bucharest stock exchange ir update update may 2015.pdf 6 investments limits of pf per instrument...

Bucharest Stock Exchange

IR UpdateMay 2015

2

Contents

www.bvb.ro

1. Romanian Capital Markets Overview 3

2. Targeting the Emerging Markets Status 9

3. Business Outline 14

4. Financials 20

5. Share Statistics 29

6. Financial Calendar and Contacts 31

Romanian Capital Markets Overview

www.bvb.ro 4

Indicator 2010 2011 2012 2013 2014 Most recent Reported for

Real GDP, yoy change [%] (0.8) 1.1 0.6 3.4 2.8 4.3 1Q 2015

Inflation rate, annual [%] 6.1 5.8 3.4 3.2 1.07 0.65 Apr 2015

Key interest rate [%] 6.25 6.00 5.25 4.00 2.75 1.75 7 May 2015

Population [mn] 20.3 20.2 20.1 20.0 20.0 20.0 2014

Exchange rate, eop [RON/EUR] 4.3 4.3 4.4 4.5 4.5 4.4 31 Mar 2015

Positive macroeconomic outlook


Long Term Credit Rating Credit ratings Outlook

Standard & Poor’s BBB- stable

Moody’s Baa3 stable

Fitch BBB- stable

Source: Eurostat, NBR, National Statistics Office, rating agencies, FESE, BVB

Market

Domestic market cap [EUR bn] MCap vs GDP [%]

2012 2013 2014 2014

Bulgarian Stock

Exchange5.0 5.1 5.0 11.9

CEESEG -

Budapest15.7 14.4 12.0 11.6

Bucharest Stock

Exchange12.1 17.8 18.4 12.3

CEESEG - Prague 28.2 22.0 22.6 14.6

5

Romanian capital markets at a glance

www.bvb.ro

Source: FESE, BVB

EUR 63 mn10% stake

new shares

Sept 2013

EUR 444 mn10% stake

new shares

Jun 2014

EUR 18.2 bn, +68%Domestic MCap, end-Mar 2015, compared to Jan 2012

EUR 4.4 bnMCap added from IPOs in 2013-2014

EUR 7.5 mn/dayAvg. daily traded value (equities) in 1Q.2015


* 2015 figure calculated using prices as of 14 May 2015 and dividends to be paid in 2015

from 2014 net profits

EUR 383 mn15% stake

existing shares

Oct 2013

5.5%Extra-return of BET-TR index vs. BET in 2014

6.6%Avg. 2015 DivY for the largest 6 energy & utilities companies*

www.bvb.ro 6

Investments limits of PF per instrument type

• State bonds RO, UE or SEE: max. 70% of total assets

• Bonds/transferable securities issued by the local public

administration in RO, EU or EEA, traded on a regulated market in

RO, EU or EEA: max. 30% of total assets

• Securities traded on a regulated market in RO, EU or EEA: max.

50% of total assets

• Monetary market instrument: max. 20% of total assets

Investments limits of PF per issuer

• Exposure to one company: 10% of total assets

Growing pension fund industry


Source: FSA

Bank Deposits4.0%

Government Securities

68.1%

Bonds4.5%

Shares19.1%

Other4.3%

Pillar II asset structure Dec 2014 [%]

Bank Deposits4.6%

Government Securities

66.1%

Bonds5.1%

Shares21.5%

Other2.8%

Pillar III asset structure Dec 2014 [%]

1.6

2.3

3.3

4.5

2011 2012 2013 2014

Total assets, 2011-2014 [EUR bn]

www.bvb.ro 7

Supportive asset management industry

Key developments

• Strong growth rate of net assets in 2014, continuing the trend set

in previous two years

• 28% growth in net assets in 2014, after the strong 43% advance in

2013

• The Asset Management industry gained almost 40,000 investors

during 2014

• In the current low interest rate environment, the trend set over the

last 1.5 years is set to continue, as investors would become

increasingly interested in such investments to capture higher yields

Asset structure

• Government bonds and bank deposits cumulate 77% of net assets

• The weight of corporate bonds is 17%

• Listed shares continue to account for more than 5% of net assets

• Value of investments in listed shares was approx. 240 mil. EUR at

the end of 2014


Source: AAF

Government bonds51.7%

Bank deposits25.2%

Corporate bonds15.6%

Listed shares5.2%

Other2.3%

Asset structure Dec 2014 [%]

