Tel Aviv Stock Exchange Ltd. — Earnings Release 2020

May 26, 2020

THE TEL-AVIV STOCK EXCHANGE LTD REPORTED FIRST QUARTER 2020 RESULTS

May 26, 2020 (Tel Aviv) -Tel Aviv Stock Exchange Ltd (TASE:TASE) today announced its financial results for the first quarter ended March 31, 2020.¹

1. General

1.1 TASE's Results, Business and Corporate Highlights for the First Quarter of 2020

Results:

• TASE revenues amounted to NIS 81.2 million in the first quarter of 2020, an increase of 26% compared to the corresponding quarter last year, mainly because of higher trading volumes on following the coronavirus outbreak.
• Adjusted EBITDA increase in the first quarter of 2020 to NIS 28.9 million compared to NIS 14.2 million in the corresponding quarter last year, an increase of 104%.
• Financing expenses increase in the first quarter of 2020 to NIS 4.4 million compared to financing income of NIS 4.0 million in the corresponding quarter last year. The transition to financing expenses this quarter resulted from a negative return of approximately 2.1% due to the impact of the coronavirus outbreak on government bonds.
• Adjusted net profit amounted to NIS 10.6 million in the first quarter of 2020, compared to NIS 5.4 million adjusted net profit in the corresponding quarter last year, an increase of 96%.

¹ The Board of Directors of TASE today approved the Condensed Consolidated Financial Statement as of March 31, 2020. The consolidated financial statements of the Company were prepared in accordance with IFRS GAAP. This is an English translation of parts of the information included in the approved financial statements. In the event of any discrepancy between the original Hebrew and the translation to English, the Hebrew version alone will prevail. The consolidated financial statements in the English Version will be published on the website by the end of June.

BUSINESS HIGHLIGHTS

• The daily average trading volume of equity amounted to approximately NIS 2.2 billion, compared with NIS 1.1 billion in the first quarter last year, an increase of 91%.
• The daily average trading volume of bonds amounted to approximately NIS 5.0 billion, compared with NIS 3.5 billion in the first quarter last year, an increase of 42%.
• The daily average trading volume of derivatives amounted to 183 thousand units a day, compared with 135 thousand units in the first quarter of 2019, an increase of 36%.

CORPORATE HIGHLIGHTS

• To ensure the continuous operation of TASE systems, including the trading and clearing systems, TASE created a safe work environment for its employees, alongside the implementation of remote work procedures.
• The trading and clearing systems of TASE operated optimally, thereby facilitating reliable and stable trading, at record turnovers boosted by the coronavirus outbreak.
• New rules of membership have been approved for Stock Exchange members acting solely on their own account (nostro).
• The Company is preparing to launch the sale, via API, of data products for individuals, companies, and data vendors.

1.2 MATERIAL EVENTS THAT OCCURRED IN THE REPORTING PERIOD AND THEREAFTER

• The outbreak of the new coronavirus (COVID-19) and its spreading into a "global pandemic" resulted in uncertainty and strong fluctuations in the capital markets, which were exacerbated by its effects on global economic activities (for more information see section 4.1 below).
• On April 16, 2020, a dividend of NIS 8,770 thousand (representing NIS 0.0877 per ordinary share) was paid to the Company's shareholders of record as of April 1, 2020.

2. Presented below is information relating to the results for the first quarter of 2020 (in thousands)

Three Months Ended March 31, 2020 Compared with Three Months Ended March 31, 2019

Statement of Profit or Loss

	Quarter ended		Difference
	31.03.2020	31.03.2019	Amount	%
Revenue from services	81,207	64,627	16,580	26%
Expenses	63,620	61,736	1,884	3%
Profit before financing income, net	17,587	2,891	14,696	508%
Financing income (expenses)	)4,407)	4,020	)8,427)	)210%)
Taxes on income	2,950	1,494	1,456	97%
Net profit	10,230	5,417	4,813	89%
%	13%	8%

Adjusted net profit and adjusted EBITDA data²

		Quarter ended	Difference
Adjusted EBITDA for the quarter:	31.03.2020	31.03.2019	Amount	%
Profit before financing income, net	17,587	2,891
Share-based payment expenses	414	-
Depreciation, amortization and capital losses	10,889	11,300
Adjusted EBITDA for the quarter	28,890	14,191	14,699	104%
%	36%	22%
Adjusted net profit for the quarter:
net profit	10,230	5,417
Share-based payment expenses	414	-
Adjusted net profit	10,644	5,417	5,227	96%
%	13%	8%

² Adjusted data for the profit and EBITDA (operating profit before interest, tax, depreciation and amortization): These data are based on the data in the Company's financial statements for the reported periods, after eliminating the effects of certain events and factors, as explained above, that are not typical of the Company's operating activities.

