Press Release

NSX Ltd believes its merger of the Newcastle and Bendigo stock exchanges, and the creation of a new derivatives exchange, will provide the company with long-term benefits. The regional stock exchange company on Tuesday reported a net loss of $400,904 for the first half of 2005/06, due mainly to one-off restructuring costs associated with the merger. The results are the first that are consolidated between the Stock Exchange of Newcastle Ltd (SENL) and Bendigo Stock Exchange Ltd (BSX). The merger, which took place in April last year, was the main cause for NSX's operating expenses of $1.27 million in the six months to December 31, 2005, up from $311,880 in the prior first half. "This increase was due to the NSX acquisition of BSX and the associated costs of business rationalisation including: closure of Bendigo office, staff retraining, systems relocation and redundancy payments," chief executive Michael Cox said in a statement. However believed the merger would deliver long-term benefits by diversifying its revenue and risk, and by enhancing its ability to respond to demand for innovative and flexible market structures. Last month NSX announced it had entered into a joint venture with COM-AGEX Asia Pty Ltd to establish an international derivatives exchange. The joint venture will establish an Asian commodities and agriculture electronic derivatives exchange. "It is expected that the new Derivatives Exchange will create and trade a range of specially designed benchmark instruments and financial products on an integrated futures and options trading platform," Mr Cox said. "The growth strategy is driven by the view of the renewed significance of commodities as a formal `true' alternative asset class." NSX's revenue for the half was at $869,972, up from $289,000 due to the inclusion of BSX. There were 87 listed securities at December 2005, with 16 million shares changing hands in 421 trades during the half.