3.0 3.44.8

6.2

325,566 332,904363,517

402,984

150,000

200,000

250,000

300,000

350,000

400,000

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

2011 2012 2013 2014

Net assets [EUR bn],

number of investors, 2011-2014

Total assets [EUR Bn] Total number of investors

8

Ambitious targets for growing in the region

www.bvb.ro


MCap: EUR 18.2 bn

Avg. daily turnover: EUR 7.5 mn/day

Bulgarian Stock Exchange

MCap: EUR 4.4 bn


CEESEG Vienna

MCap: EUR 90.6 bn


CEESEG Budapest

MCap: EUR 14.5 bn


CEESEG Ljubljana

MCap: EUR 6.2 bn


Warsaw Stock Exchange

MCap: EUR 155.7 bn



Source: FESE (data as at end-March 2015); for BVB public offers are not included

CEESEG Prague

MCap: EUR 24.3 bn


Targeting the Emerging Markets Status

www.bvb.ro 10

Targeting the upgrade to Emerging markets status (1/2)

FTSE criteria for Secondary Emerging MarketsMSCI criteria for Emerging markets

B. Size & Liquidity Minimum Requirement

B.1 Number of companies meeting the

following Standard Index criteria3

Company size [full market cap]* USD 1,260 mn

Security size [float market cap]* USD 630 mn

Security liquidity 15% ATVR**

C. Market Accessibility Minimum Requirement

C.1 Openness to foreign ownership Significant

C.2 Ease of capital inflows/outflows Significant

C.3 Efficiency of the operational framework Good & tested

C.4 Stability of the institutional framework Modest


*Minimum in use for the May 2014 Semi-Annual Index Review, updated on a semi-annual basis

**Annualized Traded Value Ratio

Source: MSCI

MSCI will only consider a market for reclassification for which a change in

classification status can be viewed as irreversible. Every June, MSCI will

communicate its conclusions from the discussions with the investment

community on the list of countries under review and announce the new

list of countries, if any, under review for potential market reclassification in

the upcoming cycle.

FTSE defines both country eligibility and development status in terms of

21 separate criteria in four broad areas: Market and Regulatory,

Environment, Custody and Settlement, Dealing Landscape, Derivatives.

FTSE Quality of Markets Criteria Rating

Formal stock market regulatory authorities

actively monitor market (e.g., SEC, FSA, SFC) Pass

No objection to or significant restrictions or

penalties applied to the investment of capital or

the repatriation of capital and income

Pass

Settlement - Rare incidence of failed trades Pass

Custody-Sufficient competition to ensure high

quality custodian services

Pass

Clearing & settlement - T + 3 Pass

Brokerage - Sufficient competition to ensure

high quality broker services

Pass

Liquidity - Sufficient broad market liquidity to

support sizeable global investment

Pass

Transaction costs - implicit and explicit costs to

be reasonable and competitive

Pass

Transparency - market depth information /

visibility and timely trade reporting process

Pass

Source: FTSE

www.bvb.ro 11

Targeting the upgrade to Emerging markets status (2/2)

STOXX criteria for Emerging Markets

The STOXX country classification model relies on a rules-based

methodology, and is the first such concept to exclude any subjective

decisions from the process. The five criteria for the classification of a

country as developed or emerging markets include macroeconomic data,

market capitalization, market liquidity, free currency convertibility on

onshore and offshore markets, and restrictions on capital flows.

S&P Dow Jones criteria for Emerging markets

Initial Eligibility Criteria Requirement

Full domestic market capitalization over

$2.5B √

Domestic annual turnover value over $1B √

Exchange development ratio (market cap to

GDP) over 5% √

Additional Criteria Requirement

Full domestic market capitalization over

$15B √

Settlement period of T+3 or better

Minimum

of three √

Sovereign Debt rating of BB+ or above

Non-occurrence of hyperinflation

No significant foreign ownership

restrictions

Freely traded foreign currency

Source: S&P Dow Jones Indices

STOXX Selection Criteria Requirement

1: IMF Country Classification (Source: IMF - International

Monetary Fund)

optional;

1 or 3a+b

2a: Market Capitalization Screening (Source: World Bank)

Definition: The remaining countries must have a market

capitalization that exceeds USD 15 billion to be eligible as

Developed or Emerging Markets.

mandatory

2b: Liquidity Screening (Source: World Bank)

Definition: The total value of shares traded must be higher

than USD 15 billion.

mandatory

3a: Free Currency Convertibility on On-Shore and Off-

Shore Markets (Source: PwC)

optional;

3a+b or1

3b: No Restrictions Capital Flows (Source: PwC)

optional;

3a+b or 1

Source: STOXX

S&P Dow Jones Indices uses quantitative criteria as a guide to

classifying countries but the opinions and experiences of global

investors are equally important.


