The ASX could spend up to $140m in capital expenditure next year and cut its dividend to address “near term, situational” issues.
The ASX faces a capital expenditure bill nearly 50 per cent higher at as much as $140 million next financial year, forcing it to contemplate lowering dividends to pay for the mammoth upgrade of its ageing clearing and settlement infrastructure.
ASX said expenses, excluding significant items, would rise 12 per cent in the year ending June 30, and as much as 15 per cent in financial year 2024 because of a “reset” of its strategy and high regulatory and modernisation costs. Perhaps the most significant item for investors are changes to the group’s capital management policy: while the 2023 dividend will be kept at 90 per cent of underlying net profit, the payout ratio could be cut to between 80 per cent and 90 per cent from 2024 onwards.Ms Lofthouse said the company’s balance sheet was still strong. “ASX has an attractive core business, and we must continue to invest in order to grow and to support the financial markets effectively,” she said.
The investor day follows Monday’s statement that the ASX would keep the CHESS clearing and settlement infrastructure on life support until 2032, when the system will be 40 years old.to replace CHESS, which was meant to be implemented in 2020, and pulled the plug last year.
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