It is hereby clarified that the data presented above are not presented in accordance with generally accepted accounting principles and do not reflect the Company's cash flows from operating activities or its operating profits and net profit and, accordingly do not constitutes a substitute to the data in the Company's financial statements regarding the operating profit and/or the net profit. Nevertheless, in the Company's opinion, these data enable a better comparison to be made of the Company's performance in the reported periods.

The revenue in the first quarter of 2020 – below is the composition of the quarter's revenue,

compared to the corresponding quarter last year:

	Quarter ended				Difference
	31.03.2020	% of the Company's total revenues	31.03.2019	% of the Company's total revenues
Revenue from services:
	39,680	49%	26,553	41%	49%
Trading and clearing commissions	The increase primarily reflects the higher trading volumes on TASE following the coronavirus outbreak. The higher shares trading volumes accounted for close to 24% of the increase in total revenue from trading and clearing services, while the increased trading volumes in mutual funds contributed close to 8%. The higher trading volumes in derivatives, corporate bonds and government bonds accounted, each, for a 6% increase in total revenue from trading and clearing. It should be noted that the rate of effective commissions, other than in relation to derivatives, decreased as a result of the increase in the volume of the transactions that are affected by the application of a maximum commission.
Listing fees and levies	14,977	18%	13,483	21%	11%
	The increase is due mainly to the increase in revenue recognition in respect of listing fees received in previous years (an increase of 5% in revenue from listing fees and levies). Another increase resulted from the charging of new annual fees introduced in 2019 and 2020 (an increase of 4% in revenue from listing fees and levies) and in revenue from existing fees, which derived, among others, from the increase in the market cap of companies used to calculate the annual fee (an increase of 2% in revenue from listing fees and levies).
Clearing House services	14,368	18%	12,351	19%	16%
	Most of the increase is due to an increase in Clearing House services to members following the coronavirus outbreak (an increase of close to 12% in total revenue from Clearing House services), to revenue from new Clearing House services (an increase of close to 2% in total revenue from Clearing House services), and to an increase in custodial fees resulting from the appreciation in the average value of the Clearing House managed assets between the quarters (an increase of close to 2% in total revenue from Clearing House services).
Distribution of data and	11,615	14%	11,639	18%	)0%)
connectivity services	revenue and connectivity services).			The data distribution activity reflects the implementation of the information usage model initiated in early 2019. Revenue from this activity has reduced following efficiency measures taken by the data distributors, which was partly offset by an increase in revenue from private customers (a 4% reduction in distribution of data and connectivity services). In opposition, revenue from connectivity services has been on the rise following the launch of the colocation and BSO activities in 2019 (a 4% increase in revenue from distribution of data	from
Other revenue	996	1%	1,081	2%	)8%)
		discontinued following the coronavirus outbreak in March 2020.		Other revenue includes the renting of the Visitor Center, which has been
	81,207	100%	64,627	100%	26%

• The costs in the first quarter of 2020 totaled approximately NIS 63.6 million, compared to costs of approximately NIS 61.7 million in the corresponding quarter last year, an increase of close to 3% between the quarters. The increase in costs was due mainly to the increase in employee benefit expenses (4.6% of total costs) as a result of salary updates, a decrease in capitalized software development costs and the impact of the coronavirus outbreak, which were partly offset by a reduction in marketing expenses (3.7% of total costs) as a result of the timing of marketing campaign launches in the quarters.
• Financing expenses in the first quarter of 2020 totaled approximately NIS 4.4 million, as compared to financing income of approximately NIS 4 million in the corresponding quarter last year. The transition to financing expenses this quarter resulted from a negative return of approximately 2.1% due to the impact of the coronavirus outbreak on trading on TASE and from a reduction in the value of the Company's investments in marketable securities' portfolios comprising Israeli Government bonds, as compared to a positive return of approximately 2.2% in the corresponding quarter last year. It should be noted that this effect was abated by a moderate recovery in the prices of the government bonds after the reporting date, in the period from April 2020 until shortly before the approval date of the financial statements.
• The net profit in the first quarter of 2020 totaled approximately NIS 10.2 million, compared to approximately NIS 5.4 million in the corresponding quarter last year, an increase of close to 89% between the quarters. The increase in profit was due to higher revenues, primarily from trading and clearing services, and was partly offset by the transition to financing expenses, as described above.
• The adjusted EBITDA in the first quarter of 2020 totaled approximately NIS 28.9 million, compared to approximately NIS 14.2 million in the corresponding quarter last year, an increase of close to 104% between the quarters. The increase is due to higher revenue from services, and was partly offset by an increase in employee benefit costs.
• The adjusted net profit in the first quarter of 2020 totaled approximately NIS 10.6 million, compared to approximately NIS 5.4 million in the corresponding quarter last year, an increase of close to 96% between the quarters. The increase is due mainly to higher revenue from services, and was partly offset by an increase in costs, primarily in relation to employee benefits and financing expenses and taxes.

