAR 160 billion on 1 day in August of 2021. And overall, that led to a 7% overall increase in ADVs for the full year, which naturally contributed to the operating revenue that I've just mentioned. And meanwhile, the All Share Index count steadily during the year to gain 24% overall in 2021. That compares really favorably to the MSCI Emerging Market Index, which was only up by 14%. Shifting now to Slide 7, which indicates a higher equity value traded despite lower volumes during the year. This slide shows a slightly different picture. And we can see on the left-hand side, monthly billable average daily value traded increased 5% year-on-year. This is billable consistent with what we've seen on the previous slide, but also 7% -- off a base of 7% increase on 2019. That's due to a higher -- to higher equity market capitalizations overall on the JSE as well as in other stock markets across the world, which we're going to see shortly. In terms of the number of deals, the monthly average daily transactions declined by 11% year-on-year against a high base in 2020, again, whilst still remaining 18% higher versus 2019. Shifting now to Slide 8. We see the JSE All Share Index outperforms the real economy. The equity market capitalizations have increased dramatically in South Africa, similar to most stock markets worldwide. In fact, in the last 24 months, the JSE All Share Index climbed by 29% despite the impact of the pandemic. This has been part of a long bull run market for more than 10 years, which was interrupted only on a few occasions. And if we take a long-term view, the last 21 years shows a 667% increase in the All Share Index, which is 136 percentage points higher than the increase in nominal GDP in South Africa, which was at 531%. This is a testament to a certain extent of the de-correlation between the stock markets and the real economy, which ultimately led to higher value traded for the JSE. Shifting now to Slide 9, around the continued execution of our strategic road map, I'm not going to go through the detail. But really, it just gives you a sense of the execution of our operational and strategic priorities. As you can see, a sizable number of initiatives have been implemented. I'm just going to highlight the second half of the year because I already spoke to the first half of 2021. As we've already updated you on the first half of the interims, our start in August, which is when we submitted our transition bond framework to the FSCA for public consultation, we are delighted to say that we, yesterday, achieved regulatory approval. We'll be launching this officially imminently, and transition and sustainability linked bonds will also support the funding of sustainable outcomes as companies outline a path to net zero. In addition to this, the JSE, in partnership with FTSE Russell offers ESG data and ratings for listed companies. And still on sustainability front, we launched in December sustainability and climate change disclosure guidance, which guides listed companies on best practice ESG disclosure with an aim to promote transparency and good governance. I'll focus on that a little bit more in the last part of this presentation. And then finally, in December, an important milestone was reached as JPP, or JSE Private Placements, obtained a financial services provider license. This license will facilitate our growth in private markets in both equity and debt through an automated and digitized platform. The platform will connect private companies and issuers directly to investors, enabling private capital formation in a more transparent, efficient and accessible manner. Turning now to Slide 10. JSE is now fully integrated and growing. We completed our acquisition, as you know, of 74.85% in November, and we acquired the remaining minority stake of 25.15% in June of this year. We also acquired the share plan service in later this -- later last year. And we've seen strong performance, particularly in the second half with 8 new clients. We look forward to growing this business. I'm shifting now to Slide 11. And really, just to talk to you about group business performance. I'm going to go to market drivers. As you'll see, we have introduced 8 new IPOs on top of a base of 4. While it's more than double the number, there's a lot of work to do to increase our number of IPOs. The equity market capitalization is -- has increased by 15% off a base of ZAR 17.9 trillion. Our number of delistings have decreased to 25, and bond nominal value traded, we're very pleased, has increased by 6%, together with equity derivatives value traded up by 7%. Currency derivatives, which is a small part of the business, contracted by 13% and commodity derivatives marginally up. If I shift now to value traded and the JIS driving revenue growth, you will see that the capital markets increased by 1% overall year-on-year. Our equity market revenue was down by 1%. Largely corporate actions in the second half of the year, as I said earlier, have increased our higher value traded and offset the strong half year 1 2020 base effect. We made a positive contribution from co-location equity derivatives, and we are particularly pleased that more than 50% of our trading is now processed through that environment. On the post-trade side, largely the contraction was driven by a high base effect on scrip lending and penalties. Our BDA business declined in line with the contraction of number of transactions of a double-digit base effect growth and funds under management marginally reduced. Our information services while it decreased by 2%, we are particularly pleased that we saw a 4% underlying growth in that business when we removed the negative FX impact from the stronger rand dollar. Of course, our JSE Investor Services is now in a full year consolidation period. We saw a much stronger half year 2 revenue performance of ZAR 74 million versus the ZAR 52 million in the first half. And this was driven by revenue related to new clients, corporate actions and, of course, our new share plan business, which was only acquired towards the end of the year. What we're particularly pleased about in the JIS business is that this demonstrates our ability to execute on our vision to diversify our revenue. And we've effectively shifted revenue that would have been marginally down by 2% to plus 3% in operating revenue as a result of the diversification effect of the JSE Investor Services. I'm now going to hand over to our CFO, Aarti Takoordeen, who is going to take us through the financial results. Aarti, over to you.