12

8 Barriers impeding the development of the capital markets

www.bvb.ro

• Eliminate English translation for required documents

• Recognize authorized representatives in CSD

1. Getting access to the market

• No reporting when nil profit tax

• Simplify fiscal compliance procedures2. Investors’ fiscal compliance

• Ease voting procedures-introduce general PoA

• Eliminate affidavit given by custodians

3. Not respecting corporate rights of the investors

• Create a centralized system of paying dividends

4. Lack of EU standards for servicing investors’ rights for

dividends

• Clarify stock borrowing & lending fiscal regime

• Introduce Short Sell transactions concept

5. Unclear taxation issues related to capital markets

transactions

• Eliminate mandatory wait periods during public offers

• Simplify the approval procedures by ASF and BVB6. Primary market

• Withholding tax exemption for corporate bonds

• Corporate bonds to be governed solely by their terms7. Bond market

Fiscal Procedural Code

NSC Regulation No. 1/2006 on issuers and

securities operations

NSC Regulation No. 6/2009 on exercising

certain rights of shareholders

NSC Regulation No. 32/2006 concerning

financial investment services

NSC Regulation No. 13/2005 on the

authorization and operation of central

depository

NSC Regulation No. 5/2008 on AML

Law No. 85/2006 on insolvency procedure

Law No. 2097/2014 on the capital market

‒ Fiscal Code

‒ Law No. 31/1990 on companies

Regulatory framework

Approved

‒ Awaiting approval


www.bvb.ro 13

Measures taken by the Bucharest Stock Exchange to

improve liquidity and market infrastructure

New Market Making program

BVB fees reduction and improvement of market depth

Reshuffle of BVB market indices

Introduction of reporting & disclosure obligations for BET issuers

Removal of the odd-lot market segment

Enhancement of trading mechanism & schedule

Reduction of trading interruptions and improved information flows

Enhancement of issuers area, transformed market segmentation, a new Corporate Governance framework

Introduction of new trading models (continuous / auction)

Development of new information channels, a new website and mobile and tablet apps

Implementation of T+2 settlement cycle

Separation of trading/settlement systems

Targeting the Emerging markets status


Business Outline

www.bvb.ro 15

BVB investment highlights

Business Outline

Operator of the leading Romanian spot market

Integrated Group: Trading, Clearing, Settlement and Registry Systems

Listed company with a market cap of EUR 64 mn (end Mar-2015)

100% free-float, no major shareholder

Rich cash position, zero leverage

Stable dividend policy with 100% payout ratio, after legal reserves

www.bvb.ro 16

Markets operated by BVB

Business Outline

Regulated Market

Shares and rights (local and international companies)

Corporate and municipal bonds

Government securities

Structured products

Fund units

Tradable UCITS (ETFs)

AeRO for equities

(Alternative Trading System)

Shares of Romanian companies

Rasdaq Market

Shares and rights issued by Romanian companies, mainly

from the mass privatization program

www.bvb.ro 17

Recent events

Business Outline

New market segmentation & criteria for BET enter into force

Emergency Ordinance no. 90/2014 enters

into force

BVB offers 13 awards to contributors to the development of the

capital market in 2014

2nd event “Romanian Capital Market – Up

the Ladder to Emerging Market”

Direct fiscal registration used for the first time

The auction trading model is

introduced

AeRO market is launched. First 2 companies listed

2nd edition of the BVB Individual

Investors Forum

2 settlement cycles are introduced

Concorde Securities (Hungary) becomes a

member at BVB

BET-XT-TR index is launched

BVB participates at the 10th edition of the World

Exchange Congress

First 3 companies transferred from Rasdaq to AeRO. BVB becomes member of UN

Sustainable Stock Exchanges initiative

2nd Romania Investors Days event

in New York

BET-FI Index Invest starts

trading

1 Jan

9 Jan

2 Feb

4 Feb

16 Feb

23 Feb

25 Feb 2 Mar 18 Mar

23 Mar 27 Mar27-28 Feb

24-25 Mar 30-31 Mar

31 Mar

6.7

10.211.7

7.5

1.3

1.30.9

6.00.6

0.50.2 0.4

2012 2013 2014 2015

Average daily turnover 2012-2015 YTD*[EUR mn/day]

Shares/Fund Units Bonds Structured products

www.bvb.ro 18

Market size and structure

Business Outline

* The chart is rebased to 100* Public offers included. 2015 value until 11 May 2015

• Since jan 2015, BET and its total return version BET-TR moved

together, as no dividends were accounted for by BET-TR over the

1st quarter.

