CHICAGO, April 27, 2017 /PRNewswire/ --
- Average daily volume reached a record 17.1 million
contracts, including records in Interest Rates, Metals, Interest
Rate Options and Equity Options
CME Group Inc. (NASDAQ: CME) today reported revenue of
$929 million and operating income of
$601 million for the first quarter of
2017. Net income was $400
million and diluted earnings per share were $1.18. On an adjusted basis, net income was
a record $416 million and diluted
earnings per share were a record $1.22. Financial results presented on an
adjusted basis for the first quarters of 2017 and 2016 exclude
certain items, which are detailed in the reconciliation of non-GAAP
results.1
"At a time of increased global uncertainty, our diverse products
and product extensions provide customers with highly effective ways
to manage risks across all major asset classes," said CME Group
Chairman and Chief Executive Officer Terry
Duffy. "This is reflected in our record first-quarter
results, which included our largest quarterly average daily volume
ever, with record volumes in interest rate futures and options,
metals futures and equity options. Our success is further
evidenced by the record open interest of more than 123 million
contracts we hit during the first quarter. At the same time,
we continue to focus on operational efficiency and expense
discipline. This gives us the opportunity to invest in our
long-term growth initiatives while returning excess cash to our
shareholders."
First-quarter 2017 average daily volume was a record 17.1
million contracts, up 1 percent compared with first-quarter
2016. Clearing and transaction fee revenue was $792 million, down 1 percent compared with
first-quarter 2016. First-quarter 2017 total average rate per
contract was 73.1 cents, flat with
fourth-quarter 2016. Market data revenue was $97 million, down 5 percent compared with the
first quarter last year.
As of March 31, 2017, the company
had $1.4 billion of cash and
marketable securities and $2.2
billion of long-term debt. The company paid dividends
during the first quarter of $1.3
billion, consisting of the annual variable dividend for 2016
of $1.1 billion and the regular
first-quarter dividend of $223
million. The company has returned more than
$7.7 billion to shareholders in the
form of dividends since the implementation of the variable dividend
policy in early 2012.
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 and earnings
presentation materials.
|
|
CME Group will hold a conference call to discuss
first-quarter 2017 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. Through its exchanges, CME Group offers 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 products and
metals. CME Group provides electronic trading globally on its
CME Globex platform. The company also offers clearing
and settlement services across asset classes for exchange-traded
and over-the-counter derivatives through its clearinghouses CME
Clearing and CME Clearing Europe. CME Group's products and
services ensure that businesses around the world can effectively
manage risk and achieve growth.
CME Group, the Globe logo, CME, Chicago Mercantile Exchange,
Globex and E-mini are trademarks of Chicago Mercantile Exchange
Inc. CBOT, Chicago Board of
Trade, KCBT and Kansas City Board
of Trade are trademarks of Board of Trade of the City of Chicago, Inc. NYMEX, New York
Mercantile Exchange and ClearPort are trademarks of New York
Mercantile Exchange, Inc. COMEX is a trademark of Commodity
Exchange, Inc. Dow Jones, Dow Jones Industrial Average,
S&P 500 and S&P are service and/or trademarks of Dow Jones
Trademark Holdings LLC, Standard & Poor's Financial Services
LLC and S&P/Dow Jones Indices LLC, as the case may be, and have
