Tue, 15/05/2018 - 12:28
Euronext, the pan-European exchange in the Eurozone with 1,300 listed issuers, reveals that during the first quarter of 2018 it saw an increase in revenue to EUR146.7 million (+15.9 per cent).
Cash trading revenues at EUR55.7 million were up +19.4 per cent, thanks to a sustained market share at 65.3 per cent, yield at 0.52bps and volume growth (ADV at EUR8.5 billion, up 21.9 per cent) in a high volatility environment.
Market data and indices revenue was up +15.4 per cent to EUR29.7 million and listing revenue was down -4.3per cent to EUR18.0 million in a mixed environment combining a strong IPO pipeline and high volatility.
The exchange group reports a growing contribution from revenue diversification initiatives with FastMatch and Agility for Growth contributing respectively for EUR5.2 million and EUR4.2 million to the Group’s revenue.
EBITDA up, at EUR88.2 million (+25.1 per cent), reaching 60.1 per cent margin (+4.4pts). EBITDA margin for core business and Agility for Growth, excluding clearing, at 63.5 per cent (up +6.8pts compared to Q1 2017). EUR16.2 million of cumulated core business gross efficiencies have been achieved since Q2 2016 thanks to cost discipline, the exchange group says.
Group staff costs and professional services are up due to the scope effect of FastMatch and other acquisitions, and the Irish Stock Exchange (now Euronext Dublin acquisition costs, while core business costs were down. Growth in EPS (basic) to EUR0.82 (+30.5 per cent). Adjusted EPS at EUR0.85 (+28.1 per cent).
Net income, share of the Group, at EUR57.3 million was up +30.6 per cent: combination of good operating performance, reduced exceptional items and first contribution from LCH SA equity stake. Continued capital deployment and expansion of the federal model. Corporate Services product offering complemented by the acquisition of 80 per cent of InsiderLog, for EUR5.8 million.
The first quarter also saw Euronext close its acquisition of Euronext Dublin and creation of the Group centre of excellence for Debt & Funds listings and ETFs.
Looking forward, Euronext has the launch of an inaugural seven-year, EUR500 million bond, 1 per cent coupon, rated A and listed on Euronext Dublin on 18 April 2018.
For the first time, Euronext has been rated A by S&P - stable outlook, reflecting confidence in Euronext’s cash flow profile and strategy.
Stéphane Boujnah, Chief Executive Officer and Chairman of the Managing Board of Euronext, says: “The first quarter of 2018 marked a strong start to the year, with very high revenue capture from trading activities in a volatile environment and good performance from our market data and indices businesses. As a result of strong cost discipline and operational leverage, this growth in revenue has directly benefited our EBITDA margin, reaching 60.1 per cent at Group level, despite the impact of newly acquired businesses, and 63.5 per cent EBITDA margin for core business and Agility for Growth business, excluding clearing. The current months are marked by sequentially lower volumes as volatility levels are now waning after the peak observed at the beginning of the year, while the IPO pipeline is building up.
“In March, Euronext reached a major milestone with the closing of the acquisition of the Irish Stock Exchange, now Euronext Dublin. The new combined Group has expanded its ambitions, with the creation of a Group centre of excellence for Debt & Fund listings and ETFs.
“To refinance its 2017 acquisitions and diversify its financing mix, Euronext successfully launched early April an inaugural 7-year, EUR500 million bond, listed on Euronext Dublin. The oversubscription of the order book along with Euronext’s first A, stable outlook, S&P rating, shows the confidence of investors and external parties in its profile and strategy.
“The second quarter has already seen the successful migration of bond regulated markets to the new Optiq matching engine and order entry gateway, paving the way for the full migration of cash markets in June.”
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