The Bucharest Stock Exchange proceeds with its restructuring, despite seeing its profit double

• The BSE invested 64 million lei in bank deposits and government bonds

The Bucharest Stock Exchange (symbol:BVB) saw its profit nearly double YOY in the first semester of 2010, to 4.37 million lei, as its turnover increased 56%, to 8.48 million lei. For comparison, in H1 2009, the BSE had a profit of 2.62 million lei, for a turnover of 5.41 million lei.

In spite of the increase in earnings compared to 2009, at the end of July 2010, the Board of Directors of the Stock Exchange announced that it would implement several measures to restructure the company"s operations in order to cut employee costs by approximately 10%.

Anca Dumitru, the general manager of the BSE, said for BURSA that the restructuring of the BSE"s operations will proceed as plan: "Cost cutting was a priority of the BSE in 2009 as well. Compared to the previous year, we succeeded in making major progress in this respect. The preoccupation for the improvement of the operations of this company, even more so now that we are a public company, is a natural concern of the management. We have already implemented some new cost cutting measures and we will continue in this direction", said Anca Dumitru.

In the first semester of 2010, the operating revenues of the company increased to 8.59 million lei, up 58.7% YOY, whereas operating expenses decreased slightly from 6.68 million lei at the end of June 2009, to 6.2 million lei at the end of June 2010. As a result, the BSE made an operating profit of 2.39 million lei. In the first semester of 2009, the BSE had posted an operating loss of 1.26 million lei.

The financial revenues of the company followed a downward trend in H1 2010, dropping 33% to 2.93 million lei. At the same time, the company"s financial expenses amounted to 95,754 lei, leading to a profit of 2.83 million lei.

For comparison, in H1 2009, the BSE had a financial profit of 4.46 million lei.

At the end of June, the BSE had over 4.3 million lei in debt, down 47.49% compared to the similar period of 2009, whereas the company"s receivables increased 57%, to 2.12 million lei.

The Bucharest Stock Exchange self-listed in the beginning of April 2010, and has a market capitalization of 228 million lei, based on yesterday"s closing price of 29.8 lei.

At the end of June, the BSE only had 226,517 lei in its accounts, unlike in the beginning of the year, when it had 64 million lei in cash.

"In December 2009, the financial investments consisting of term deposits had come to maturity meaning the BSE had all its financial resources in its current accounts. In the beginning of 2010, the company placed all its money in deposits and in government bonds.

The BSE only records the amounts that it needs for its day-to-day operations in its current accounts (petty cash and cash at bank). The remaining amount goes into short term investments", the general manager of the BSE explained.

At the end of June, the Bucharest Stock Exchange had short term investments amounting to 63.9 lei.