Slide 1: First Quarter of 2014 Earnings Presentation
IntercontinentalExchange Fourth Quarter & Full YearIntercontinentalExchange Group 2013 Earnings Presentation First Quarter of 2014 Earnings Presentation February 11, 2014 May 8, 2014
Slide 2: Forward-Looking Statement and Legends
Forward-Looking Statement and Legends 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
Slide 3: Earnings Conference Call - First Quarter 2014
Earnings Conference Call - First Quarter 2014 Jeffrey C. Sprecher Chairman and Chief Executive Officer Scott A. Hill Chief Financial Officer Charles A. Vice President, Chief Operating Officer Kelly Loeffler, CFA Isabel Janci Melanie Skijus, CFA SVP, Corporate Communications, Sr. Director, Investor R
Slide 4: First Quarter 2014 Key Takeaways
First Quarter 2014 Key Takeaways ▪ Consolidated record net revenues of $932 million ◦ Record CDS clearing revenues of $26 million ◦ Record market data revenues of $133 million ◦ Record adjusted EPS of $2.60, +28% y/y ▪ Expense discipline and greater than 40% synergy realization; adjusted operating m
Slide 5: 1Q14 Financial Performance
1Q14 Financial Performance Net Revenues INCOME STATEMENT (in millions) 1Q14 1Q13 1,750 % AGR 14 Net revenues $932 $352 1,500 ' 13 C '09- Operating Expenses $523 $152 1,250 $ (Millions) Adj. Operating Expenses(1) $463 $131 +1% y/y 1,000 Operating Income $409 $200 750 (1) Adj. Operating Income $469 $2
Slide 6: 1Q14 Revenue and Expense Detail
1Q14 Revenue and Expense Detail ICE Segment Net Revenue Mix ICE Segment Adjusted Expenses(3) U.S. Cash Equities Cash Comp. CDS Listings & Benefits Non-Cash Comp. 5% 6% 10% Market Data 35% 6% Prof. Services & 13% 15% Acquisition Exp. 14% 10% Global Other 21% Tech & Derivatives 52% Deprec. & 13% Commu
Slide 7: Euronext - Well Positioned for IPO; Solid Financial Performance
Euronext - Well Positioned for IPO; Solid Financial Performance ▪ Leading pan-European equities & derivative platform with unique single order book model ▪ Strong growth in cash trading volumes, +16% y/y in 1Q14 ▪ Anticipate €60MM of expense synergies over next three years ▪ New clearing revenue par
Slide 8: ICE Derivatives - First Quarter 2014
ICE Derivatives - First Quarter 2014 ICE & Liffe Futures & Options ADV Derivatives Overview - 1Q14 8,000 -13% y/y ▪ Futures and options rev of $357MM 6,000 ◦ Brent revenue of $49MM, -15% y/y -26% y/y ◦ Nat Gas revenue of $57MM, +1% y/y (000s) 4,000 ◦ Ag & Metals revenue of $54MM, +25% y/y ◦ Interest
Slide 9: Credit Derivatives - First Quarter 2014
Credit Derivatives - First Quarter 2014 Quarterly CDS Revenue ▪ 1Q14 CDS revenues of $43MM, +30% y/y 50 +30% y/y ▪ $17MM from ICE Swap Trade & Creditex, -1% y/y 40 ▪ Record $26MM from CDS clearing, +64% y/y $ (Millions) 30 ▪ 1Q14 gross notional cleared +42% y/y 20 ▪ Through April 28, $52T in CDS cle
Slide 10: Cash Flow and Capital Structure
Cash Flow and Capital Structure Operating Cash Flow 1% 800 3 CAGR 1 '09- '1 Capital Management 700 600 +16% y/y ▪ $4.9B in total debt, 2.35x debt-to-adj. EBITDA(2) $ (Millions) 500 ▪ On April 3, we entered into a new $3B credit facility & 400 repaid $367MM term loan using our CP program 300 ▪ Clear
Slide 11: Financial Reporting
Financial Reporting ICE segment Other revenue for 1Q14 was $114 million and includes technology services revenues, trading license fees, regulatory and listed company service fees, among others. Please see next page for guidance. ▪ Clearing fees for Liffe were not included in previously reported RPC
Slide 12: Expense Synergy & Guidance Update
Expense Synergy & Guidance Update ▪ In 1Q14, achieved expense synergy run rate of over $220MM ◦ On track to achieve 70% of stated $500MM in expense synergies on a run rate basis exiting 2014 ◦ Expect to achieve 90% of expense synergies achieved on a run rate basis exiting 2015 ▪ Guidance includes Eu
Slide 13: Leadership Position in Global Energy Markets
Leadership Position in Global Energy Markets ▪ Leading global energy exchanges group ▪ Nearly $800 million annual energy revenues across execution & clearing ▪ Diversified portfolio of energy markets with different drivers and growth opportunities in every product category ▪ Over 850 new energy prod
Slide 14: Energy Benchmarks: Crude Oil & Other Oil Products
Energy Benchmarks: Crude Oil & Other Oil Products ▪ 1Q14 open interest record in Brent: 2.9MM, +16% from year-end ▪ 17-year track record of growth in global Brent benchmark driven by emerging economies and global demand for risk management ▪ Record 1Q14 refined oil ADV supports solid y/y growth: Hea