Thank you, Leila, and good morning all. It is such a pleasure to present a strong set of results like this. I'm going to take you through the high-level story lines in the numbers and unpack some aspects as we go along the way. Now on the financial highlights Leila has already shared with you, I just want to pull out a couple of things. Again, record high operating revenue growing at 3%, but the record high at just over ZAR 2.5 billion. A key rather pleasing feature of these sets of results is the OpEx growth. So exceptionally well controlled OpEx growth of actually 3.5% rounded up to 4% year-on-year growth, and a very pleasing below South African inflation and also consistent with our guidance of a carefully controlled cost base. In fact, the like-for-like operating expenses shrunk by 2% year-on-year, and I'll unpack how in a little bit. EBITDA, a key feature in terms of metrics for us, came in flat, as we mentioned earlier, at a very healthy 41% margin rate. So overall, a reasonable performance given the very tough environment. So in terms of the net finance income, no surprises there. It was well guided and expected in a record low yield environment of global phenomenon. And that dragged our earnings after tax numbers down, resulting in what we see in earnings per share and headline earnings per share drop of 7% and 6%, respectively. If we turn to cash and capital, a long-term cornerstone of the JSE investment case is our ability to generate cash. And you can see again -- once again, we report over 100% in cash conversion. We spent about ZAR 165 million in CapEx for the business, and I'll unpack where that went in a bit. And about the same amount, just under ZAR 160 million in support of our inorganic investments to grow our business in organic terms. In terms of regulatory capital, the much awaited number that we've all been looking forward to, dear analysts, we report a solvency requirement of ZAR 1.1 billion against our balance sheet. And, of course, contained and within that number, ZAR 789 million in cash and cash equivalents. I will disclose in some more detail on that in a bit. Landing on, again, a very strong cash balance and that enables a very strong growth in the, again, ordinary dividend payout, ratio being 92% and ZAR 784 cents per share as well as the special dividend of ZAR 100 cents per share. A strong payout ratio, as I mentioned, as well as growth in the ordinary share exactly as we've guided. Now if I just glance on the income statement, a few call outs only on this slide, you will see other income lower than last year, and that's because the prior year was high. It included non-distributable regulatory fines imposed on the equity-listed companies. Further down on the slide, outside shareholders refers to the shareholders of JIS prior to the buyout -- the minority buyout by the JSE. And as we flagged earlier and have been flagging, a drag in after-tax earnings is largely driven by the net finance income suffering from that record low yield environment. Still, we managed to close on a very healthy after-tax margin of 28%. And this is in the line item. In terms of line items, I think that the most influenced by management would be the operating expense line. And so if we take a closer look at that operating expense number of ZAR 1.78 billion growing at just under 4% year-on-year. Included in that cost for this year of the full consolidation is ZAR 106 million related to JIS operating expenses. Now that plays ZAR 15 million from the prior year. So notwithstanding that base effect, we grew the cost by below inflation, rounded up to that 4%. And within that, personnel costs is probably the largest cost line in JIS, a labor-intensive environment and mostly the reason for that 8% increase in personnel expenses. The JIS increase is -- offsets the rest of the group personnel expenses through -- partially through lower retention payments, leave payments and other payments. We also paid lower bonuses than the prior year. Now technology cost is something I'd like to just point out to you, increased by ZAR 15 million or 5%. But again, JIS full year consolidation represents