Moscow Exchange's net profit under Russian accounting standards for the nine months fell by more than a quarter. For shareholders, this is an alarming signal: the steepest declines were in dividends and income from participation in other companies, which account for the bulk of the platform's income.
At the same time, the venue's commission business is showing steady growth: revenue from services added 16.9%. This is a good sign for investors — the exchange's core operating activity is generating more money even amid falling investment income.
Where the profit decline came from
Net profit for January–September amounted to RUB 61.61 billion, while in Q3 it declined 5.5% year-on-year to RUB 2.22 billion.
The exchange's trading and investment income fell 26.2% to RUB 62.68 billion and became the main reason for the decline. Dividends and income from participation in other organizations dropped 29% to RUB 55.93 billion. Interest income decreased 17% to RUB 5.56 billion.
Revenue from services and commission income, by contrast, grew 16.9% to RUB 25.35 billion. However, expenses also increased noticeably: direct operating costs jumped 59.7% to RUB 7.73 billion. General and administrative expenses rose 12% to RUB 8.01 billion, and personnel costs grew 2.4% to RUB 10.13 billion.
In Q3, trading and investment income amounted to RUB 2.26 billion versus RUB 2.88 billion a year earlier. Commission revenue for the same period increased 20.5% to RUB 8.73 billion, that is, faster than the nine-month average.
What else is happening around the Moscow Exchange
The launch of trading in BTC, ETH and USDT, which the Moscow Exchange will open on December 1, could become a new source of commissions. According to the exchange's senior managing director Boris Blokhin, pilot trades will take place from 6:50 to 23:50 Moscow time on the equity market basis, which will reduce participants' costs.
Not only investors but also issuers bring income to the exchange, and the Central Bank believes this affects its position. The regulator's first deputy chairman Vladimir Chistyukhin reproached the Moscow Exchange for more often supporting companies than private investors and linked such caution to the desire to retain clients.
The dispute over investor protection also concerns the quality of reporting, which auditors check. Sergei Shvetsov of the Moscow Exchange proposed radically reducing their number, while Chistyukhin advocated a higher threshold for entry into the Central Bank's register while maintaining competition.
Cryptalist analysis: The divergence between growing commission income and falling net profit reflects a structural shift in the Moscow Exchange's model: the operating business is strengthening, while the investment portfolio is losing profitability amid market volatility. The launch of cryptocurrency trading could partially offset pressure on profit, but the outpacing growth of operating costs requires close monitoring. For institutional investors, the key indicator will remain the sustainability of the commission flow amid regulatory friction with the Central Bank.