Presented below is information relating to the financial position as of March 31, 2020 (NIS, in thousands):

	As of		Difference
	31.03.2020	31.03.2019	Amount	%
Cash and cash equivalents and short-term
financial assets	338,792	308,892	29,900	10%
Other current assets	27,532	20,362	7,170	35%
Property and equipment and intangible assets	452,141	457,543	(5,402)	(1%)
Other non-current assets	16,567	18,363	(1,796)	(10%)
Total assets (*)	835,032	805,160	29,872	4%
Current liabilities	113,589	81,876	31,713	39%
Non-current liabilities	112,972	124,577	(11,605)	(9%)
Total liabilities (*)	226,561	206,453	20,108	10%
Total equity	608,471	598,707	9,764	2%
Ratio of equity to total assets	73%	74%
Surplus equity over regulatory requirements
in NIS millions	289	282	7	2%
Surplus liquidity over regulatory requirements
in NIS millions	129	132	(3)	(2%)

• (*) The total assets and liabilities as of March 31, 2020 and December 31, 2019, include a balance of assets/liabilities in respect of open derivative positions amounting to NIS 576.8 million and NIS 351.3 million, respectively, which for reasons of convenience in analyzing the financial position have been offset against each other in this report.
• The total assets as of March 31, 2020 amounted to NIS 835 million, a 4% increase compared to December 31, 2019. Most of the increase is due to an increase in cash from operating activities.
• The total liabilities as of March 31, 2020 amounted to NIS 226.6 million, a 10% increase compared to December 31, 2019. Most of the increase is due to annual fees collected in advance and to a dividend declared that was paid only after balance sheet date, which were partly offset by a decrease in the actuarial liability for long-term employee benefits due to an increase in the discount rate.

Presented below is Cash flows for the three months ended March 31, 2020 (NIS, in millions):

Item		Data for the three months ended March 31		Explanations of the Company for the inter-half-year change
		2020	2019
	Adjusted EBITDA	28.9	14.2	The increase in adjusted EBITDA is due mainly to an increase in revenue from services, primarily trading and clearing services, and was partly offset by moderate increase in expenses, due to the mostly fixed structure of expenses.
Net cash from operating	Changes in working capital	16.7	6.2	The increase in working capital is due to the timing of payments and receipts between the quarters, primarily with respect to employee benefits and other receivables.
activities	Financing and tax	1.0	4.3	The decrease stems mainly from tax payments in the quarter, as compared to tax receipts in the corresponding quarter and a reduction in interest received.
	Total	46.6	24.7	Cash flows from operating activities grew by close to 88% between the quarters.
Net cash from (for)	Investments in property and equipment and in intangible assets and capitalized payroll costs	(8.1)	(10.3)	The decrease is due to the timing of implementation of the Group's investment work plans in the quarters.
investing activities	Proceeds from disposal of financial assets, net	1.5	0.1	The increase is due to net proceeds from disposals within investing activities in the managed portfolios.
	Total	(6.6)	(10.2)
Net cash from	Lease payments	(2.5)	(2.3)
financing activities	Total	(2.5)	(2.3)
Total increase in cash and cash equivalents		37.5	12.2	The cash flow grew by close to 207% between the quarters.