• On a relative basis, BET-TR continued to outperform BET by 5.4pp,

as in 2014.

• For 2015, the performance of BET-TR will be supported again by

strong dividend yields offered by Romanian companies. The

average dividend yield paid this year by the largest 6 energy &

utilities companies is around 6.6%*.

38%

8%

*Public offers not included. Data for 1 Jan - 31 Mar 2015

+14.3%

+9.0%

* 2014 figure calculated using ex-date prices and dividends paid in 2014 from 2013 net profits.

2015 figure based on dividends to be paid from 2014 net profits and prices as of 14 May 2015

Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15

BET and BET-TR indices, Jan 2014-Mar 2015

BET BET-TR

8%

Fondul Proprietatea, 27.1%

Romgaz, 15.1%

Banca Transilvania, 11.9%BRD Gr-Soc. Gen, 9.6%

OMV Petrom, 7.0%

Transelectrica, 5.7%

Electrica, 5.6%

Others, 18.0%

Most traded stocks at BVB in Jan-Mar 2015 [%]

www.bvb.ro 19

Investor accounts and participants on the local market

Business Outline

• The current compensation limit is EUR 20,000, in line with EU

directives

• More than 90% of investor accounts have portfolios below EUR

20,000 and are fully compensated

• The number of investor accounts includes the total number of

accounts on the Romanian capital market, regardless if an investor

has accounts with several brokers

Source: BVB survey among Romanian brokerage companies accounting for ~98-99% of total

market turnover (percentages calculated using the investors’ traded values), FCI, BVB

35% 36% 34% 33%

30% 29% 27% 30%

25% 26% 31% 24%

8% 6% 6% 10%3% 4% 2% 3%

1H.2013 2H.2013 1H.2014 2H.2014

BVB Investor base

EU Local legal entities Local retail US Others

88,14381,559

85,381

74,571

Dec-11 Dec-12 Dec-13 Dec-14

Number of investor accounts 2011-2014

Fully compensated investors Ceiling compensated investors

Excluded investors Total no. of investors

61 54 45 40

50.9%56.8%

71.8% 71.7%

0%

10%

20%

30%

40%

50%

60%

70%

80%

0

20

40

60

80

100

2011 2012 2013 2014

Number of participants and market share of Top5, 2011-2014

No of participants Market share of Top5

Financials

www.bvb.ro 21

Activities within BVB Group:

• Bucharest Stock Exchange – Trading, spot & derivative

• Central Depository – Spot market clearing & settlement, registry

• Bucharest Clearing House – Derivatives market clearing

• Investors Compensation Fund – Compensation mechanism to the

investors in case of a member failure

• Corporate Governance Institute – Education activities

Holdings and shareholders


100% free float

Central Depository

69.04%

Bucharest Clearing House

52.5%

Investors Compensation

Fund62.3%

Corporate Governance

Institute100%

Bucharest Stock

Exchange

100% free float

Central Depository

69.04%

Bucharest Clearing House

52.5%

Investors Compensa-tion Fund

62.45%

Corporate Governance

Institute

100%

Financials

Source: BVB, Central Depository, EBRD, SIFs

According to the current provisions of the law, no market operator

shareholder shall hold directly or indirectly more than 20% of the total

voting rights.

The main shareholders are:

• SIF Transilvania – 5.079% (Jan 16, 2015)

• ING Groep N.V. – 5.57% (Jan 15, 2015)

• European Bank for Reconstruction and Development (EBRD) –

4.99% (Nov 19, 2014)

• SIF Moldova – 5.00% (Dec 31, 2014)

• SIF Muntenia – 4.32% (Dec 31, 2014)

• SIF Oltenia – 5.00% (Dec 31, 2014)

Romanian legal entities, 69.7%

Foreign legal entities, 17.6%

Romanian private individuals, 12.0%

Foreign private individuals, 0.6%

Shareholders' structure as at March 31, 2015

www.bvb.ro 22

Budgeted indicators for 2015

Expectations for 2015

• Trading revenues to remain the main source of operating revenues,

with shares generating most of the turnover

• Trading value for the shares on the Regulated Market: RON 15 bn

in 2015 (up 15.2% y-o-y)

• Average trading value including public offers: RON 59.4 mn

(increase by 13.9% y-o-y)

