Intercontinental Exchange Inc. · NYSE:ICE
Intercontinental Exchange — Q4 2022 Earnings Presentation
25 slides from Intercontinental Exchange's earnings presentation, Feb 2, 2023
Slide 1: 4Q22 Earnings Supplement
4Q22 Earnings Supplement February 2, 2023 1
Slide 2: Cautionary Statement Regarding Forward Looking Statements
CAUTIONARY STATEMENT REGARDING 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 ICE’s business that are not historical facts are forward-look
Slide 3: ICE Fourth Quarter 2022 Earnings Call Participants
ICE Fourth Quarter 2022 Earnings Call Participants Jeff Sprecher Ben Jackson Warren Gardiner Lynn Martin Katia Gonzalez Chair & CEO President Chief Financial Officer President, NYSE Senior Analyst, Investor Chair, ICE Mortgage Chair, Fixed Income Relations Technology & Data Services 3
Slide 4: 4Q22 ICE Performance
4Q22 ICE Performance in millions except per share amounts +4 % Income statement highlights 4Q22 4Q21 4Q % FY % Chg, CC Chg, CC FY total revenues, CC Revenues, net $1,768 $1,840 (2)% 4% Recurring Revenues 940 906 4% 7% Transaction Revenues, net 828 934 (9)% 1% Adj. Op Expenses $740 $749 —% —% Record
Slide 5: 4Q22 Exchanges Performance
4Q22 Exchanges Performance in millions Revenue, net 4Q22 4Q21 4Q % Chg 4QCurr Const FY Const Curr Energy Ags $278 56 $336 51 (17)% 9% (15)% 11% (4)% 4% +13 % 4Q equity indices revenue, CC Financials 100 113 (12)% (3)% 30% Cash Equities & Equity Options, net 92 89 3% 3% 7% 34 OTC & Other 103 87 17% 2
Slide 6: 4Q22 Fixed Income & Data Services Performance
4Q22 Fixed Income & Data Services Performance Record total revenue in millions Revenue 4Q22 4Q21 4Q % Chg 4Q Const Curr FY Const Curr +13 % CC Fixed Income Execution $35 $13 181% 182% 96% CDS Clearing 79 48 63% 66% 61% Fixed Income Data & Analytics 274 278 (1)% —% 3% Other Data & Network Services To
Slide 7: 4Q22 Mortgage Technology Performance
4Q22 Mortgage Technology Performance in millions Revenue 4Q22 4Q21 4Q % Chg FY % Chg +10 % 4Q recurring revenue Origination Tech $172 $231 (25)% (22)% Closing Solutions 42 83 (50)% (26)% Data & Analytics 24 18 31% 24% ~66 % Other 11 14 (19)% (3)% 4Q mix of Total Revenue $249 $346 (28)% (20)% recurri
Slide 8: Record 2022 Performance & 2023 Guidance
Record 2022 Performance & Revenue 2023 Guidance ▪ FY2023 Recurring Revenues: ▪ Mortgage Tech: Mid-to-high single digits ▪ FIDS: Mid-single digits (excl. ~$15 million in millions except per share amounts related to FX and Euronext migration) ▪ Exchanges: Low-single digits (excl. ~$20 Income statement
Slide 9: Positioned for Growth Across Asset Classes
Positioned for Growth Across Asset Classes Exchanges Fixed Income & Data Services Mortgage Technology(1) Total Revenues Total Revenues Total Revenues 7% 6% CAGR CAGR 14% CAGR $ in millions $ in millions $ in millions $4,071 $2,092 $1,129 $3,307 $1,756 $771 ICE Mortgage ICE Tech Mortgage ~$1.2 Bn 201
Slide 10: Consistent Track Record of Growth
Consistent Track Record of Growth 2022 Highlights $5.30 $5.06 Record net revenues +4% y/y, CC Record recurring revenues +7% y/y, CC $4.41 Record adj. op income +6% y/y, CC Record adj. EPS +5% y/y $3.77 Record adj. free cash flow +3% y/y $3.51 $2.93 $2.76 $2.42 $1.93 $1.68 $1.50 $1.38 $1.07 $0.83 $0.