ZAR 11 million of that ZAR 15 million. So tech costs are well under control. And once you carve the JIS component out of the technology costs, tech costs grew by 1% or just under 1% year-on-year. On depreciation and amortization, that is up 3% and mostly as a result of the amortization of intangible customer contracts on the acquisition of JIS. And lastly, on general expenses, we are down year-on-year, 2%. And the prior year was higher because we incurred M&A-related costs linked to both JIS and global cap. So taking a step back, excluding the full year impact of JIS consolidation, OpEx or operating expenses, were actually down 2%. And you can see that we've mapped that out for you. The underlying decrease there is driven by the discretionary or general expenses in the form of acquisition-related costs, as I have mentioned, as well as the absence of COVID-related donations in the prior -- well, in this year. So I think that, that placing on record is a demonstration of disciplined cost management visible right here. If we move to capital expenditure, we spent ZAR 165 million, mostly on investing in the resilience of our business, maintenance-type projects. The 2021 spend includes leasehold improvements and rejuvenation of our infrastructure and systems. That's about ZAR 62 million each. The remainder was spent on clearing system upgrades, smart regulation and automation, and our client -- our new client reporting platform, JSE Market Data Connect. Meanwhile, if we were to look at what CapEx grew the business, it was largely directed towards securities, collateral, the new diesel contract platform and some co-location activity. And if we look at our guidance that we are mapping out for 2022 in capital expenditure, we are sharing a range of ZAR 140 million to ZAR 180 million, which includes a sharp increase in growth investments of about ZAR 38 million, and that's going to be primarily directed to the Information Services organic growth strategy, which Leila will comment on a little bit further later on. If I move to the quality of earnings, this is evident in our continued ability to convert to cash in strong terms. I'll quickly now go to the cash bridge that we share with you. We end on that healthy ZAR 2.4 billion, as good as flat from the prior year despite paying or after paying ZAR 165 million in CapEx, which I've already mentioned. And of course, closing the acquisition of the minority stake of Globacap that is included in investing activities. And actually, the ZAR 75 million buyout of the minority shares in JIS is disclosed under financing activities, because it will say so. So how much of that ZAR 2.4 billion is held for regulatory capital purposes? It is the first time we comment explicitly on the JSE's regulatory capital. And as you know, the JSE holds capital for JSE Limited, the Exchange and the JSE Clear Company according to the Financial Markets Act. The group calculates this in the form of equity, which amounted to ZAR 1.13 billion for JSE Limited and JSE Clear combined at the end of December. Meanwhile, this equity is supported by restricted cash and cash equivalents of ZAR 789 million. So that's some more color on our regulatory capital numbers and our referenced cash numbers. And on that basis, we can confirm that the group remains adequately capitalized and able to operate safe marketplaces for all its participants. More importantly, on capital allocation, all of these results allows us to declare record high ordinary dividend per share of the ZAR 754 cents per share, implying that 4% increase year-on-year and implying the 92% ordinary dividend payout compared to 83% of the prior year. On top of that, the special dividend of ZAR 100 cents per share, a demonstration of our commitment to maintaining attractive shareholder returns. You can see the track record is strong in terms of our guidance and our commitment to maintaining a progressive ordinary dividend over time. And so on that positive note, I will hand over to Leila. I look forward to the one-on-ones, and we'll take questions later. But for now, Leila will conclude and provide some outlook statements.