3. Events at the reporting date and thereafter

3.1 Outbreak of the coronavirus

Pursuant to the stated in note 26 to the Annual Financial Statements concerning the outbreak of the coronavirus, to the date of approval of the financial statements, the short-term significant negative effects of the coronavirus on the operating results of the Company cannot be estimated, as the Company is not directly affected by the prices of the securities, but rather by the trading and clearing turnovers of securities and derivatives. The Company has an operational and technological solution in place that facilitates the operation of TASE and the Clearing Houses with a significantly lower number of employees that are required to be present at the sites of the Company for the operation of the core trading and clearing systems. It should be noted that the restrictions imposed in Israel in recent weeks by virtue of the Emergency Regulations do not categorically prohibit the opening of workplaces, but rather stipulate various limitations that are primarily designed to reduce the number of employees in the workplaces and to encourage remote work, in both the public and the private sectors. At any rate, even the broadest application of the Regulations exempts a number of employers, including those operating in the capital market, such as the Company (alongside banks, Stock Exchange members, fund managers, rating firms and more).

The drop in the prices of government bonds that are traded on TASE in the first quarter of 2020 resulted in a loss of approximately NIS 4.4 million in the securities portfolios of the Company, which was recorded under financing expenses in the Company's statement of profit or loss. It should be noted that this effect was significantly abated by a moderate recovery in the prices of the government bonds after the reporting date, in the period from April 2020 until shortly before the approval date of the financial statements.

Moreover, the perseverance and exacerbation of this unprecedented global crisis could also adversely affect business and economic operations in Israel and worldwide, including the volumes of the investment and trading in securities, in a manner and to an extent that, at this stage, cannot be estimated and quantified by the Company. Nevertheless, it is not unreasonable to assume that the current uncertainty will lead to reduced volumes of activity in the primary market (both equity and debt) that will in turn entail a decline in revenues from examination and listing fees with respect to new securities. Furthermore, it is likely that an ongoing erosion in the prices of listed securities could impact the revenues of the Group from custodial services, to some extent, as these are derived from the value of the securities held, and if price levels are not corrected by the end of the year, this could adversely impact the volume of fees from companies in 2021, which are derived from the value of the securities listed as of December 2020. Additionally, persisting uncertainty, in general, and in the capital market, in particular, could defer the Company's launching of new products or services until the smoke clears. Finally, it should be noted that in the aftermath of the crisis recovery will be gradual. At this stage and in the absence of clear criteria for the implementation and continuity of the "exit strategy" that has been declared by the Israeli Government, the volumes of trading and capital-raising in the recovery period cannot be estimated, more so as these depend, among others, on the volatility of the markets and the pace at which the public returns to invest, directly or indirectly, in securities that are listed on TASE.

Since, to the date of approval of the financial statements, the potential effects of the coronavirus crisis on the main income channels of the Company (trading and clearing commissions, custodial services etc.) stem primarily from the macro implications of the crisis on the local and the global economy, the Company is unable to quantify the extent of possible reduction in its income (and, as stated above, to the date of approval of the financial statements, such effects are not evident, with the exception of the more marginal

revenue channels, such as rental of space and holding of events, which at any rate are not material to the Company).

3.2 Claim Against the Ministry of Finance Concerning Listing Fees

On May 5, 2020, the Company filed a monetary claim by summary procedure with the Tel Aviv District Court against the State of Israel, the Ministry of Finance - Accountant General, in an amount of approximately NIS 20.13 million (including VAT). The cause of the claim is default in payment of the listing fees payable by virtue of the Stock Exchange bylaws in respect of government bonds that had been issued in the period from May 2013 to the end of March 2020 (inclusive) as part of the activities of the of the Ministry of Finance's lending pool. To remove any doubts, it is hereby clarified that, to date, the Company has not recognized in its financial statements income from the listing fees covered in the claim.

3.3 After the reporting period, during the second quarter, the Company launched media campaigns (on the Web, social networks, in printed press and in commercial broadcasting channels). The campaigns budgets are estimated at NIS 2.5-3 million.

4. Information relating to the results for the first quarter of 2020 (in thousands)

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (NIS, in thousands)

	March 31,		December 31,
	2020	2019	2019
Assets
Current assets
Cash and cash equivalents	141,491	66,358	103,928
Financial assets at fair value through profit or loss	197,301	184,996	204,964
Trade receivables	12,287	18,123	13,776
Other receivables	15,245	14,383	6,373
Current tax assets	-	1,949	213
	366,324	285,809	329,254
Assets derived from clearing operations in respect to open derivative positions	576,842	932,174	351,742
Total current assets	943,166	1,217,983	680,996
Non-current assets
Cash restricted as to use	541	540	541
Other long-term receivables	3,345	935	3,761
Property and equipment, net	339,482	(*) 353,015	345,176
Intangible assets, net	112,659	107,640	112,367
Deferred tax assets	12,681	11,965	14,061
Total non-current assets	468,708	474,095	475,906
Total assets	1,411,874	1,692,078	1,156,902

