Cboe Global Markets, Inc. · CBOE:CBOE
Cboe Global Markets — Bats Global Markets — Q2 2016 Earnings Presentation
23 slides from Cboe Global Markets's earnings presentation, Aug 4, 2016
Slide 1: Second Quarter 2016 – Earnings Call
Second Quarter 2016 – Earnings Call August 4, 2016
Slide 2: Disclaimers
Disclaimers Forward Looking Statements This presentation includes certain disclosures which contain “forward-looking statements.” You can identify forward-looking statements because they contain words such as “believes” and “expects.” Forward-looking statements are based on Bats’ current expectation
Slide 3: Defined Terms
Defined Terms Adjusted cash is defined as cash and cash equivalents and financial investments excluding cash received for payment of Section 31 fees. Adjusted earnings is defined as net income adjusted for amortization, acquisition-related costs, IPO costs, debt restructuring costs, and loss on
Slide 4: Corporate Update and Outlook
Corporate Update and Outlook Strong Growth in Net Revenue, Adjusted Earnings and Margin Existing Businesses Performing Extremely Well U.S. Equities (excluding auctions) remains #1 U.S. ETF trading remains #1 European Equities and Trade Reporting remain #1 U.S. Options – Price-Time Priori
Slide 5: 2Q16 Results
2Q16 Results Market Share U.S. Options achieved record quarterly market share of 11.6% while nearly doubling net capture year-on-year U.S. Equities market share decreased slightly in the 2nd quarter as market volatility was relatively flat until the end of June European Equities decreased due
Slide 6: 2Q16 Results
2Q16 Results Net Revenue Net revenue growth of 11% in the current quarter compared to the same period in the prior year driven by non-transaction revenue and increased net capture Net income decreased 12% in the current quarter compared to the same period in the prior year due to Net Income char
Slide 7: 2Q16 Financial Highlights
2Q16 Financial Highlights $109.9 million net revenue Net revenue increased 22% year-to-date Organic net revenue growth of 11% for the 2nd quarter and 18% year-to-date Non-transaction revenue responsible for 68% of net revenue growth 7
Slide 8: 2Q16 Financial Highlights
2Q16 Financial Highlights Normalized operating expenses were lower during the quarter as Direct Edge synergies were partially offset by a one-time operating tax credit recorded last year 2Q16 Normalized Operating Expenses 8
Slide 9: 2Q16 Financial Highlights
2Q16 Financial Highlights $33.9 million adjusted earnings 38% increase in adjusted earnings along with margin improvement 9
Slide 10: 2Q16 Financial Highlights
2Q16 Financial Highlights Leverage ratio well below maximum Available liquidity of $161.9 M* * Includes adjusted cash and financial instruments 10
Slide 11: Summary
Summary Achieved 11% organic net revenue growth; 18% year-to-date; Set a record for market share in U.S. Options at 11.6%; Remained the largest stock exchange and trade reporting service in Europe; Continued success in our ETF Trading and Listings business; Remain on track to deliver new p
Slide 12: Supplemental Data
SUPPLEMENTAL DATA Bats
Slide 13: 2Q16 Metrics
ee 2Q16 Metrics 2Q 16 Variance to 2Q15 2Q16 2Q15 Amount % Change _ U.S. Equities Market - Average Daily Volume (billions) 7.3 6.4 0.9 14.1% Market Share 20.4% 20.8% -0.4% Net Capture (per 100 shares) $ 0.022 «$ 0.023 $ (0.001) -4.3% European Equities Market - Average Daily Notional Value (€ in billi
Slide 14: Supplemental Data
eee Supplemental Data Bats Global Markets, Inc. Reconciliation of Net Income to EBITDA and Normalized EBITDA (unaudited - in millions) Three months ended June 30, 2016 U.S. Equities European Equities U.S. Options Global FX Corporate Consolidated Net income $ 16.3 Income tax expense 13.9 Income (loss
Slide 15: Supplemental Data
Supplemental Data Net income Income tax expense Income (loss) before income tax provision Interest Depreciation and amortization EBITDA Acquisition-related costs IPO costs Normalized EBITDA Net Revenue EBITDA margin (1) Normalized EBITDA margin (2) Bats Global Markets, Inc. Reconciliation of Net Inc
Slide 16: Supplemental Data
eee Supplemental Data Bats Global Markets, Inc. Reconciliation of Net Income to EBITDA and Normalized EBITDA (unaudited - in millions) Three months ended December 31, 2015 U.S. Equities European Equities U.S. Options Global FX Corporate Consolidated Net income $ 2.7 Income tax expense 13.6 Income (l
Slide 17: Supplemental Data
eee Supplemental Data Bats Global Markets, Inc. Reconciliation of Net Income to EBITDA and Normalized EBITDA (unaudited - in millions) Three months ended September 30, 2015 U.S. Equities European Equities U.S. Options Global FX Corporate Consolidated Net income $ 25.3 Income tax expense 17.2 Income
Slide 18: Supplemental Data
eee Supplemental Data Bats Global Markets, Inc. Reconciliation of Net Income to EBITDA and Normalized EBITDA (unaudited - in millions) Three months ended June 30, 2015 U.S. Equities European Equities U.S. Options Global FX Corporate Consolidated Net income $ 20.4 Income tax expense 15.8 Income (loss
Slide 19: Supplemental Data
eee Supplemental Data Bats Global Markets, Inc. Reconciliation of Cash and Cash Equivalents and Financial Investments to Adjusted Cash (unaudited - in millions) 6/30/2016 3/31/2016 12/31/2015 9/30/2015 6/30/2015 Cash and cash equivalents S$ 61.3 $ 77.1 5S 75.1 $ 77.9 $ 69.6 Add: Financial investment
Slide 20: Supplemental Data
eee Supplemental Data Bats Global Markets, Inc. Reconciliation of Adjusted Earnings (unaudited - in millions) 2Q16 2Q15 Net income S 17.9 S 20.4 Amortization 6.8 7.1 Acquisition-related costs 0.9 0.4 IPO costs 1.3 - Loss on extinguishment of debt 17.6 - Tax effects of adjustments (10.6) (3.3) Adjust
Slide 21: Supplemental Data
Supplemental Data Bats Global Markets, Inc. Reconciliation of Organic Net Revenue (unaudited - in millions) Three months ended Six months ended June 30, 2016 2015 $ 2217 $ 181.8 (10.4) (2.4) June 30, 2016 2015 Revenues less cost of revenues S$ 1099 $ 99.0 Global FX revenues less cost of revenues (fo
Slide 22: Supplemental Data
eee Supplemental Data Bats Global Markets, Inc. Reconciliation of Normalized Operating Expenses (unaudited - in millions) 2Q16 Normalized Operating operating expenses Adjustments expenses Compensation and benefits $ 23.0 $§ - $ 23.0 Depreciation and amortization 10.4 - 10.4 Systems and data communic
Slide 23: 2Q16 Net Revenue by Segment
2Q16 Net Revenue by Segment 23