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CME Group reports strong Q1 2016 results

CME Group reports strong Q1 2016 results


CME Group has reported record revenue of USD934 million and record operating income of USD574 million for the first quarter of 2016. Net income was USD368 million and diluted earnings per share were USD1.09.  

Adjusted for non-recurring items, net income would have been USD390 million and diluted earnings per share would have been USD1.151.

"Our record first-quarter financial performance was driven by our highest quarterly average daily volume to date, including record volumes in energy, overall options and electronic options," says CME Group Executive Chairman and President Terry Duffy (pictured). "We delivered record revenue and operating income, and 17 percent growth in adjusted diluted earnings per share. These strong results reflect our continued progress in executing on our long-term growth initiatives. At the same time, we are committed to returning cash to our shareholders, as evidenced by USD1.2 billion in dividends being paid out during the quarter."

"Strong, balanced performance across our diverse product portfolio, coupled with a continued focus on expense discipline, allowed us to expand our operating margin in the first quarter," says CME Group Chief Executive Officer Phupinder Gill.  "We saw a significant increase in global participation in our markets, with average daily volume of 3.7 million contracts traded from outside of the United States, up 24 percent from first-quarter 2015.  The solid quarterly activity was underscored by continued momentum in open interest, as we reached a record daily level of 116 million contracts in the first quarter, and open interest remains elevated."

First-quarter 2016 average daily volume was a record 16.9 million contracts, up 13 percent from first-quarter 2015, and included quarterly records in energy, total options and electronic options.  Clearing and transaction fee revenue was USD796 million, up 12 percent compared with first-quarter 2015.  First-quarter 2016 total average rate per contract was 75.6 cents, down from 78.9 cents in fourth-quarter 2015, driven primarily by a sequential product mix shift with an increased proportion of the volume from financial contracts which capture lower fees.  Market data revenue was USD102 million, up 5 percent compared with the first quarter last year.

As of 31 March, 2016, the company had USD1.2 billion of cash and marketable securities and USD2.2 billion of long-term debt. The quarter-end cash balance includes USD130 million from the company's sale/leaseback transaction with CyrusOne, Inc. related to the company's suburban Chicago data centre. The company paid dividends during the first quarter of nearly USD1.2 billion, consisting of the annual variable dividend for 2015 of USD977 million and the regular first-quarter dividend of USD203 million. The company has returned more than USD5.8 billion to shareholders in the form of dividends since the implementation of the variable dividend policy in early 2012.

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