Slide 1: Third Quarter 2012 Earnings Presentation
IntercontinentalExchange Third Quarter 2012 Earnings Presentation November 5, 2012
Slide 2: Forward-Looking Statement
Forward-Looking Statement FORWARD-LOOKING STATEMENTS This presentation may contain “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements regarding our business that are not historical facts are forward-looking sta
Slide 3: Earnings Conference Call – Third Quarter 2012
Earnings Conference Call – Third Quarter 2012 Jeffrey C. Sprecher Chairman and Chief Executive Officer Scott A. Hill Senior Vice President, Chief Financial Officer Charles A. Vice President, Chief Operating Officer Kelly L. Loeffler, CFA Melanie S. Skijus, CFA Vice President, Investor Relations & Di
Slide 4: Growth through Evolving Regulatory Marketplace
Growth through Evolving Regulatory Marketplace ICE Revenues Financial Performance: YTD Sep 2012 $1,327 $1,400 +4% y/y Record revenues +4% y/y to $1B $1,150 $995 $1,040 Operating income +6% y/y; expense +1% y/y $1,050 $813 61% operating margin vs. 60% in year-ago period $700 $574 Net income a
Slide 5: ICE Financial Highlights – Third Quarter 2012
ICE Financial Highlights – Third Quarter 2012 In millions, except per share amounts Change INCOME STATEMENT 3Q12 3Q11 y/y Low volatility and regulatory uncertainty Total Revenues $323 $341 -5% impacted volume Total Expenses $129 $137 -6% Operating Income $194 $204 -5% Disciplined expense managem
Slide 6: Revenue & Expense Detail – Third Quarter 2012
Revenue & Expense Detail – Third Quarter 2012 3Q12 Consolidated Revenues 3Q12 Consolidated Expenses SG&A OTC Credit & Rent Market Data & Other Tech. & Deprec. & 10% 10% 14% Communications Amortization 25% 9% 11% Soft/Ag Futures Prof. Services 28% & Acq. Costs 8% OTC Energy 3% Index/FX 9% Futures Non
Slide 7: ICE Futures Segment – Third Quarter 2012
ICE Futures Segment – Third Quarter 2012 Annual Futures & Options Volume1 400 381 +1% y/y Futures revenues $156MM, +1% y/y 329 300 294 Average daily volume (ADV) of 1.5MM, -4% y/y 262 237 Strength in Brent, Energy options and Sugar 196 200 Rate Per Contract (RPC) Energy Ags Financials 100 3Q
Slide 8: ICE OTC Segment – Third Quarter 2012
ICE OTC Segment – Third Quarter 2012 Annual OTC Average Daily Commissions (ADC) 3Q12 OTC revenues of $123MM, -16% y/y -1% y/y 2500 3Q12 OTC energy revenues of $90MM, -10% y/y $2,241 $2,222 o OTC Energy ADC of $1.4MM, -9% y/y $2,031 2000 $1,857 o 29 new cleared energy contracts launched o $13MM i
Slide 9: Increased Transparency & Streamlined Reporting
Increased Transparency & Streamlined Reporting • Move from OTC to futures provides enhanced volume disclosure • Daily volumes now reported in ICE Report Center at theice.com o Volume categories include Energy, Ags and Financials o Historical information available at ir.theice.com o ADC will not be r
Slide 10: Robust Cash Generation & Strong Balance Sheet
Robust Cash Generation & Strong Balance Sheet ICE Operating Cash Flow Solid Cash Position $800 $573MM in operating cash flow YTD Sep $713 +6% y/y $573 $1.2B in unrestricted cash $600 $534 $487 $2B undrawn credit facility $375 $400 Debt-to-EBITDA ratio of 0.9x $288 $200 Capital Management in
Slide 11: Delivering solutions for financial reform
Delivering solutions for financial reform Leadership in helping customers meet new compliance requirements Transitioned energy swaps to futures providing regulatory certainty ICE Trade Vault’s Swap Data Repository (SDR) began accepting trade data for CDS in Oct ‘12 Working with the industry
Slide 12: Company and Market Long-term Growth Drivers
Company and Market Long-term Growth Drivers Growth Drivers Energy • Strong secular growth in globally relevant commodities • Global leader in Brent, gasoil, natural gas and power markets • Rising demand for risk management tools • Timely transition of energy swaps to futures, SDR launched Oct ‘12 •
Slide 13: Leadership Position in Global Energy Markets
Leadership Position in Global Energy Markets ADV (000) Increasing Crude Market Share 800 60% ICE Brent futures contracts, up 15% YTD, on track 700 55% for 15th consecutive year of volume records 600 50% ICE Brent options volume up 349% yty in 3Q12 500 45% 400 40% Successful transition of clear
Slide 14: Consistently Outperforming the Sector
Consistently Outperforming the Sector 2012 YTD Revenue Growth 2012 YTD Operating Margin 4% 61% 58% 53% 41% ICE CME NDAQ DB1 GFIG -2% -8% -9% 1% -11% ICE CME NDAQ DB1 GFIG 2012 YTD EPS Growth 2012 YTD Profit Per Employee (000’s) 11% $393 ICE CME NDAQ DB1 GFIG -9% $287 -31% -32% $106 $54 $1 -100% ICE
Slide 15: A Focus On Consistent Growth and Results
A Focus On Consistent Growth and Results Operating Income Growth Priorities $800 1. Drive growth in core business 2. Prudent expense management $600 3. Evaluate capital & strategic opportunities $400 4. Leadership in financial reform solutions $200 5. Invest for long-term growth ‘10 ‘11 ’12E ’13E $0
Slide 16: Appendix
APPENDIX
Slide 17: ICE Summary Balance Sheet
ICE Summary Balance Sheet In millions BALANCE SHEET 9/30/12 12/31/11 CHANGE Low leverage with debt to trailing EBITDA of 0.9x as of 9/30/12 Assets Unrestricted Cash $1,241 $823 $418 Unrestricted cash of $1.2B; $850MM Other Current Assets 32,793 31,782 1,011 debt outstanding as of 9/30/12 Current
Slide 18: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation In thousands 9 Months 9 Months 3 Months 3 Months Ended Ended Ended Ended 9/30/12 9/30/11 9/30/12 9/30/11 Net income attributable to ICE $422,104 $382,900 $131,082 $132,631 Plus income tax expense 177,114 184,557 50,552 59,103 Less interest and investment income (1,014)
Slide 19: Adjusted Net Income and EPS Reconciliation
Adjusted Net Income and EPS Reconciliation 9 Months 3 Months Ended Ended 9/30/11 9/30/11 Net income attributable to ICE $382,900 $132,631 Add: Cetip investment banking fee 4,250 4,250 Adjusted net income attributable to ICE $387,150 $136,881 Earnings per share attributable to ICE common shareholders
Slide 20: Historical Futures Metrics
Historical Futures Metrics 2012 Trading Days* 20 20 22 20 22 21 21 23 19 23 21 20 252 Average Daily Volume (000s) Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12 Nov-12 Dec-12 2012 Energy 3,700 3,596 2,807 2,795 3,075 3,032 2,703 2,576 2,888 3,067 Ags 228 301 248 311 230 336 23