Slide 15: Energy Benchmark: Natural Gas
Energy Benchmark: Natural Gas ▪ 1Q14 ADV NA Nat Gas -16%, EU Nat Gas +64% ▪ Records in ADV and OI in benchmark European Nat Gas contracts - NBP & TTF futures ▪ Total Nat Gas OI of 22 million contracts, well above pre-crises levels and demonstrates strong underlying demand for risk management ▪ Susta
Slide 16: European Interest Rate Futures & Options
European Interest Rate Futures & Options ▪ Excluding Euribor, record quarterly interest interest rate ADV in 1Q14 ▪ Solid performance across other interest rate products; record ADV in Sterling (+37% y/y) and double digit growth in Swapnote (+32% y/y) ▪ Total interest rate OI, +21% from year-end ▪ I
Slide 17: Sterling Futures & Options
Sterling Futures & Options ▪ Growth in Sterling volumes as UK economy showed signs of improvement ▪ Record 1Q14 Sterling futures ADV of 672,000 contracts, +30% y/y ▪ Record 1Q14 Sterling options ADV of 202,000 contracts, +71% y/y ▪ Record 1Q14 OI of 9 million contracts, +87% from year-end Sterling F
Slide 18: Gilt & Swapnote
Gilt & Swapnote ▪ 1Q14 Gilt ADV was third highest quarter driven by need to hedge long-dated UK debt ▪ ICE successfully launched the 30-year Ultra Long Gilt on March 31st ▪ 1Q14 ADV of 4.4K contracts, +32% y/y; second highest quarterly ADV ▪ Liffe will launch 21 new interest rates products in 1H14;
Slide 19: Pre-eminent Trading & Listing Franchise
Pre-eminent Trading & Listing Franchise NYSE Listings - 1Q14 1Q14 Global IPO Capital Raising - Top 5 Venues by Proceeds (in billions) ▪ #1 in global IPO and follow-on proceeds ◦ Technology leadership; 67% share of 10 9 8 technology IPOs 8 6 6 ▪ More proceeds raised than any other exchange $ (Billion
Slide 20: Leadership in Evolving Market Structure
Leadership in Evolving Market Structure ICE’s strategic focus on market structure to ensure secure, efficient & transparent markets ICE Led Evolution of Derivatives Markets Opportunities in U.S. Equity Markets ▪ 2000 – Led move to electronic trading ▪ Reduce complexity Created greater market transpa
Slide 21: Integration & Strategic Initiatives Update
Integration & Strategic Initiatives Update Strategic Initiative Status Implemented quarterly dividend policy Completion of SMX/SMXCC acquisition Liffe / Euronext separation IBA assumed administration of LIBOR ; to become the administrator of ISDAFIX® Launched Liffe 30-Year Ultra Long Gilt Exited cer
Slide 22: Track Record of Consistent Growth
Track Record of Consistent Growth ▪ 30% EPS CAGR since IPO in 2005 ▪ Consistent growth trajectory driven by organic growth, strategic investment and M&A ▪ Growth and efficiency plan established for 2014 & beyond, including milestones for achievement ▪ Best positioned global exchange group, well dive
Slide 23: Appendix
APPENDIX 23 IntercontinentalExchange
Slide 24: ICE Summary Balance Sheet
ICE Summary Balance Sheet In millions BALANCE SHEET 3/31/14 12/31/13 CHANGE Assets ▪ Leverage with debt to trailing Unrestricted Cash & ST Inv $1,021 $1,035 $(14) Adjusted EBITDA(1) of 2.35x as of Other Current Assets 44,233 43,224 1,009 3/31/14 Current Assets 45,254 44,259 995 ▪ Unrestricted cash a
Slide 25: Non-GAAP Net Income Attributable to ICE & EPS Reconciliation
Non-GAAP Net Income Attributable to ICE & EPS Reconciliation In millions (except per share amounts) 12 Months 12 Months 3 Months 3 Months Ended Ended Ended 3/31/14 Ended 3/31/13 12/31/13 12/31/12 Net income attributable to ICE $262 $135 $254 $552 Add: Cetip impairment loss — — 190 — Add: NYSE Eurone
Slide 26: Non-GAAP Operating Income, Operating Margin & Operating Expense Reconciliation
Non-GAAP Operating Income, Operating Margin & Operating Expense Reconciliation In millions Consolidated Consolidated ICE Segment ICE Segment 3 Months 3 Months 3 Months 3 Months Ended 3/31/14 Ended 3/31/13 Ended 3/31/14 Ended 3/31/13 Total net revenues $932 $352 $796 $352 Total operating expenses 523
Slide 27: Adjusted Non-GAAP EBITDA Reconciliation
Adjusted Non-GAAP EBITDA Reconciliation In millions 3 Months Ended 3 Months Ended Trailing 12 Months 3/31/14 3/31/13 Ended 3/31/14 Adjusted net income attributable to ICE $301 $149 $798 Add: Income tax expense 107 54 283 Add: Income tax expense adjustment on Non-GAAP Items 21 7 32 Add (Less): Other