(*) Reclassification

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (NIS, in thousands)

	March 31,	December 31,
	2020	2019	2019
Liabilities and Equity
Current liabilities
Trade payables	9,252	11,810	15,376
Short-term liabilities for employee benefits	37,251	29,840	33,121
Other payables	4,908	3,114	3,301
Dividend declared	8,770	-	-
Current maturities of lease liabilities	8,897	9,441	9,728
Current tax liabilities	4,015	1,012	970
Deferred income from listing fees and levies	40,496	34,865	19,380
	113,589	90,082	81,876
Liabilities derived from clearing operations in respect to open derivative positions	576,842	932,174	351,742
Total current liabilities	690,431	1,022,256	433,618
Non-current liabilities
Non-current liabilities for employee benefits	27,740	22,700	37,565
Lease liabilities	11,494	13,357	12,553
Deferred income from listing fees and levies	73,197	69,995	73,918
Other liabilities	541	540	541
Total non-current liabilities	112,972	106,592	124,577
Equity
Remeasurement reserve of net liabilities in respect to defined benefit	(9,015)	(6,411)	(16,905)
Capital reserve in respect to share-based payment transactions	31,652	27,380	31,238
Other capital reserves	43,079	13,107	43,079
Retained earnings	542,755	529,154	541,295
Total equity	608,471	563,230	598,707
Total liabilities and equity	1,411,874	1,692,078	1,156,902

CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

(NIS, in thousands)

	Quarter ended		Year ended
	March 31,		December 31,
	2020	2019	2019
Revenue from services:
Trading and clearing commissions	39,680	26,553	107,000
Listing fees and levies	14,977	(*) 13,483	54,678
Clearing House services	14,368	12,351	52,331
Distribution of data and connectivity services	11,615	(*) 11,639	42,419
Other revenue	567	(*) 601	3,573
Total revenue from services	81,207	64,627	260,001
Cost of revenue:
Employee benefits expenses	36,391	33,536	132,973
Expenses in respect to share-based payments	414	-	3,858
Computer and communications expenses	6,288	5,736	23,819
Property taxes and building maintenance expenses	3,134	3,023	12,602
General and administrative expenses	2,375	1,747	9,122
Marketing expenses	1,430	3,736	7,858
Fee to the Israel Securities Authority	2,699	2,658	10,680
Depreciation and amortization	10,871	10,606	43,571
Other expenses	18	694	1,358
Total costs	63,620	61,736	245,841
Profit before financing income, net	17,587	2,891	14,160
Financing income	(4,243)	4,266	9,975
Financing expenses	164	246	1,006
Total financing income (expenses), net	(4,407)	4,020	8,969
Profit before taxes on income	13,180	6,911	23,129
Taxes on income	2,950	1,494	5,571
Profit for the period	10,230	5,417	17,558
Basic earnings per share (NIS)	0.102	0.054	0.176
Diluted earnings per share (NIS)	0.100	0.054	0.174

(*) Reclassification

ONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (NIS in thousands)

	Quarter ended March 31, 2020
		Remeasure
	Capital	-ment
	reserve in	reserve of
	respect to	net liability
	share-based	in respect	Other
	payment	to defined	capital	Retained
	transactions	benefit	reserves	earnings	Total
Balance at January 1, 2020	31,238	(16,905)	43,079	541,295	598,707
Profit for the period	-	-	-	10,230	10,230
Other comprehensive income for the period	-	7,890	-	-	7,890
Total comprehensive income (loss) for the
period	-	7,890	-	10,230	18,120
Dividend declared	-	-	-	(8,770)	(8,770)
Share-based payment	414	-	-	-	414
Balance at March 31, 2020	31,652	(9,015)	43,079	542,755	608,471

CONSOLIDATED STATEMENTS OF CASH FLOWS (NIS, in thousands)