been licensed for use by Chicago Mercantile Exchange Inc. All
other trademarks are the property of their respective owners.
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
regulations, including the impact of any changes in 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; and the unfavorable
resolution of material legal proceedings. 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)
|
|
|
|
March 31,
2017
|
|
December 31,
2016
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
1,287.8
|
|
|
$
|
1,868.6
|
|
Marketable
securities
|
|
87.1
|
|
|
83.3
|
|
Accounts receivable,
net of allowance
|
|
426.6
|
|
|
364.4
|
|
Other current assets
(includes $30.0 in restricted cash)
|
|
145.8
|
|
|
171.7
|
|
Performance bonds and
guaranty fund contributions
|
|
44,421.2
|
|
|
37,543.5
|
|
Total current
assets
|
|
46,368.5
|
|
|
40,031.5
|
|
Property, net of
accumulated depreciation and amortization
|
|
411.6
|
|
|
425.2
|
|
Intangible
assets—trading products
|
|
17,175.3
|
|
|
17,175.3
|
|
Intangible
assets—other, net
|
|
2,417.8
|
|
|
2,441.8
|
|
Goodwill
|
|
7,569.0
|
|
|
7,569.0
|
|
Other assets
(includes $62.4 and $61.7 in restricted cash)
|
|
1,533.8
|
|
|
1,726.6
|
|
Total
Assets
|
|
$
|
75,476.0
|
|
|
$
|
69,369.4
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
|
38.4
|
|
|
$
|
26.2
|
|
Other current
liabilities
|
|
345.2
|
|
|
1,376.7
|
|
Performance bonds and
guaranty fund contributions
|
|
44,421.2
|
|
|
37,542.7
|
|
Total current
liabilities
|
|
44,804.8
|
|
|
38,945.6
|
|
Long-term
debt
|
|
2,231.6
|
|
|
2,231.2
|
|
Deferred income tax
liabilities, net
|
|
7,308.4
|
|
|
7,291.0
|
|
Other
liabilities
|
|
577.0
|
|
|
560.9
|
|
Total
Liabilities
|
|
54,921.8
|
|
|
49,028.7
|
|
Shareholders'
equity
|
|
20,554.2
|
|
|
20,340.7
|
|
Total Liabilities and
Equity
|
|
$
|
75,476.0
|
|
|
$
|
69,369.4
|
|
CME Group Inc. and
Subsidiaries
|
Consolidated
Statements of Income
|
(dollars in millions,
except per share amounts; shares in thousands)
|
|
|
|
Quarter
Ended March
31,
|
|
|
2017
|
|
2016
|
Revenues
|
|
|
|
|
Clearing and
transaction fees
|
|
$
|
792.0
|
|
|
$
|
796.1
|
|
Market data and
information services
|
|
96.8
|
|
|
102.4
|
|
Access and
communication fees
|
|
24.3
|
|
|
21.6
|
|
Other
|
|
16.2
|
|
|
14.1
|
|
Total
Revenues
|
|
929.3
|
|
|
934.2
|
|
Expenses
|
|
|
|
|
Compensation and
benefits
|
|
142.3
|
|
|
131.9
|
|
Communications
|
|
6.3
|
|
|
6.7
|
|
Technology support
services
|
|
18.7
|
|
|
17.4
|
|
Professional fees and
outside services
|
|
28.6
|
|
|
31.7
|
|
Amortization of
purchased intangibles
|
|
24.0
|
|
|
24.0
|
|
Depreciation and
amortization
|
|
29.4
|
|
|
33.9
|
|
Occupancy and
building operations
|
|
20.1
|
|
|
21.3
|
|
Licensing and other
fee agreements
|
|
33.8
|
|
|
39.0
|
|
Other
|
|
24.9
|
|
|
54.4
|
|
Total
Expenses
|
|
328.1
|
|
|
360.3
|
|
Operating
Income
|
|
601.2
|
|
|
573.9
|
|
Non-Operating
Income (Expense)
|
|
|
|
|
Investment
income
|
|
138.9
|
|
|
17.6
|
|
Interest and other
borrowing costs
|
|
(29.8)
|
|
|
(29.8)
|
|
Equity in net
earnings (losses) of unconsolidated subsidiaries
|
|
30.8
|
|
|
26.8
|
|
Other non-operating
income (expense)
|
|
(34.1)
|
|
|
(10.0)
|
|
Total
Non-Operating Income (Expense)
|
|
105.8
|
|
|
4.6
|
|
Income before
Income Taxes
|
|
707.0
|
|
|
578.5
|
|
Income tax
provision
|
|
307.2
|
|
|
210.7
|
|
Net
Income
|
|
$
|
399.8
|
|
|
$
|
367.8
|
|
Earnings per
Common Share:
|
|
|
|
|
Basic
|
|
$
|
1.18
|
|
|
$
|
1.09
|
|
Diluted
|
|
1.18
|
|
|
1.09
|
|
Weighted Average
Number of Common Shares:
|
|
|
|
|
Basic
|
|
338,339
|
|
|
337,014
|
|
Diluted
|
|
339,946
|
|
|
338,549
|
|
CME Group Inc. and
Subsidiaries
|
Quarterly
Operating Statistics
|
|
|
|
1Q
2016
|
|
2Q
2016
|
|
3Q
