CHICAGO, Oct. 29, 2015 /PRNewswire/ -- CME Group Inc.
(NASDAQ: CME) today reported revenues of $850 million and operating income of $516 million for the third quarter of 2015.
Net income was $360 million and
diluted earnings per share were $1.06. Excluding the items noted in the
reconciliation, adjusted net income would have been $344 million and adjusted diluted earnings per
share would have been $1.021.
"We delivered balanced organic revenue growth in the third
quarter," said CME Group Executive Chairman and President
Terry Duffy. "Commodity
products revenue grew by 14 percent, financial products were up 10
percent, and market data revenue rose 13 percent. This
top-line performance, coupled with solid expense discipline,
resulted in earnings growth above 20 percent, similar to the level
of growth produced during the first half of the year. In
addition, we generated a substantial amount of cash flow during the
quarter, positioning us well to return a meaningful amount of
capital to our shareholders in the coming months."
"Our focused growth initiatives are significantly increasing our
global activity," said CME Group Chief Executive
Officer Phupinder Gill. "For the third quarter,
electronic trading revenue from customers outside the United States reached a record 32
percent. Additionally, we have made system enhancements,
launched new products and heavily engaged with customers to
continue to drive our expanding options business. During the
quarter, we reached record levels of options volume and the highest
percentage of volume traded electronically. In addition, we
have been very active over the last few months partnering with
global exchanges and index providers to further drive long-term
growth."
1. A
reconciliation of the non-GAAP financial results mentioned to the
respective GAAP figures can be found within the Reconciliation of
GAAP to non-GAAP Measures chart at the end of the financial
statements.
|
Third-quarter 2015 average daily volume was 14.4 million
contracts, up 7 percent from third-quarter 2014, and included
record quarterly options average daily volume as well as double
digit growth across all commodities product lines. Clearing
and transaction fee revenues were $715
million, up 11 percent compared with third-quarter 2014.
Market data revenue was $100
million, up 13 percent compared with the third quarter last
year. Third-quarter 2015 total average rate per contract was
75.9 cents, down from 77.7 cents in second-quarter 2015, driven
primarily by higher volume discounts as well as a sequential
product mix shift from commodities to equity index products which
capture lower fees.
As of September 30, 2015, the
company had $1.5 billion of cash and
marketable securities and $2.2
billion of long-term debt. In September, the company
paid out $168 million in its regular
quarterly dividend of 50 cents per
share.
CME Group will hold a conference call to discuss
third-quarter 2015 results at 8:30 a.m.
Eastern Time today. A live audio Webcast of the call
will be available on the Investor Relations section of CME Group's
Web site at www.cmegroup.com. An archived recording will be available for
up to two months after the call.
As the world's leading and most diverse derivatives marketplace,
CME Group (www.cmegroup.com) is where the world comes to manage
risk. CME Group exchanges offer the widest range of global
benchmark products across all major asset classes, including
futures and options based on interest rates, equity indexes,
foreign exchange, energy, agricultural commodities, metals, weather
and real estate. CME Group brings buyers and sellers together
through its CME Globex® electronic trading platform, its trading
facilities in New
York and Chicago, and through its
London-based CME Europe
derivatives exchange. CME Group also operates one of the world's
leading central counterparty clearing providers through CME
Clearing and CME Clearing Europe, which offer clearing and
settlement services across asset classes for exchange-traded
contracts and over-the-counter derivatives transactions. These
products and services ensure that businesses everywhere can
substantially mitigate counterparty credit risk.
CME Group is a trademark of CME Group Inc. The Globe Logo, CME,
Globex and Chicago Mercantile Exchange are trademarks of Chicago
Mercantile Exchange Inc. CBOT and the Chicago Board of Trade are trademarks of the
Board of Trade of the City of
Chicago, Inc. NYMEX, New York Mercantile Exchange and
ClearPort are registered trademarks of New York Mercantile
Exchange, Inc. COMEX is a trademark of Commodity Exchange,
Inc. KCBOT, KCBT and Kansas
City Board of Trade are trademarks of The Board of Trade of
Kansas City, Missouri, Inc.
All other trademarks are the property of their respective owners.
Further information about CME Group (NASDAQ: CME) and its products
can be found at www.cmegroup.com.
Statements in this press release that are not historical facts
are forward-looking statements. These statements are not guarantees
of future performance and involve risks, uncertainties and
assumptions that are difficult to predict. Therefore, actual
outcomes and results may differ materially from what is expressed
or implied in any forward-looking statements. We want to caution
you not to place undue reliance on any forward-looking statements.