	Quarter ended March 31,		Year ended December 31,
	2020	2019	2019
CASH FLOWS FROM OPERATING ACTIVITIES
Profit for the period	10,230	5,417	17,558
Expenses in respect of share-based payments	414		- 3,858
Tax expenses recognized in profit or loss	2,950	1,494	5,571
Net financing expenses (income) recognized in profit or loss	4,407	(4,020)	(8,969)
Depreciation and amortization	10,871	10,606	43,571
Loss (gain) from disposal of property and equipment and intangible assets	18	694	1,358
	28,890	14,191	62,947
Changes in asset and liability items:
Decrease (increase) in trade receivables and other receivables	(6,871)	(11,940)	(607)
Decrease (increase) in receivables in respect to open derivative positions	(225,100)	(36,773)	543,659
Decrease in trade payables and other payables	(1,375)	(713)	1,176
Increase (decrease) in deferred income from listing fees and levies	20,395	17,246	5,726
Decrease in payables in respect to open derivative positions	225,100	36,773	(543,659)
Increase (decrease) in liabilities for employee benefits	4,552	1,566	6,083
	45,591	20,350	75,325
Interest received	1,859	2,976	6,110
Interest paid	(115)	(159)	(637)
Tax receipts (payments) - operating activities	(713)	1,474	332
	1,031	4,291	5,805
Net cash provided by operating activities	46,622	24,641	81,130

CONSOLIDATED STATEMENTS OF CASH FLOWS (NIS, in thousands, cont'd)

	Quarter ended March 31,		Year ended December 31,
	2020	2019	2019
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment	(3,067)	(2,392)	(6,416)
Proceeds from the disposal of property and equipment	-		- 192
Acquisitions of intangible assets	(1,436)	(3,196)	(11,850)
Payments in respect to costs capitalized to property and equipment and to
intangible assets	(3,610)	(4,698)	(15,838)
Proceeds from disposal (acquisition) of financial assets at fair value through
profit or loss, net	1,464	130	(17,032)
Net cash used in investing activities	(6,649)	(10,156)	(50,944)
CASH FLOW FROM FINANCING ACTIVITIES:
Lease payments	(2,502)	(2,349)	(9,739)
Company's share in the first-time listing of the shares	-		- 15,600
Receipts from shareholders within the framework of implementing the
ownership restructuring, net	-		- 13,782
Net cash provided by (used in) financing activities	(2,502)	(2,349)	19,643
Net increase (decrease) in cash and cash equivalents	37,471	12,136	49,829
Cash and cash equivalents, beginning of the period	103,928	54,363	54,363
Effect of changes in exchange rates on cash balances held in foreign	92	(141)	(264)
currency
Cash and cash equivalents, end of the period	141,491	66,358	103,928

APPENDIX A – NON-CASH ACTIVITIES:

Acquisition of property and equipment and intangible assets, under short-term	1,178	2,501	4,320
credit
Increase in right-of-use assets and lease liabilities	516	300	5,372
Increase in receivables for lease and lease liabilities	96	710	2,256
Dividend declared	8,770	-	-

Quarterly statements of profit or loss for 2019 and for the first quarter of 2020 (NIS, in thousands)

Item	Jan Mar 2019	Apr Jun 2019	Jul Sep 2019	Oct Dec 2019	Jan Mar 2020	2019
Number of trading days	63	60	62	59	63	244
Trading and clearing commissions	26,553	25,915	28,193	26,339	39,680	107,000
Listing fees and levies*	13,483	13,478	13,508	14,209	14,977	54,678
Clearing House services	12,351	12,878	12,918	14,184	14,368	52,331
Distribution of data and connectivity services	11,639	9,670	10,422	10,688	11,615	42,419
Other revenue	601	969	1,007	996	567	3,573
Total revenue from services	64,627	62,910	66,048	66,416	81,207	260,001
Expenses in respect of employee benefits, net	33,536	32,051	33,088	34,298	36,391	132,973
Share-based payment expenses	-	3,008	432	418	414	3,858
Computer and communication expenses	5,736	5,615	6,320	6,148	6,288	23,819
Property taxes and building maintenance expenses	3,023	3,076	3,075	3,428	3,134	12,602
General and administrative expenses	1,747	2,431	2,153	2,791	2,375	9,122
Marketing expenses	3,736	434	1,746	1,942	1,430	7,858
Fee to the Israel Securities Authority	2,658	2,658	2,658	2,706	2,699	10,680
Depreciation and amortization expenses	10,606	11,099	10,809	11,057	10,871	43,571
Other expenses	694	579	6	79	18	1,358
Total cost of revenue	61,736	60,951	60,287	62,867	63,620	245,841

