Intercontinental Exchange Inc. · NYSE:ICE

Intercontinental Exchange — 2011 Credit Suisse Financials Conference

22 slides from Intercontinental Exchange's conference presentation, Feb 11, 2011

  1. Slide 1: 2011 Credit Suisse Financials Conference

    Click to edit Master title style y 2011 Credit Suisse Financials Conference Miami | February 10-11, 2011 IntercontinentalExchange

  2. Slide 2: Safe Harbor

    Safe Harbor 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. 1995 Statements regarding our business that are not historical facts are forward-looking forward look

  3. Slide 3: ICE: Derivatives Market Leadership

    ICE: Derivatives Market Leadership Building on a Solid Market Position ICE Annual Contract Volume +27% y/y 700 662 ƒ Global franchise 600 504 523 \ Footprint and domain knowledge 500 379 400 ƒ Broad distribution and network effect 300 232 \ Diverse futures and OTC markets, and clearing 200 ƒ Organic

  4. Slide 4: Diverse Growth Platform

    Diverse Growth Platform Global Market Infrastructure ƒ 4 futures exchanges ƒ 2 OTC markets ƒ 5 clearing g houses ƒ 5 asset classes: ags, credit, energy, equity index & FX ƒ Approximately 50% of global crude and refined futures market share ƒ Leading connectivity and trading technology ƒ Over 2.6MM f

  5. Slide 5: ICE Markets

    ICE Markets ICE’s global futures and over-the-counter markets serve the global commodity and derivatives markets on one integrated trading platform. ICE Revenue Diversification OTC Credit ICE Average Daily Volume Market Data/Other 2 500 2,500 14% 11% 2,000 OTC Energy Soft/Ag Futures 1,500 12% 31% 20

  6. Slide 6: ICE Futures

    ICE Futures Annual Futures and Options Volume1 +25% y/y 350 ƒ 4Q10 $127MM in revenues, +24% y/y 329 300 262 ƒ 4Q10 ADV of 1.27MM contracts, +21% 21% y/y 250 237 194 ƒ 4Q10 strong growth in Brent, Gasoil, Cotton, Sugar 200 137 o Energy futures ADV of 848K, +23% y/y 150 o Ag g & Fin ADV of 416K, +16%

  7. Slide 7: ICE OTC Markets – Energy & Credit

    ICE OTC Markets – Energy & Credit Annual OTC Energy ADC +14% y/y ƒ 4Q10 $125MM in OTC revenues: record OTC energy $1,374 volume of 88MM $1,500 $1 202 $1,202 $1,117 ƒ Quarterly OTC energy revenue of $87MM, flat y/y o Energy ADC of $1.33MM in 4Q10 $1,000 $845 o YTD 2011 ADC of over $1.6MM $589 ƒ Quart

  8. Slide 8: Long-term Growth Drivers

    Long-term Growth Drivers Secular Drivers ƒ Rising demand for commodities ƒ Increased use of risk management and hedging tools across industries ƒ Growth in emerging economies and recovery in Western economies ƒ Evolving regulatory landscape emphasizes transparency and clearing ICE Specific Drivers ƒ

  9. Slide 9: Exposure to Growth Markets

    Exposure to Growth Markets Geographic diversification ƒ 47% of revenues from outside of U.S. ƒ EU/Canadian exchanges /clearinghouses 2010 Revenue by Geography ƒ Globally relevant products, levered to 100% emerging economies 80% 57% 53% 60% Broad Energy Complex ƒ Benchmark Brent, Gasoil and WTI oil m

  10. Slide 10: Strategic Approach to New Markets

    Strategic Approach to New Markets Product & Platform Initiatives: 2010 New Products & Services ƒ Execution E ti and d clearing l i enhancements h t ƒ Additional new products in 2011 ƒ 90+ new cleared energy products ƒ Leverage strong energy footprint ƒ OTC oil revenues up 72% in 2010 ƒ Opportunities

  11. Slide 11: Leadership in Evolving Markets

    Leadership in Evolving Markets Long-term Market Opportunity ADC and % Cleared $1,400 100% C ADC ) $1,200 OTC Energy 80% ousands (Energy OTC $1,000 ƒ Trade automation in ‘00 % Cleared $800 60% ƒ Pioneered OTC energy clearing ’02 $600 40% ƒ 300 new products introduced since 2009 $400 20% Tho $200 ƒ 95

