HONG KONG’S stock exchange operator yesterday said 2018 profit surged 26 percent to a record high, meeting expectations, boosted by fees from a number of mega initial public offerings (IPOs) in the first part of the year as well as clearing fees and strong trading.

Net profit reached HK$9.31 billion (US$1.19 billion) from HK$7.4 billion a year prior, Hong Kong Exchanges and Clearing Ltd. (HKEX) said in a bourse filing.

That compared with the HK$9.36 billion average of 16 analyst estimates and beat the previous record of HK$7.96 billion set in 2015.

In the filing, CEO Charles Li and chairman Laura Cha said the outlook for 2019 was more challenging.

“We are entering 2019 with more geopolitical and economic uncertainty than has been the case for many years,” Cha said.

The result comes after HKEX revised its listing regime as it sought to increase its competitiveness over other financial centers following the loss of big Chinese names to New York.

Since April, HKEX has allowed IPOs by firms with dual-class share structures and biotech startups without revenue, and eased requirements for overseas-listed Chinese firms to have a secondary listing in Hong Kong.

So far just smartphone maker Xiaomi Corp. and online food delivery-to-ticketing services provider Meituan Dianping have listed two share classes, in Hong Kong’s second and third-largest IPOs last year raising US$5.4 billion and 4.9 billion respectively.

A number of biotech startups have also conducted initial public offerings under the new rules.

Driven by these IPOs, Hong Kong topped global financial centers for IPO volume in 2018.

HKEX’s revenue from listing fees rose 63 percent to HK$822 million, while trading fees rose 64 percent to HK$2.5 billion as trading turnover hit a record high.

Also last year, the average daily volume of metals contracts traded on HKEX-owned London Metals Exchange rose 5 percent.

The bourse operator will announce a three-year strategy Thursday, in which it is widely expected to set out plans to continue broadening its focus away from equity trading. (SD-Agencies)