Thank you, Aarti. Thank you so much. So I'll give a couple of comments on our outlook and corporate strategy. And to start with, I'm going to go to Slide 25, where we wanted to highlight our approach to sustainability, which is a key pillar of our strategy. The JSE has very much of a two-pronged approach on that front. Firstly, internally, within our organization and business operations. And this will be through employee welfare, board diversification, remuneration policies and taking responsibility and accountability for environmental footprint. And secondly, externally, by being driven -- by being an exchange, which offers access to capital and responsible investments. This is through providing advocacy, ESG investment tools and maintaining an appropriate regulatory framework and contributing to the national agenda as you know we've always done. In particular, the JSE launched in 2021, a public consultation to provide guidance on the sustainability and climate change disclosure for listed companies and to help issuers align with international best practice. We issued public consultation in December of 2021, which is expected to conclude at the end of -- well, has pretty much concluded at the end of February. And this considered hundreds of ESG metrics and highlighted those that are material to value creation within the South African context. The finalized guidance will be published this year, and we are very much looking forward to providing a local perspective, which is based on global best practice around sustainability. If I shift now to Slide 26, which really focuses on our inorganic growth strategy to position the JSE in high-growth areas. We've already communicated on the JSE's long-term aim to diversify revenues and enhance quality of our earnings, and this has been demonstrated through these results. This remains a key focus area for us. And whilst the JSE has a proven and successful M&A track record, and you can see at the bottom of the slide, we've provided some more color on the components of that approach. Starting with the key strategic guidelines on the left, we will prioritize, firstly, a strong fit with capital markets growth areas, a higher share of revenue from non-trading annuity businesses, a stronger international footprint with new client groups, as well as a clear value creation pathway for shareholders, including post-merger integration and synergy realization plans. Lastly, we will prioritize majority stakes and JV partnerships to allow for better control. Next, we've also outlined in the middle of the slide, key financial criteria. This includes strictly pursuing opportunities which will diversify revenues and profits, favoring cash earnings and margin-accretive opportunities over the medium term, but growth rate accretive activities. Lastly, we have a really strong team in place, which -- whose mission is to maintain a disciplined approach to avoid paying unreasonable premiums, which is a common error especially in these times. So keeping the guidelines in mind, our future focus will be shown by the chart on the right-hand side, where we demonstrate data and information services and software and technology. And these 2 areas will complement the JSE's current strategic footprint as a provider of traditional market infrastructure. If we move now to Slide 27, we share with you a reformulated and revised information services growth strategy on a 5-year horizon. So to provide a little bit more color on what I've just mentioned, we have indeed reformulated our growth strategy on a 5-year horizon for information services, a key focus area for the group. As you know, information services is a growing contributor to the group revenue with a 7.6% CAGR over the last 5 years, well above the group average. Such growth was underpinned by significant investments into data operations, a strong network of relationships with clients, data distributors and partners, our team's expertise in evolving market data -- market data use cases and, of course, successful prototyping of cutting-edge technology. Now we aim to accelerate growth, and we've identified focus areas to do so. This includes maintaining high operational effectiveness, modernizing our data architecture and expanding service offering and, of course, supporting initiatives around digitization and new market opportunities. And focusing on these priorities, we aim to achieve the following in the medium term: Firstly, to ensure transition of existing data products and services into cloud-based solutions as this will better suit our clients' needs; secondly, to expand the geographical footprint of JSE market data with partnerships; and lastly, regularly expand the analytics, services and new data assets. With a lot of exciting initiatives underway internally, we look forward to developments in key segments of our business, and we'll certainly keep you updated on progress in that regard. I'm shifting now to Slide 28, which is the 2022 strategic objectives and to our near-term objectives for 2022. We continue to prioritize generating sustainable, high-quality earnings. This includes delivering headline earnings per share growth year-on-year and ROE within our target range. Protecting and growing our core business will remain a key focus. As such, we invest in our core assets. And in cybersecurity, this is obviously paramount for operational stability and resilience of our market infrastructure. Next, we'll continue transforming the business through several growth initiatives, which include progressing our digital transformation journey, and we've done a lot in that space recently, but also advancing on our inorganic growth strategy as described, as well as on our SME strategy, progressing our private placements platform. And moving forward on our plans, it's going to be vital that we operate as a partner for a sustainable marketplace and to contribute to the global sustainability agenda. We'll maintain our BEE rating, and we'll focus on a two-pronged approach that I've just described with the internal and the external priorities, with a view to integrating sustainability into our operations, and it's promoting access to responsible investments. If we shift now to closing to our final slide, the JSE distinctive value proposition. And before I move and close to Q&A, I just want to remind you of the key tenets of the JSE investment case. Operationally, the business remains well supported by a robust technological setup, whilst offering effective regulation and deep liquidity to market participants. This is a key long-term competitive strength for the JSE and something we are incredibly proud of. Meanwhile, we've continued to generate high and stable levels of cash and to maintain strong financial and cost discipline despite a volatile market environment. Once again, this has allowed us to maintain a healthy balance sheet, good growth optionality. And with this offering, historically a high dividend payout for our shareholders. and meanwhile, we continue to progress on our inorganic growth strategies and other strategic priorities in order to diversify our business mix. This is being done whilst embedding sustainability into our strategy in order to deliver long-term sustainable value to shareholders. Thank you all so much. This really brings our formal presentation at an end. We're now going to open questions and answers, and I'm going to ask you to please send your questions through to the e-mail group that you've received in your communication. Romy will read those questions out and Aarti and I and any other relevant colleagues will respond.