Item	Jan Mar 2019	Apr Jun 2019	Jul Sep 2019	Oct Dec 2019	Jan Mar 2020	2019
Profit before financing income (expenses), net	2,891	1,959	5,761	3,549	17,587	14,160
Financing income	4,266	2,472	3,286	)49)	)4,243)	9,975
Financing expenses	246	186	221	353	164	1,006
Total financing income (expenses), net	4,020	2,286	3,065	)402)	)4,407)	8,969
Profit before taxes on income	6,911	4,245	8,826	3,147	13,180	23,129
Taxes on income	1,494	1,739	2,021	317	2,950	5,571
Net profit	5,417	2,506	6,805	2,830	10,230	17,558

ABOUT TASE

The Company, including by means of the companies consolidated in its financial statements )collectively, "the Group"), is engaged in the area of securities trading and securities clearing .

Within this framework, the Group is engaged in setting rules regarding the TASE companies, rules for listing securities on TASE (including the obligations that apply to companies whose securities are listed) and rules regarding trading on TASE. The Group operates trading systems and provides clearing services for both listed and non-listed securities. In addition, the Group operates a derivatives clearing house that writes derivatives that are traded on TASE, clears them and serves as a central counterparty for transactions in them. The Group provides central counterparty (CCP) services for transactions in securities and derivatives that are executed on TASE and also provides central securities depository (CSD) services for securities. The Group engages in calculating security indices, in authorizing the use of indices for the creation of financial instruments that track the indices, and in distributing TASE trading data. In addition, since January 2018, the Group has operated a nominee company as defined in the Securities Law )securities traded on TASE are registered in the nominee company's name). The Company has one area of activity that is reported as a business segment in the Company's consolidated financial statements – trading and clearing transactions in securities

CONTACTS

Yehuda van der Walde		Orna Goren
EVP, CFO		Head of Communication and Public Relations Unit
Email:	cfo@tase.co.il	Email:	ir.tase@tase.co.il
Tel:	+972-76-8160442	Tel:	+972-76-8160405

Appendix – Transactional Metrics

	Quarter Ended		Year Ended
	March 31,		December 31,
	2020	2019	2019
Number of trading days	63	63	244
SHARES Shares (ex. ETN / ETFs)	649	745	820
ETN / ETFs on share indices	46.1	64	64.3
Market value (in NIS billions)	695	809	884
Shares (ex. ETN / ETFs)	1,663	932	1,081
ETN / ETFs on share indices	527	217	219
Average daily turnover (in NIS millions)	2,190	1,149	1,300
Average commissions	0.0100%	0.0105%	0.0102%
Revenue (in NIS thousands)	13,849	7,577	32,434
BONDS
Government bonds -Unlinked	313	290	316
Government bonds -Linked	210	208	216
Corporate bonds	373	373	411
Bonds (ex. ETN / ETFs)	896	892	943
ETN / ETFs on bond indices	26	21	29
Market value (in NIS billions)	922	913	972
Government bonds - Unlinked ADV (in NIS millions)	2,492	1,773	1,722
Government bonds - Linked ADV (in NIS millions)	1,307	872	897
Corporate bonds ADV excluding ETNs (in NIS millions)	1,043	793	798
ETN / ETFs on bond indices	182	106	95
Average daily turnover (in NIS millions)	5,023	3,543	3,512
Government bonds Unlinked - Average commissions	0.0019%	0.0020%	0.0019%
Government bonds Linked - Average commissions	0.0028%	0.0029%	0.0029%
Corporate bonds - Average commissions	0.0070%	0.0069%	0.0069%
Government bonds (in NIS thousands)	2,932	2,201	8,052
Government bonds (in NIS thousands)	2,314	1,603	6,367
Corporate bonds (in NIS thousands)	5,386	3,896	15,116
Other (MTS) (in NIS thousands)	42	61	187
Revenue (in NIS thousands)	10,675	7,761	29,722

	Quarter Ended March 31,	Year Ended December 31,
	2020	2019	2019
TREASURY BILLS
Market value (in NIS billions)	112	114	120
Treasury bills ADV (in NIS millions)	911	436	413
Average commissions	0.0019%	0.0027%	0.0026%
Revenue (in NIS thousands)	1,080	746	2,581
MUTUAL FUNDS
Market value (in NIS billions)	200	230	259
Average daily value of creation / redemptions (in NIS millions)	1686	913	883
Average commissions	0.0076%	0.0104%	0.0110%
Revenue (in NIS thousands)	8,106	6,007	23,716
DERIVATIVES
Options on indices	121	93	97
Derivatives on FX	59	40	45
Derivatives on single shares	3	2	3
Total derivative contracts (in '000 units)	182	135	145
Options on indices - Average commissions	0.580	0.580	0.580
Derivatives on FX -Average commissions	0.360	0.360	0.360
Derivatives on single shares- Average commissions	1.000	1.000	1.000
Revenue (in NIS thousands)	5,971	4,461	18,547
Total revenue from Trading and clearing commissions	39,680	26,552	107,000