  12. Slide 12: Innovation and Execution on Initiatives

    Innovation and Execution on Initiatives ICE’s focus on leading-edge technology enables successful execution on key initiatives. • Leader in electronic trading of commodities – 1st fully electronic energy exchange TECHNOLOGY • Roundtrip trading time < 1 millisecond LEADERSHIP • Best reliability: 99.9

  13. Slide 13: Long-term Double-digit Growth

    Long-term Double-digit Growth Revenue Growth +16% y/y ƒ Double-digit growth target over the long $1,200 $1,150 term: $995 $1,000 › 2010 revenues up 16%; adj. exp1 up only 5% $813 $800 ƒ Record revenues driven by record futures $600 $574 and OTC segments $400 $314 › Fut. rev: $504MM,+23% y/y $200 › O

  14. Slide 14: Strong Balance Sheet & Cash Flow

    Strong Balance Sheet & Cash Flow Operating Cash Flow +10% y/y $600 Strong Cash Generating Model $534 $487 $500 ƒ Cash balance $400 $375 $624MM unrestricted $288 ƒ 3-year average free cash flow yield 5.5% $300 ƒ 2010 operating cash flow $534MM $200 $151 $100 $0 Disciplined Use of Capital 2006 2007 20

  15. Slide 15: ICE Investment Thesis

    ICE Investment Thesis Global Risk Management Platform ƒ Building on a strong franchise › Futures markets remain a solid g growth area › Key benchmarks provide entry into international markets › Clearinghouses support new product development and increased demand for risk management ƒ Redefining deriv

  16. Slide 16: Appendix

    Click to edit Master title style y Appendix IntercontinentalExchange

  17. Slide 17: ICE Summary Financials – FY 2010

    ICE Summary Financials – FY 2010 Change ƒ FY 2010 revenues up 16%; adjusted INCOME STATEMENT FY2010 FY2009 y/y expenses1 up only 5% Total Revenues $1,150 $995 16% ƒ Record revenues driven by record Total Expenses $498 $482 3% futures and OTC segments Operating Income $652 $513 27% o Fut. rev: $ $504

  18. Slide 18: ICE Average Daily Volume History

    ICE Average g Daily y Volume History y SLIDE 19 ICE Average Daily Volume 2011 Januaryy February y March April p May y June July y August g September p October November December ICE Futures Europe 1,176,543 ICE Futures U.S. 383,157 ICE Futures Canada 17,775 CCFE 752 TOTAL 1,578,227 2010 January Febru

  19. Slide 19: ICE Futures Rate Per Contract History

    ICE Futures Rate Per Contract Historyy SLIDE 20 Rolling Three-Month Average Rate per Contract 2011 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec ICE Futures Europe Futures $ 1.53 ICE Futures U.S. Agricultural Futures & Options $ 2.06 ICE Futures U.S. Financial Futures & Options $ 0.94 2010 Jan Feb

  20. Slide 20: Non-GAAP Net Income Attributable to ICE & EPS Reconciliation

    Non-GAAP Net Income Attributable to ICE & EPS Reconciliation SLIDE 21 In thousands, except per share amounts 12 Months 3 Months 12 Months 3 Months Ended Ended Ended Ended 12/31/10 12/31/10 12/31/09 12/31/09 Net income attributable to ICE $398,298 $99,132 $315,988 $84,254 Add: Loss on hedge related t

  21. Slide 21: Non-GAAP EBITDA Reconciliation

    Non-GAAP EBITDA Reconciliation SLIDE 22 In thousands 12 Months 12 Months 12 Months 12 Months 12 Months Ended Ended Ended Ended Ended 12/31/10 12/31/09 12/31/08 12/31/07 12/31/06 Net income attributable to ICE $398,298 $315,988 $300,972 $240,612 $143,269 Plus income tax expense 202,375 179,551 172,52

  22. Slide 22: Non-GAAP Operating Income, Operating Margin & Operating Expense Reconciliation

    Non-GAAP Operating Income, Operating Margin & Operating Expense p Reconciliation SLIDE 22 In thousands 12 Months 12 Months Ended Ended 12/31/10 12/31/09 Total Revenues $1,149,944 $994,788 Total operating expenses 497,695 482,169 Less: Acquisition-related trasaction costs (9,996) (6,139) Less: Lease

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