• We expect that the trading with fixed-income instruments will

attract higher interest given the launch of government securities

dedicated to retail investors and the increased willingness of

companies and municipalities to seek financing through bond

issues

• Migration of Rasdaq companies to the Regulated Market/AeRO is

expected to positively influence both trading revenues and

revenues from issuers fees

• Operating expenses are expected to register a minor decline to

RON 17.1 mn, with personnel costs accounting for half of the

amount

• Operating profit: seen higher by 12% y-o-y, with an operating

margin of 43%

Financials

Note: Trading values include public offers

27.9

11.1 11.9

29.6

12.5 13.8

Operating revenues Operating result Net profit

Main financial indicators [RON mn]

2014 Budget 2015

13.0

1.0 0.2

15.0

3.1

0.5

Shares Regulated Market Bonds & Gov't Securities Structured products

Trading value for the main markets [RON bn]

2014 Budget 2015

+6%

+12% +16%

+15%

+230%+105%

8.1

11.1

1.2

4.7

2.92.3

0.2

2013 2014 1Q.2014 2Q.2014 3Q.2014 4Q.2014 1Q.2015

Operating result [RON mn]

24.326.9

4.6

8.55.8

8.0

4.1

2013 2014 1Q.2014 2Q.2014 3Q.2014 4Q.2014 1Q.2015

Sales revenues [RON mn]

www.bvb.ro 23

• The 1st quarter trading activity was lower on a y-o-y basis. Lower

trading fees also took a toll on operating revenues.

• Encouraging figures came from trading of fixed income and

structured products, both on an upward trend. Apart from trading,

IT services, data vending and issuers fees were also on the rise, but

not enough to counted above-mentioned negatives.

• The continuous efforts to promote the local capital market were

mirrored by higher costs, weighing down on operating profitability.

• The net profit reported for the first 3 months was RON 1.62 mn,

17% higher in y-o-y terms, mostly supported by financial revenues.

Building on a favorable background

Financials

+11%

+37%

+25%

-13%

-79%

9.5

11.9

1.4

4.3 3.72.6

1.6

30%

50%

64%

32% 40%

-20%

0%

20%

40%

60%

80%

0

2

4

6

8

10

12

2013 2014 1Q.2014 2Q.2014 3Q.2014 4Q.2014 1Q.2015

Net result and net margin

Net result [RON mn] Net margin [%]

4.8

8.5

6.2

8.5

4.3

1Q.2014 2Q.2014 3Q.2014 4Q.2014 1Q.2015

Quarterly operating revenues [RON mn]

www.bvb.ro 24

• Trading revenues continued to account for most of the operating

revenues, but their weight decreased to 83% in 2014.

• Issuers fees increased by 12% y-o-y to RON 1.5 mn, due to fees

paid by new companies and the new schedule of fees for

structured products.

• The IT development area became more represented during 2014,

given the significant market infrastructure projects, the trading

system improvements and the development of BVB’s website.

Revenues structure

Financials

-10%

14.2

21.223.1

1.3

1.3

1.5

1.4

1.3

1.2

0.6

0.6

2.1

2012 2013 2014

Breakdown of operating revenues [RON mn]

Trading Listing Data vending Other revenues

• Trading activity for the stock market slowed to RON 2.1 bn in

1Q.2015, with a positive trend observed for fixed income

instruments and structured products. The decline in trading revenues

was partly attributable to the lower fees enforced in Oct 2014.

• Issuers fees increased due to fees paid by companies from Rasdaq

seeking admission to trading on AeRO.

• IT services revenues tripled in y-o-y terms to due to services

provided to the Central Depository within the capital market

development projects, while the data vending business started

building momentum with new contracts signed directly with vendors.

21.223.1

3.9

7.7

4.96.7

3.0

2013 2014 1Q.2014 2Q.2014 3Q.2014 4Q.2014 1Q.2015

Trading revenues [RON mn]

13.514.4

2.4

5.8

3.1 3.12.3

2013 2014 1Q.2014 2Q.2014 3Q.2014 4Q.2014 1Q.2015

Trading value shares, bonds and structured products* [RON bn]

www.bvb.ro 25

Traded value and trading revenues

Main drivers of the trading revenues

• In 2014, trading activity continued to rise as investors became

increasingly interested in Romania’s progress and market reform,

aimed at accessing the Emerging market status. The average daily

trading value for the stock market, excluding public offers, was

RON 39 mn, 22% higher y-o-y.

• 2014 also featured the largest IPO in BVB’s history. A 51% stake in

Electrica was sold for EUR 444 mn (newly-issued shares), also

becoming one of the largest deals in Europe for the year.

• During 1Q.2015, the total trading activity including public offers

declined by 4% y-o-y to RON 2.3 bn. Lower equities trading was

partly countered by fixed-income and structured products markets

which registered higher turnovers.