	Quarter Ended March 31,		Year Ended December 31,
		2020 2019
LISTING FEES AND LEVIES			2019
Weighted avg. number of companies / funds
Companies	531	540	541
Mutual funds and ETNs / ETFs	2,150	2,087	2,132
Avg. revenue from levies (in NIS thousands)
Companies	5	5	19
Mutual funds	2	2	7
Revenue from annual levies from: (in NIS thousands)
Companies	2,766	2,596	10,198
Mutual funds & ETFs	4,354	3,850	15,339
Nominee Company	751	568	2,530
Issuance volume and swap transactions (in NIS millions)
Shares and Corporate bonds	19,835	16,550	91,415
Government bonds	18,552	22,047	86,115
Short term T-bills	27,962	23,927	131,684
Number of issuances
Tel Aviv public offerings	23	12	60
New offerings	2	1	7
New dual-listed companies	1	-	3
Issuance volume and funding
IPOs (in NIS millions)	437	53	3,206
New offerings (in NIS millions)	-	-	1,728
Corporate bonds Number of issuances (total)	33	30	160
Corporate bonds Number of issuances (new)	-	-	4
Average revenue from examination and listing fees
Shares and bonds	0.0201%	0.0214%	0.0229%
Government bonds	0.0036%	0.0035%	0.0035%
Revenue from examination and listing fees (in NIS thousands)
Examination fees	1,479	1,475	5,416
Listing of shares & bonds	3,986	3,545	20,958
Listing of government bonds	675	772	3,045
Listing of T-bills	196	167	922
Annual levies and handling fees from member	-	82	1,208
Other	98	112	746
Effect of IFRS on Listing Fees	673	316	(5,684)

	Quarter Ended March 31,	Year Ended December 31,
	2020	2019	2019
CLEARING HOUSE SERVICES
Market value of assets (in NIS billions)	2,265	2,419	2,639
Avg. commissions on custodian fees	0.00109%	0.00105%	0.00105%
Revenue from: (in NIS thousands)
Custodian fees	6,671	6,370	26,534
Clearing House services for members / company events	6,514	4,669	21,160
Other	1,183	1,312	4,636
Total revenue from Clearing House services	14,367	12,351	52,331

	Quarter Ended March 31,	Year Ended December 31,
	2020	2019	2019
DISTRIBUTION OF DATA AND CONNECTIVITY SERVICES:
Average number of data terminals
Domestic business clients	7,607	8,276	7,274
Domestic private clients	7,766	4,670	6,489
Overseas	4,293	5,013
Quote generator	272	171	245
Revenue from data terminals and data (in NIS thousands)
Domestic business clients	4,131	4,469	15,528
Domestic private clients	815	490	2,726
Overseas	1,346	1,642	6,270
Quote generator	400	411	1,430
Usage based	1,682	1,789	5,793
Indices and data	1,014	1,068	3,019
connectivity services	2,226	1,769	7,654
Total revenue from Distribution of data and connectivity services	11,615	11,638	42,419

Presented below are details regarding the speed of trading in Israel in the reported period:

Turnover Speed

	Quarter Ended March 31,		% change	Year Ended December 31,
	2020	2019		2019
Turnover Speed
Shares (1)	60.8%	32.5%	87.1%	35.2%
Corporate bonds (1)(2)	74.8%	57.4%	30.3%	54.9%
Government bonds Unlinked (3)	184.1%	142.6%	29.1%	128.4%
Government bonds Linked (4)	113.8%	79.4%	43.3%	79.8%
Treasury bills	140.1%	75.6%	85.3%	61.3%

(1) Turnover velocity includes the ETFs / ETFs traded.

)2) Turnover velocity doesn't include the corporate bond traded in institutional succession.

(3) Including shekel fixed- interest shekel bonds "Sahar" and short-term government bonds.

(4) Including index-linked bonds, and variable- interest shekel bonds - "Gilon".