We undertake no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events
or otherwise. Among the factors that might affect our performance
are increasing competition by foreign and domestic entities,
including increased competition from new entrants into our markets
and consolidation of existing entities; our ability to keep pace
with rapid technological developments, including our ability to
complete the development, implementation and maintenance of the
enhanced functionality required by our customers while maintaining
reliability and ensuring that such technology is not vulnerable to
security risks; our ability to continue introducing competitive new
products and services on a timely, cost-effective basis, including
through our electronic trading capabilities, and our ability to
maintain the competitiveness of our existing products and services,
including our ability to provide effective services to the swaps
market; our ability to adjust our fixed costs and expenses if our
revenues decline; our ability to maintain existing customers,
develop strategic relationships and attract new customers; our
ability to expand and offer our products outside the United States; changes in domestic and
non-U.S. regulations, including the impact of any changes in
domestic and foreign laws or government policy with respect to our
industry, such as any changes to regulations and policies that
require increased financial and operational resources from us or
our customers; the costs associated with protecting our
intellectual property rights and our ability to operate our
business without violating the intellectual property rights of
others; decreases in revenue from our market data as a result of
decreased demand; changes in our rate per contract due to shifts in
the mix of the products traded, the trading venue and the mix of
customers (whether the customer receives member or non-member fees
or participates in one of our various incentive programs) and the
impact of our tiered pricing structure; the ability of our
financial safeguards package to adequately protect us from the
credit risks of clearing members; the ability of our compliance and
risk management methods to effectively monitor and manage our
risks, including our ability to prevent errors and misconduct and
protect our infrastructure against security breaches and
misappropriation of our intellectual property assets; changes in
price levels and volatility in the derivatives markets and in
underlying equity, foreign exchange, interest rate and commodities
markets; economic, political and market conditions, including the
volatility of the capital and credit markets and the impact of
economic conditions on the trading activity of our current and
potential customers; our ability to accommodate increases in
contract volume and order transaction traffic and to implement
enhancements without failure or degradation of the performance of
our trading and clearing systems; our ability to execute our growth
strategy and maintain our growth effectively; our ability to manage
the risks and control the costs associated with our strategy for
acquisitions, investments and alliances; our ability to
continue to generate funds and/or manage our indebtedness to allow
us to continue to invest in our business; industry and customer
consolidation; decreases in trading and clearing activity; the
imposition of a transaction tax or user fee on futures and options
on futures transactions and/or repeal of the 60/40 tax treatment of
such transactions; the unfavorable resolution of material legal
proceedings; and the seasonality of the futures business. For
a detailed discussion of these and other factors that might affect
our performance, see our filings with the Securities and Exchange