Slide 11: Appendix
Appendix 11
Slide 12: Adjusted Operating Expense
Adjusted Operating Expense Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended in millions December 31, 2022 December 31, 2021 December 31, 2022 December 31, 2021 GAAP Adjusted GAAP Adjusted GAAP Adjusted GAAP Adjusted Compensation and benefits $ 349 $ 349 $ 369 $ 369 $ 1,4
Slide 13: Adjusted Non-Operating Income/Expense Reconciliation
Adjusted Non-Operating Income/Expense Reconciliation in millions 4Q22 3Q22 2Q22 1Q22 4Q21 Other Income / (Expense) $(190) $(1,097) $23 $(58) $1,330 Less: Gain on sale of equity investments — — (41) — — Less: Gain on deconsolidation of Bakkt — — — — (1,419) Add: Net losses from and impairment of unco
Slide 14: Adjusted Effective Tax Rate Reconciliation
Adjusted Effective Tax Rate Reconciliation Three Months Three Months Twelve Months Twelve Months in millions Ended 12/31/2022 Ended 12/31/2021 Ended 12/31/2022 Ended 12/31/2021 Income before income taxes $564 $2,109 $1,808 $5,698 Income tax expense 124 580 310 1,629 Effective tax rate 22% 28% 17% 29
Slide 15: Adjusted Free Cash Flow Calculation
Adjusted Free Cash Flow Calculation Twelve Months Ended Twelve Months Ended in millions 12/31/2022 12/31/2021 Cash flow from operations $3,554 $3,123 Less: Capital expenditures and capitalized software development costs (482) (452) Add/(Less): Section 31 fees, net (166) 150 Adjusted free cash flow $
Slide 16: Adjusted EBITDA Reconciliation
Adjusted EBITDA Reconciliation Twelve Months Ended in millions 12/31/2022 Adjusted net income(1) $2,974 Add: Adjusted interest expense(1) 451 Add: Adjusted income tax expense(1) 880 Add: Adjusted depreciation and amortization(1) 421 Adjusted EBITDA $4,726 Debt, as reported $18,122 Less: BKI Deal Rel
Slide 17: ICE Summary Balance Sheet
ICE Summary Balance Sheet in millions BALANCE SHEET 12/31/2022 12/31/2021 CHANGE Assets Unrestricted Cash $1,799 $607 $1,192 ▪ $1.8B unrestricted cash Other Current Assets 155,148 153,693 1,455 Current Assets 156,947 154,300 2,647 ▪ Total debt of $18.1B; Adj. Debt-to- PPE (net) 1,767 1,699 68 EBITDA
Slide 18: Fixed Income & Data Supplemental Data
Fixed Income & Data Supplemental Data Annual Subscription Value (ASV) in millions 4Q22 3Q22 2Q22 1Q22 4Q21 ASV(1) $1,682 $1,643 $1,660 $1,665 $1,646 Adjusted for: FX — 17 1 (15) (22) ASV, CC 1,682 1,660 1,661 1,650 1,624 18 (1) ASV is defined as the annual value of subscriptions under contract for t
Slide 19: Average Daily Volume & Rate Per Contract (RPC) Trends
Average Daily Volume & Rate Per Contract (RPC) Trends lots in thousands Energy ADV & RPC Ags ADV & RPC ADV RPC ADV RPC ADV RPC ADV RPC Interest Rates ADV & RPC RPC ADV Total Financials ADV & RPC RPC 19 ADV RPC ADV RPC
Slide 20: Average Daily Volume & Open Interest (OI) Trends
Average Daily Volume & Open Interest (OI) Trends lots in thousands Energy ADV & OI Ags ADV & OI ADV OI ADV OI ADV OI ADV OI Interest Rates ADV & OI OI ADV Total Financials ADV & OI OI 20 ADV OI ADV OI
Slide 21: GAAP Results
GAAP Results INCOME STATEMENT HIGHLIGHTS GAAP GAAP GAAP GAAP in millions except per share amounts 4Q22 4Q21 % Chg 2022 2021 % Chg Net revenues $1,768 $1,840 (4)% $7,292 $7,146 2% Operating Expenses $904 $960 (6)% $3,654 $3,697 (1)% Operating Income $864 $880 (2)% $3,638 $3,449 5% Operating Margin 49
Slide 22: Adjusted Operating Income, Operating Margin & Operating Expense Reconciliation
Adjusted Operating Income, Operating Margin & Operating Expense Reconciliation Fixed Income and Data Services Mortgage Technology in millions Exchanges Segment Segment Segment Consolidated Twelve Months Ended Twelve Months Ended Twelve Months Ended Twelve Months Ended December 31, December 31, Decem
Slide 23: Adjusted Operating Income, Operating Margin & Operating Expense Reconciliation
Adjusted Operating Income, Operating Margin & Operating Expense Reconciliation Fixed Income and Data Services Mortgage Technology in millions Exchanges Segment Segment Segment Consolidated Three Months Ended Three Months Ended Three Months Ended Three Months Ended December 31, December 31, December
Slide 24: Adjusted Net Income & EPS
Adjusted Net Income & EPS Three Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended in millions except per share amounts December 31, 2022 December 31, 2021 December 31, 2022 December 31, 2021 Net income attributable to ICE $ 425 $ 1,527 $ 1,446 $ 4,058 Add: Amortization of acqui
Slide 25: Adjusted Net Income & EPS
Adjusted Net Income & EPS Twelve Months Twelve Months Twelve Months Twelve Months Twelve Months Twelve Months Twelve Months Twelve Months in millions except per share amounts Ended 12/31/20 Ended 12/31/19 Ended 12/31/18 Ended 12/31/17 Ended 12/31/16 Ended 12/31/15 Ended 12/31/14 Ended 12/31/13 Net i
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