• Apart from trading volumes, changes in pricing policy were

another determinant of BVB’s trading revenues, mostly visible in

1Q.2015 figures. On October 1, BVB lowered its trading fees for

regular trading of shares, bonds, structured products and other

instruments. The positive effect for the market was the strong

reduction of Deal trades as percentage of total trading value,

mostly visible in the regular stock market where Deal trades

decreased to 18% of total turnover in both 4Q.2014 and 1Q.2015.

Financials

-4%

-21%

+7%

+9%

* Public offers included

13

5

11.7

4.5

10

4

88

6

Sell Buy Sell Buy Sell Buy

Historical trading fees (bps)

www.bvb.ro 26

Lower trading fees charged by BVB and FSA

Notes:

* Starting Sept 16, 2014 the FSA fee for the buy side of trades decreased to 6 bps from

8 bps

** BVB’s new fees as of Oct 1, 2014 apply for Regular, Odd Lot, Rasdaq, ATS, Unlisted

markets. Deal market fees remain unchanged

*** Fees in bps are charged to the value of the trade (buy & sell)

**** BVB and FSA fees do not refer to Market Makers

BVB trading fees

Sell Buy

Shares, fund units,

certificates10 bps 4 bps

Bonds 1 bp

T-bills 0.04 bps (RON 1-10)

BVB annual maintenance fees

Participants EUR 333 / RON 1,500 (VAT included)

IssuersEUR 800 – 4,667

RON 3,600 - 21,000 (VAT not included)

BVB public offers fees

For sale of shares 0.135% (for the seller)

For purchases of shares 0.216% (for each side of the trade)

For initial sale offers of bonds 0.007% (for each side of the trade)

For secondary sale offers or

for purchases of bonds0.0216% (for each side of the trade)

Financials

FSA fee for buy side

Oct-08 – Feb-09 Mar-09 – Sep-14 Since Oct-14

BVB fees for buy & sell sides

3.53.8

3.2

6.2

4.0

1Q.2014 2Q.2014 3Q.2014 4Q.2014 1Q.2015

Quarterly operating expenses [RON mn]

www.bvb.ro 27

• Operating expenses for 1Q.2015 increased to RON 4.05 mn in y-

o-y terms, driven primarily by higher promotion and marketing

expenses, depreciation and personnel costs.

• BVB hosted and partnered in organizing key investor events,

including those dedicated to the new AeRO market, all mirrored in

the marketing costs increase.

• Depreciation charges continued to increase, following the

acquisitions of fixed assets and the finalization of development

projects. The declines of non-deductible VAT and other costs were

insufficient to cover the previously mentioned increases.

• Personnel expenses continued to account for more than half of

total operating expenses in 2014, at 53%.

• Marketing & promotion costs increased gradually over the past year

as percentage in total expenses (to 9.2%) as efforts to put the local

market on investors’ map were intensified.

• Recent investments have led to 13% y-o-y higher depreciation

charges (excluding any other one-off items), while their weight in

total operating expenses increased slightly to 4.6%.

Expenses structure

Financials

+14%

-0.60.1

0.10.6

0.00.8

6.89.1

8.9

3.7

3.1 2.41.7

1.7 2.00.9

1.2 1.10.4

1.1 1.5

2012 2013 2014

Breakdown of operating expenses [RON mn]

Provisions Depreciation Personnel costs

Other operating exp. Functioning VAT and FSA fees

Marketing

www.bvb.ro 28

• Debt-free capital structure

• Cash and equivalents were RON 32 mn as at end-Mar 2015, of

which 96% were invested in bank deposits

• Cash & equivalents have declined gradually since 2013 as long-

term bonds were gradually acquired and classified as non-current

assets, which reached RON 39 mn at the end of 1Q.2015

• ROE was 11.8% in 2014, up 2.1pp compared to 2013

• Stable dividend policy, with a payout ratio of 100%, after legal

reserves

• The dividend policy is seen to remain unchanged

Individual balance sheet overview – as per statutory accounting

Financials

Note: Romanian Accounting Standards, acc. to EU Directive No 4 * Gross dividends are presented.

Dividend yields are calculated using the price on the corresponding ex-date, except for 2014,

where the closing price as of 14 May 2015 was used.