Commission, including our most recent periodic reports filed on
Form 10-K and Form 10-Q.
CME Group Inc. and
Subsidiaries
Consolidated
Balance Sheets
(in
millions)
|
|
|
|
September 30,
2015
|
|
December 31,
2014
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
1,434.3
|
|
$
|
1,366.1
|
Marketable
securities
|
|
72.4
|
|
74.7
|
Accounts receivable,
net of allowance
|
|
363.8
|
|
341.2
|
Other current assets
(includes $32.0 and $37.0 in restricted cash)
|
|
267.1
|
|
196.5
|
Performance bonds and
guaranty fund contributions
|
|
49,321.2
|
|
40,566.8
|
Total current
assets
|
|
51,458.8
|
|
42,545.3
|
Property, net of
accumulated depreciation and amortization
|
|
496.1
|
|
508.9
|
Intangible
assets—trading products
|
|
17,175.3
|
|
17,175.3
|
Intangible
assets—other, net
|
|
2,562.7
|
|
2,637.4
|
Goodwill
|
|
7,569.0
|
|
7,569.0
|
Other assets
(includes $71.6 and $72.4 in restricted cash)
|
|
1,687.7
|
|
1,805.6
|
Total
Assets
|
|
$
|
80,949.6
|
|
$
|
72,241.5
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
|
38.1
|
|
$
|
36.9
|
Other current
liabilities
|
|
239.5
|
|
927.5
|
Performance bonds and
guaranty fund contributions
|
|
49,321.2
|
|
40,566.8
|
Total current
liabilities
|
|
49,598.8
|
|
41,531.2
|
Long-term
debt
|
|
2,241.2
|
|
2,107.9
|
Deferred income tax
liabilities, net
|
|
7,341.5
|
|
7,302.7
|
Other
liabilities
|
|
391.3
|
|
376.2
|
Total
Liabilities
|
|
59,572.8
|
|
51,318.0
|
Shareholders'
equity
|
|
21,376.8
|
|
20,923.5
|
Total Liabilities and
Equity
|
|
$
|
80,949.6
|
|
$
|
72,241.5
|
CME Group Inc. and
Subsidiaries
Consolidated
Statements of Income
(dollars in
millions, except per share amounts; shares in
thousands)
|
|
|
|
Quarter Ended
September 30,
|
|
Nine Months
Ended
September
30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Revenues
|
|
|
|
|
|
|
|
|
Clearing and
transaction fees
|
|
$
|
715.0
|
|
$
|
641.8
|
|
$
|
2,105.0
|
|
$
|
1,903.3
|
Market data and
information services
|
|
99.5
|
|
87.7
|
|
300.3
|
|
266.7
|
Access and
communication fees
|
|
21.6
|
|
20.8
|
|
64.4
|
|
61.6
|
Other
|
|
14.2
|
|
12.1
|
|
43.3
|
|
39.8
|
Total
Revenues
|
|
850.3
|
|
762.4
|
|
2,513.0
|
|
2,271.4
|
Expenses
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
|
136.4
|
|
132.1
|
|
419.2
|
|
407.3
|
Communications
|
|
7.1
|
|
7.8
|
|
21.3
|
|
24.3
|
Technology support
services
|
|
15.4
|
|
13.8
|
|
47.1
|
|
42.3
|
Professional fees and
outside services
|
|
33.8
|
|
32.2
|
|
90.6
|
|
99.3
|
Amortization of
purchased intangibles
|
|
24.9
|
|
25.3
|
|
74.8
|
|
75.7
|
Depreciation and
amortization
|
|
32.4
|
|
32.7
|
|
97.5
|
|
101.1
|
Occupancy and
building operations
|
|
23.1
|
|
24.7
|
|
69.4
|
|
71.1
|
Licensing and other
fee agreements
|
|
33.1
|
|
25.5
|
|
92.5
|
|
80.2
|
Other
|
|
27.7
|
|
37.9
|
|
81.8
|
|
73.2
|
Total
Expenses
|
|
333.9
|
|
332.0
|
|
994.2
|
|
974.5
|
Operating
Income
|
|
516.4
|
|
430.4
|
|
1,518.8
|
|
1,296.9
|
Non-Operating
Income (Expense)
|
|
|
|
|
|
|
|
|
Investment
income
|
|
2.5
|
|
7.4
|
|
26.7
|
|
25.7
|
Gains (losses) on
derivative investments
|
|
—
|
|
—
|
|
(1.8
|
|
—
|
Interest and other
borrowing costs
|
|
(28.3
|
|
(28.7
|
|
(88.5
|
|
(90.7
|
Equity in net
earnings (losses) of unconsolidated subsidiaries
|
|
26.6
|
|
20.0
|
|
75.1
|
|
63.9
|
Other non-operating
income (expense)
|
|
(0.8
|
|
—
|
|
(42.0
|
|
1.8
|
Total
Non-Operating
|
|
—
|
|
(1.3
|
|
(30.5
|
|
0.7
|
Income before
Income Taxes
|
|
516.4
|
|
429.1
|
|
1,488.3
|
|
1,297.6
|
Income tax
provision
|
|
156.5
|
|
139.1
|
|
533.0
|
|
477.2
|
Net
Income
|
|
359.9
|
|
290.0
|
|
955.3
|
|
820.4
|
Less: net income
(loss) attributable to non-controlling interests
|
|
—
|
|
—
|
|
—
|
|
(0.2
|
Net Income
Attributable to CME Group