All right. We're back and ready to take any questions, Romy, do we have any questions.

Nothing at the moment, Leila, just give it a few more minutes. You've reduced pricing and kept it low for a number of years. How sustainable is that from a margin standpoint?

Great, great. Thank you, Romy. And the question is that we've reduced pricing and how sustainable is this to our margins? Of course, margins are a function of both pricing and volume and value traded. We've seen a systematic increase in our volume and value traded over the past couple of years, of course, off a very highly event-driven market. Our pricing had reduced over a number of years to ensure that we remain competitive and cost-effective. We are now, more or less, on par for our trading and clearing and settlement. Of course, we remain under pressure in the BDA pricing environment. We don't expect massive price changes across our large counters in the short to medium term. There have been marginal responsive changes, which have had a very immaterial effect on our bottom line, but have had a particularly good effect in managing the services that we offer. We remain at above 99% of market share, and so we'll continue to monitor this. As I have said to both the market and shareholders repeatedly, we will look to address our BDA business line. What we are wanting to do is ensure that we diversify our revenue source and build up an annuity income. We are starting to see the results of that, particularly this year in our top line. And as that continues to evolve, it will give us a little bit more pricing flexibility, particularly in BDA. You will note that we didn't increase our BDA fees last year. However, volume traded has gone up, and that would be margin accretive.

Great. We've got a question from [Carlos Silver]. He says, hi Leila and Aarti. First, let me congratulate you on a great second half of the year. My question is on the new plan for Information Services. With your transition into the cloud, do you expect to earn higher margins on the segment? And how long do you believe it will take to complete that transition and for us to see those potential benefits?

[Carlos], thank you for that question, and thank you for your comments. We are indeed incredibly pleased with the second half of the year uplift and particularly in how that's translated into shareholder value, both in the share price growth over the last couple of days and of course, in the 4% increase in [odd] and the special divi. Insofar as our information services strategy goes. We've spent an enormous amount of time with our Board discussing what is a 5-year plan. We are looking for a number of quick wins. We believe that building cloud-native and digitized solutions is the way to go. We are very intrigued with some of the announcements by CME linking up with Google, NASDAQ linking up with Amazon Web Services. And we are investigating what that means for us. Of course, cloud-native or cloud friendly is going to be a key priority. We -- while we can't give a definitive answer on the delivery of the full-scale strategy because it is a 5-year strategy, we have tried to front-load some key milestones in the next year or 2, and we expect that, that will be revenue accretive. We plan to grow this business through a combination of bolt-on inorganic business accelerators, as well as organic new product development. We have already tested our pre- and post-trade analytics solution, which is more of an open API environment and we've had tremendously positive response. One of the big tenets of this strategy is to expand the constituents to whom we distribute and sell our data to beyond our traditional set, so thereby expanding our reach and diversifying our revenue source. Of course, you would be aware that more than 60% of our Information Services revenue is paid in dollars, and that gives us a really good dollar hedge, particularly given that some of our software costs are in dollars.

Thank you, Leila. We've got a question from [Collin Smith]. He said to us, the increase in margin deposits seems well in excess of the increase in derivative income. Please, could you provide a bit more information on that?

So I can provide some color on that, [Collin]. The margin deposits is a snapshot. So it is a balance at point in time on the balance sheet. Definitely it has increased, but we've really got to look at the related revenue in average terms across the year. What we do is we take it, but charge on the capital balance over the year. And of course, that fluctuates at different points in time throughout the year. It's also recorded differently within JSE Trustees and very different in JSE Clear, so maybe we could engage on that further offline.