RON mn 2013 2014 Mar 2015

Non-current assets 61.5 71.0 71.9

Current assets 42.7 35.4 35.6

o/w: cash, cash equivalents and securities

37.5 28.0 32.0

Prepaid expenses 0.2 0.1 0.1

Total assets 104.4 106.5 107.7

Shareholders’ equity 97.8 100.7 102.3

Short-term debt 5.5 4.6 4.3

Long-term debt 0.0 0.0 0.0

Unearned revenues 0.7 0.7 0.7

Provisions 0.4 0.5 0.4

Total equity and liabilities 104.4 106.5 107.7

0.70

2.14

1.12 1.181.46

1.7%

8.2%

6.1%

4.4%3.9%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

2010 2011 2012 2013 2014

Dividends and dividend yield*

Dividend/share [RON] Dividend yield [%]

Share Statistics

31-Mar-14 31-May-14 31-Jul-14 30-Sep-14 30-Nov-14 31-Jan-15 31-Mar-15

BVB share performance [12 months]

www.bvb.ro 30

Trading BVB shares

Share Statistics

Analyst coverage

Analyst 12M TP

(Recommendation)Last report

(Company)

Mihaela Podgorski

(Swiss Capital)45.65 (Buy) 16-Mar-15

Lucian Albulescu

(Wood&Co)45.26 (Buy) 3-Mar-15

Catalin Diaconu

(Raiffeisen Bank)43.4 (Hold) 4-Feb-15

Raluca Negoescu

(Alpha Bank)Under review 11-Feb-15

Vlad Pintilie

(NBG Securities)30.6 (Neutral) 13-Feb-14

Included in several indices:

International

• FTSE Mondo Visione Exchanges Index (since Nov 9, 2010)

• Dow Jones Global Exchanges Index (Jun 17, 2011)

Local

• BET index

• ROTX index

• BET-XT index

• BET-BK index

• BET Plus index

• BET-TR index

• BET-XT-TR index

Symbol BVB

ISIN ROBVBAACNOR0

Reuters ROBVB.BX

Bloomberg BVB.RO

Bloomberg BBGID BBG000BBWMN3

Share price (31 Mar 2015) EUR 8.3/RON 36.58

Market Cap (31 Mar 2015) EUR 64 mn/RON 281 mn

No. of outstanding shares 7,674,198

ADT 12TM (ended 31 Mar 2015) RON 0.35 mn

P/E (31 Mar 2015, 12TM EPS) 23.1x

P/BV (31 Mar 2015, 12TM BV) 2.7x

Turnover velocity (2014)* 15%

Liquidity (2014)** 17%

33.97

26.80

28.77

2013 dividend: RON 1.18/share

Ex-div date: 13 May

31.030.92

40.39

32.5

31.0

33.99

* value traded ÷ average market cap ** no. of shares traded ÷ no. of shares outstanding

38.85

Financial Calendar

2/10/2015 – 2014 Preliminary results & Earnings Conference Call

4/27/2015 - 4/28/2015 – GSM

4/28/2015 – Meeting with analysts and investors

5/5/2015 – 1Q.2015 Results & Earnings Conference Call



IR Contact

Daniela Serban, Manager

Anca Olteanu, Financial Controller

Email: [email protected]

Phone: +40.21.307.95.00

Fax: +40.21.307.95.19

THIS PRESENTATION WAS PREPARED BY BURSA DE VALORI BUCURESTI. THE INFORMATION CONTAINED IN THIS DOCUMENT HAS NOT BEEN INDEPENDENTLY VERIFIED AND NO REPRESENTATION OR WARRANTY EXPRESSED OR IMPLIED

IS MADE AS TO, AND NO RELIANCE SHOULD BE PLACED ON THE FAIRNESS, ACCURACY, COMPLETENESS OR CORRECTNESS OF THIS INFORMATION. PAST PERFORMANCE IS NO GUARANTEE OF FUTURES RESULTS. THIS DOCUMENT DOES

NOT CONSTITUTE AN OFFER OR INVITATION TO PURCHASE ANY SHARES. CERTAIN STATEMENTS CONTAINED IN THIS DOCUMENT MAY BE STATEMENTS OF FUTURE EXPECTATIONS AND OTHER FORWARD-LOOKING STATEMENTS THAT ARE

BASED ON MANAGEMENT’S CURRENT VIEWS AND ASSUMPTIONS AND INVOLVE KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS, PERFORMANCE OR EVENTS TO DIFFER MATERIALLY FROM

THOSE EXPRESSED OR IMPLIED IN SUCH STATEMENTS. EXCHANGE RATE USED FOR ADT IS THE DAILY EXHANGE RATE AS ANNOUNCED BY THE NBR.

