ASX Shares Slide on Expense, Capital Management Guidance

By Alice Uribe

SYDNEY-- ASX shares slid Tuesday, after the company said it will make changes to its capital management policy and flagged higher expenses--partly relating to its CHESS trading system.

The stock was down 10% at 60.77 Australian dollars ($US40.21) after hitting a low of A$60.50 earlier. The securities exchange is currently the worst performer on Australia's S&P/ASX 200.

ASX said Tuesday that its FY 2023 dividend payout ratio policy was being maintained at 90% of underlying net profit after tax, but from FY 2024, its dividend payout ratio policy could be revised to a range of between 80%-90%.

As part of a new five-year strategy, ASX also guided for total expense growth, excluding significant items, of 12% for FY 2023, and between 12% and 15% for FY 2024. The company attributed some of the expense growth to CHESS-related regulatory and replacement costs.

"With a strong balance sheet, leading positions in key markets and structural tailwinds, ASX has an attractive core business, and we must continue to invest in order to grow and to support the financial markets effectively," said ASX CEO Helen Lofthouse.

"We recognize there are near term, situational challenges that we must address, including our regulatory commitments and our expanded technology modernisation program."

ASX shares are down 11% so far in 2023.

Write to Alice Uribe at alice.uribe@wsj.com

(END) Dow Jones Newswires

June 05, 2023 21:35 ET (01:35 GMT)

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