Thank you, Aarti. We have another question here from [Arthur]. Thank you for the sound and comprehensive presentation. There seems to be a perception that the JSE has lost touch with its customers and it has become an organization of professional managers. There is a perception that the relationship with your customers and their needs has been eroded. Would you like to comment?

Thanks for that. And perhaps I can just point to our NPS score. Of course, during volatile and difficult market conditions, it puts pressure on the entire market. What I can say is that our NPS -- our customers are at the center of everything that we do. We wouldn't have a business were it not for our customers. Our NPS score of last year is at an all-time high. We have -- I spent personally an incredibly large amount of time across all constituents of stakeholders engaging, and that sets the tone for all the way through. Our uptime and our resilience and the service that we've given is always paramount and we place an enormously high priority. So I would be very happy to have a cup of coffee separately and to chat, to hear about what you think we can do better. Of course, this is really a genuinely important priority, and it's particularly important during volatile times, when members or issuers or participants are facing uncertain and choppy trading conditions.

Thank you, Leila. We have another question from [Collin Smith]. He asked when do you expect the transition or the sustainable bonds and private placements to generate revenue?

We -- in terms of transition bonds, we are planning to launch that. So it is very difficult to predict the revenue. In terms of our private placements market, this is a brand-new market. We've had extremely good response in the sort of months that we've been beginning to launch and start to operate. From the investor side, we have already signed up a sizable number of investors. We have a couple of issuers that are imminent over the next couple of months. This is a long line of vision, and it is going to take us time to start to build momentum and accelerate. That said, we have had tremendously positive support. We are interacting with both local and investors and issuers on the country in both private and public sector. And I can assure you that this is getting the top level attention. So it's very difficult for us to present you with our specific deposits, but we are seeing momentum just starting to build in this product set.

Thank you, Leila. At this point we don't have any further questions, we can give it maybe another minute.

Great.

Leila, can you walk us through some of the initiatives you have planned on the sustainability front for 2022?

Certainly, as I said earlier, the sustainability front is a really important product set for us. You would be aware, I mentioned that we launched the public disclosure framework. We hope to finalize that and issue a final framework. Of course, the important thing here is that we need to link in to global precedent. The national accounting bodies -- global accounting bodies are looking at global approaches to our -- to our disclosure, and we'll certainly align with that. We will continue to work with government as we have done to ensure that the -- that we're able to contribute to the funding that was granted to South Africa in COP, and that we can potentially provide products that enable that. Of course, we will be responsive to what happens in the marketplace. Blue bonds to fund water could, of course, be a solution, but we don't want to create a wide plethora. So with regard to potential mandating of the disclosure standards, we will be led by global precedent. It does appear that global accounting bodies are starting to move in that direction. But at this stage, it's early days. We also play an important role on the global front. And one of the areas that I've been advocating quite strongly on in the net zero, is the importance of taking account of the emerging market social dynamics. So the shift to climate change needs to ensure that we don't have stranded assets. And that if we have any indices or any new products evolving, that those products need to take account of transition bonds or transition plans. Transition bonds, as you know, will be launched imminently, and we are particularly excited with that.

The sustainability segment statistics, so we launched the sustainability segment in July 2020. And by the end of the year 2020 there were 12 issuances with a total of approximately ZAR 9 billion issued. By the end of last year, 2021, this has grown to 36 issuances with approximately ZAR 20 billion in issuance. So -- and today, there are 42 in total with over ZAR 21 billion issued. So we are generating some activity and some revenue, but not in material terms that you could pencil that in as a material line item yet.

Thank you very much, Aarti and Leila. That seems to be a wrap on the questions front. So thank you.

Excellent. On behalf of the Board and my fellow CFO and the rest of the JSE, I'd like to just take this opportunity to thank the shareholder, media community, our members and stakeholders and regulators for the tremendous support that we've had during what continues to be a challenging and uncertain economic environment. We are very pleased with our robust results, and we are particularly pleased with the strong balance sheet, the high levels of capitalization, which provide for a prudent systemic management. And for the organization, I'd like to take the opportunity to thank our staff who have been responsive, resilient and whose motivation levels are reflected in an all-time high internal staff engagement score. And we look forward to engaging you on a one-on-one basis. Thank you so much for listening.