ACEASTA PREZENTARE A FOST REALIZATA DE BURSA DE VALORI BUCURESTI. INFORMATIILE CONTINUTE IN ACEASTA PREZENTARE NU AU FOST VERIFICATE DE CATRE O TERTA PARTE INDEPENDENTA, ASTFEL NU EXISTA NICIO

GARANTIE SI NU TREBUIE LUATA CA ATARE ACURATETEA, CORECTITUDINEA SI COMPLETITUDINEA ACESTOR INFORMATII. PERFORMANÞA ANTERIOARA NU ESTE O GARANTIE A REZULTATELOR VIITOARE. ACEST DOCUMENT NU

REPREZINTA O OFERTA DE A CUMPARA ACTIUNI. ANUMITE DECLARATII DIN ACEST DOCUMENT POT FI DECLARATII DESPRE ASTEPTARILE VIITOARE SAU ALTE EVOLUTII VIITOARE SI SE BAZEAZA PE VIZIUNEA SI IPOTEZELE ACTUALE ALE

CONDUCERII COMPANIEI SI IMPLICA RISCURI CUNOSCUTE SI NECUNOSCUTE, PRECUM SI INCERTITUDINI CARE POT DETERMINA CA REZULTATELE EFECTIVE, PERFORMANÞA SAU EVENIMENTELE VIITOARE SA DIFERE SEMNIFICATIV DE

CELE EXPRIMATE SAU INTELESE IN ACESTE DECLARATII.

BURSA DE VALORI BUCURESTI SA • Bulevardul Carol I nr. 34-36, Etaj 13-14, Sector 2, 020922, Bucuresti, Romania • Tel.: +40 21 307 95 00 • Fax: +40 21 307 95 19

Website: www.bvb.ro • E-mail: [email protected] • Registrul Comertului: J40/12328/2005 • CUI: 17777754 • Capital social, integral subscris si varsat: 76.741.980 lei

Decizia CNVM Nr. 369 / 31.01.2006

THIS PRESENTATION WAS PREPARED BY BURSA DE VALORI BUCURESTI. THE INFORMATION CONTAINED IN THIS DOCUMENT HAS NOT BEEN INDEPENDENTLY VERIFIED AND NO REPRESENTATION OR WARRANTY EXPRESSED OR IMPLIED

IS MADE AS TO, AND NO RELIANCE SHOULD BE PLACED ON THE FAIRNESS, ACCURACY, COMPLETENESS OR CORRECTNESS OF THIS INFORMATION. PAST PERFORMANCE IS NO GUARANTEE OF FUTURES RESULTS. THIS DOCUMENT DOES

NOT CONSTITUTE AN OFFER OR INVITATION TO PURCHASE ANY SHARES. CERTAIN STATEMENTS CONTAINED IN THIS DOCUMENT MAY BE STATEMENTS OF FUTURE EXPECTATIONS AND OTHER FORWARD-LOOKING STATEMENTS THAT ARE

BASED ON MANAGEMENT’S CURRENT VIEWS AND ASSUMPTIONS AND INVOLVE KNOWN AND UNKNOWN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS, PERFORMANCE OR EVENTS TO DIFFER MATERIALLY FROM

THOSE EXPRESSED OR IMPLIED IN SUCH STATEMENTS. EXCHANGE RATE USED FOR ADT IS THE DAILY EXHANGE RATE AS ANNOUNCED BY THE NBR.

ACEASTA PREZENTARE A FOST REALIZATA DE BURSA DE VALORI BUCURESTI. INFORMATIILE CONTINUTE IN ACEASTA PREZENTARE NU AU FOST VERIFICATE DE CATRE O TERTA PARTE INDEPENDENTA, ASTFEL NU EXISTA NICIO

GARANTIE SI NU TREBUIE LUATA CA ATARE ACURATETEA, CORECTITUDINEA SI COMPLETITUDINEA ACESTOR INFORMATII. PERFORMANÞA ANTERIOARA NU ESTE O GARANTIE A REZULTATELOR VIITOARE. ACEST DOCUMENT NU

REPREZINTA O OFERTA DE A CUMPARA ACTIUNI. ANUMITE DECLARATII DIN ACEST DOCUMENT POT FI DECLARATII DESPRE ASTEPTARILE VIITOARE SAU ALTE EVOLUTII VIITOARE SI SE BAZEAZA PE VIZIUNEA SI IPOTEZELE ACTUALE ALE

CONDUCERII COMPANIEI SI IMPLICA RISCURI CUNOSCUTE SI NECUNOSCUTE, PRECUM SI INCERTITUDINI CARE POT DETERMINA CA REZULTATELE EFECTIVE, PERFORMANÞA SAU EVENIMENTELE VIITOARE SA DIFERE SEMNIFICATIV DE

CELE EXPRIMATE SAU INTELESE IN ACESTE DECLARATII.

Thank you

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