2016
|
|
4Q
2016
|
|
1Q
2017
|
Trading
Days
|
|
|
61
|
|
|
|
64
|
|
|
|
64
|
|
|
|
63
|
|
|
|
62
|
|
|
Quarterly Average
Daily Volume (ADV)
|
CME Group ADV (in
thousands)
|
|
Product
Line
|
|
1Q
2016
|
|
2Q
2016
|
|
3Q
2016
|
|
4Q
2016
|
|
1Q
2017
|
Interest
rate
|
|
|
8,246
|
|
|
|
6,776
|
|
|
|
6,791
|
|
|
|
8,300
|
|
|
|
9,169
|
|
Equity
|
|
3,557
|
|
|
2,957
|
|
|
2,876
|
|
|
2,875
|
|
|
2,766
|
|
Foreign
exchange
|
|
944
|
|
|
838
|
|
|
772
|
|
|
883
|
|
|
894
|
|
Energy
|
|
2,536
|
|
|
2,322
|
|
|
2,294
|
|
|
2,586
|
|
|
2,496
|
|
Agricultural
commodity
|
|
1,206
|
|
|
1,722
|
|
|
1,156
|
|
|
1,193
|
|
|
1,261
|
|
Metal
|
|
454
|
|
|
468
|
|
|
431
|
|
|
488
|
|
|
512
|
|
Total
|
|
16,944
|
|
|
15,082
|
|
|
14,319
|
|
|
16,325
|
|
|
17,098
|
|
Venue
|
|
|
|
|
|
|
|
|
|
|
Electronic
|
|
14,713
|
|
|
13,355
|
|
|
12,672
|
|
|
14,375
|
|
|
14,947
|
|
Open
outcry
|
|
1,423
|
|
|
1,075
|
|
|
982
|
|
|
1,130
|
|
|
1,362
|
|
Privately
negotiated
|
|
807
|
|
|
651
|
|
|
665
|
|
|
820
|
|
|
789
|
|
Total
|
|
16,944
|
|
|
15,082
|
|
|
14,319
|
|
|
16,325
|
|
|
17,098
|
|
|
Average Rate Per
Contract (RPC)
|
CME Group
RPC
|
|
Product
Line
|
|
1Q
2016
|
|
2Q
2016
|
|
3Q
2016
|
|
4Q
2016
|
|
1Q
2017
|
Interest
rate
|
|
$
|
0.501
|
|
|
$
|
0.496
|
|
|
$
|
0.508
|
|
|
$
|
0.491
|
|
|
$
|
0.492
|
|
Equity
|
|
0.726
|
|
|
0.709
|
|
|
0.676
|
|
|
0.691
|
|
|
0.718
|
|
Foreign
exchange
|
|
0.767
|
|
|
0.798
|
|
|
0.806
|
|
|
0.804
|
|
|
0.823
|
|
Energy
|
|
1.203
|
|
|
1.168
|
|
|
1.097
|
|
|
1.099
|
|
|
1.130
|
|
Agricultural
commodity
|
|
1.321
|
|
|
1.291
|
|
|
1.335
|
|
|
1.336
|
|
|
1.334
|
|
Metal
|
|
1.597
|
|
|
1.562
|
|
|
1.542
|
|
|
1.486
|
|
|
1.496
|
|
Average
RPC
|
|
$
|
0.756
|
|
|
$
|
0.782
|
|
|
$
|
0.750
|
|
|
$
|
0.731
|
|
|
$
|
0.731
|
|
CME Group Inc. and
Subsidiaries
|
Reconciliation of
GAAP to non-GAAP Measures
|
(dollars in millions,
except per share amounts; shares in thousands)
|
|
|
|
Quarter
Ended March
31,
|
|
|
2017
|
|
2016
|
Net
Income
|
|
$
|
399.8
|
|
|
$
|
367.8
|
|
|
|
|
|
|
Restructuring and
severance
|
|
1.8
|
|
|
—
|
|
|
|
|
|
|
Amortization of
purchased intangibles
|
|
24.0
|
|
|
24.0
|
|
|
|
|
|
|
Loss on disposal of
building assets
|
|
—
|
|
|
1.3
|
|
|
|
|
|
|
Loss and expenses
related to sale-leaseback of data center
|
|
—
|
|
|
28.6
|
|
|
|
|
|
|
Foreign exchange
transaction losses (gains)1
|
|
(2.5)
|
|
|
3.9
|
|
|
|
|
|
|
(Gains) losses on
sale of BM&FBOVESPA shares
|
|
(86.5)
|
|
|
—
|
|
|
|
|
|
|
Income tax effect
related to above2
|
|
(8.9)
|
|
|
(20.5)
|
|
|
|
|
|
|
Other income tax
item3
|
|
87.8
|
|
|
—
|
|
|
|
|
|
|
Adjusted Net
Income
|
|
$
|
415.5
|
|
|
$
|
405.1
|
|
|
|
|
|
|
GAAP Earnings per
Common Share:
|
|
|
|
|
Basic
|
|
$
|
1.18
|
|
|
$
|
1.09
|
|
Diluted
|
|
1.18
|
|
|
1.09
|
|
|
|
|
|
|
Adjusted Earnings
per Common Share:
|
|
|
|
|
Basic
|
|
$
|
1.23
|
|
|
$
|
1.20
|
|
Diluted
|
|
1.22
|
|
|
1.20
|
|
|
|
|
|
|
Weighted Average
Number of Common Shares:
|
|
|
|
|
Basic
|
|
338,339
|
|
|
337,014
|
|
Diluted
|
|
339,946
|
|
|
338,549
|
|
|
|
|
|
|
1. Results include
foreign exchange transaction net gains and losses principally
related to cash held in British pounds within foreign entities
whose functional currency is the U.S. dollar.
|
2. Income tax effect
related to all of the above includes all of the items above except
for the tax impact related to the gain on sale of BM&FBOVESPA
shares.
|
3. In conjunction
with the final sale of BM&FBOVESPA shares, we reclassified
income tax expense from accumulated other comprehensive income to
the income tax provision.
|
CME-G
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/cme-group-inc-reports-strong-first-quarter-2017-financial-results-300446914.html
SOURCE CME Group Inc.