|
|
$
|
359.9
|
|
$
|
290.0
|
|
$
|
955.3
|
|
$
|
820.6
|
Earnings per
Common Share Attributable to CME Group:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
1.07
|
|
$
|
0.87
|
|
$
|
2.84
|
|
$
|
2.46
|
Diluted
|
|
1.06
|
|
0.86
|
|
2.83
|
|
2.44
|
Weighted Average
Number of Common Shares:
|
|
|
|
|
|
|
|
|
Basic
|
|
336,323
|
|
334,424
|
|
336,015
|
|
334,144
|
Diluted
|
|
338,139
|
|
336,172
|
|
337,804
|
|
335,820
|
CME Group Inc. and
Subsidiaries
Quarterly
Operating Statistics
|
|
|
|
3Q
2014
|
|
4Q
2014
|
|
1Q
2015
|
|
2Q
2015
|
|
3Q
2015
|
Trading
Days
|
|
64
|
|
64
|
|
61
|
|
64
|
|
64
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarterly Average
Daily Volume (ADV)
CME Group ADV (in
thousands)
|
|
Product
Line
|
|
3Q
2014
|
|
4Q
2014
|
|
1Q
2015
|
|
2Q
2015
|
|
3Q
2015
|
Interest
rate
|
|
7,181
|
|
7,445
|
|
7,564
|
|
6,599
|
|
6,658
|
Equity
|
|
2,586
|
|
3,114
|
|
2,772
|
|
2,364
|
|
3,287
|
Foreign
exchange
|
|
797
|
|
959
|
|
954
|
|
903
|
|
855
|
Energy
|
|
1,562
|
|
1,797
|
|
2,142
|
|
1,749
|
|
1,965
|
Agricultural
commodity
|
|
1,058
|
|
1,173
|
|
1,189
|
|
1,400
|
|
1,267
|
Metal
|
|
308
|
|
361
|
|
369
|
|
331
|
|
353
|
Total
|
|
13,493
|
|
14,848
|
|
14,990
|
|
13,347
|
|
14,384
|
Venue
|
|
|
|
|
|
|
|
|
|
|
Electronic
|
|
11,627
|
|
12,982
|
|
13,034
|
|
11,705
|
|
12,620
|
Open
outcry
|
|
1,208
|
|
1,218
|
|
1,291
|
|
1,108
|
|
1,110
|
Privately
negotiated
|
|
657
|
|
648
|
|
665
|
|
534
|
|
653
|
Total
|
|
13,493
|
|
14,848
|
|
14,990
|
|
13,347
|
|
14,384
|
|
|
Average Rate Per
Contract (RPC)
CME Group
RPC
|
|
Product
Line
|
|
3Q
2014
|
|
4Q
2014
|
|
1Q
2015
|
|
2Q
2015
|
|
3Q
2015
|
Interest
rate
|
|
$
|
0.473
|
|
$
|
0.472
|
|
$
|
0.480
|
|
$
|
0.502
|
|
$
|
0.506
|
Equity
|
|
0.687
|
|
0.697
|
|
0.721
|
|
0.725
|
|
0.708
|
Foreign
exchange
|
|
0.788
|
|
0.760
|
|
0.831
|
|
0.816
|
|
0.785
|
Energy
|
|
1.291
|
|
1.279
|
|
1.250
|
|
1.277
|
|
1.197
|
Agricultural
commodity
|
|
1.362
|
|
1.321
|
|
1.324
|
|
1.311
|
|
1.290
|
Metal
|
|
1.707
|
|
1.664
|
|
1.662
|
|
1.634
|
|
1.600
|
Average
RPC
|
|
$
|
0.725
|
|
$
|
0.731
|
|
$
|
0.753
|
|
$
|
0.777
|
|
$
|
0.759
|
CME Group Inc. and
Subsidiaries
|
Reconciliation of
GAAP to non-GAAP Measures
|
(dollars in
millions, except per share amounts; shares in
thousands)
|
|
|
|
|
|
|
|
Quarter
Ended
|
|
Quarter
Ended
|
|
|
September 30,
2015
|
|
September 30,
2014
|
GAAP Net
Income
|
|
$
|
359.9
|
|
$
|
290.0
|
|
|
|
|
|
Restructuring and
severance
|
|
13.6
|
|
—
|
|
|
|
|
|
Foreign exchange
transaction losses1
|
|
7.2
|
|
12.8
|
|
|
|
|
|
Acquisition-related
costs
|
|
—
|
|
2.7
|
|
|
|
|
|
Loss on sale of
BM&FBOVESPA shares
|
|
2.5
|
|
—
|
|
|
|
|
|
Income tax effect
related to above
|
|
(7.9)
|
|
(5.8)
|
|
|
|
|
|
|
Other income tax
items2
|
|
(31.4)
|
|
(18.9)
|
|
|
|
|
|
Adjusted Net
Income
|
|
$
|
343.9
|
|
$
|
280.8
|
|
|
|
|
|
GAAP Earnings per
Common Share:
|
|
|
|
|
Basic
|
|
$
|
1.07
|
|
$
|
0.87
|
Diluted
|
|
1.06
|
|
0.86
|
|
|
|
|
|
Adjusted Earnings
per Common Share:
|
|
|
|
|
Basic
|
|
$
|
1.02
|
|
$
|
0.84
|
Diluted
|
|
1.02
|
|
0.84
|
|
|
|
|
|
Weighted Average
Number of Common Shares:
|
|
|
|
|
Basic
|
|
336,323
|
|
334,424
|
Diluted
|
|
338,139
|
|
336,172
|
|
|
|
|
|
|
1.
Third-quarter 2014 and 2015 results included foreign exchange
transaction net losses principally related to cash held in British
pounds within foreign entities whose functional currency is the
U.S. dollar.
|
2. Other income tax
items include the impact of deferred tax benefit recognized for
remeasurement of state and local deferred income tax
benefits.
|
CME-G
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/cme-group-inc-reports-strong-third-quarter-2015-financial-results-300168347.html
SOURCE CME Group