IntercontinentalExchange Q3 Profit Surges, Beats Estimates

(RTTNews) - Global markets operator IntercontinentalExchange Inc. (ICE) on Tuesday reported a 46 percent increase in profit for the third quarter from last year on higher revenues that reflect the company's acquisition of NYSE Euronext. Adjusted earnings per share for the quarter beat analysts' estimates.

In a separate statement, ICE said it plans to commence operations at ICE Futures Singapore and ICE Clear Singapore on March 17, 2015.

Atlanta, Georgia-based ICE completed its multi-billion-dollar acquisition of NYSE Euronext during the fourth quarter of 2013.

Jeffrey Sprecher, chairman and CEO of ICE said, "In the third quarter, we grew earnings while integrating the NYSE Liffe operations and announcing strategic investments in SuperDerivatives and the Holland Clearing House, which will accelerate our growth initiatives related to risk management and data services. We have seamlessly transitioned most of Liffe's markets to ICE's futures exchanges and NYSE achieved a quarterly record in initial public offerings and capital raising."

For the third quarter, net income attributable to ICE was $206 million, up from $141 million in the same period last year. However, earnings per share declined to $1.80 from $1.92 in the prior-year quarter on higher number of weighted average common shares outstanding in the latest quarter.

The latest quarter's results include NYSE integration costs of $38 million and the related tax impact.

Excluding items, adjusted net income from continuing operations for the latest quarter were $2.15 per share, compared to $1.97 per share in the year-ago period.

On average, 16 analysts polled by Thomson Reuters expected the company to report earnings of $2.01 per share for the quarter. Analysts' estimates typically exclude special items.

Total revenue, less transaction-based expenses, more than doubled to $745 million from $338 million in the prior year. This includes net transaction and clearing revenues, less transaction-based expenses, of $447 million. Analysts' revenue consensus was $743.92 million for the quarter.

Transaction and clearing revenues for the quarter more than doubled from the year-ago period to $708 million. Market data fees also more than doubled from the year-ago period to $105 million. Listings revenues for the quarter were $86 million.

Consolidated other revenues, which include technology services revenues, trading license fees, regulatory fees and listed company service fees, surged almost six-fold from last year to $107 million.

ICE declared a quarterly cash dividend of $0.65 per share for the fourth quarter of 2014, payable on December 31, to shareholders on record December 16. The ex-dividend date will be December 12, 2014.

Looking ahead, ICE expects operating expenses for the fourth quarter in a range of $390 million to $395 million, including amortization of acquisition-related intangibles. Excluding this, the company forecasts operating expenses of $344 million to $349 million.

For fiscal 2014, ICE projects operating expenses, excluding amortization of acquisition-related intangibles, in a range of $1.39 billion to $1.40 billion. Earlier, the company projected operating expenses of $1.55 billion to $1.56 billion, net of acquisition-related transaction and integration costs for all periods.

The company expects to realize $265 million in synergies by the end of 2014, representing nearly 50 percent of its total target. The company had forecast expense synergies of $550 million exiting 2016.

ICE said that it will announce shortly the listed and cleared products at ICE Futures Singapore as well as ICE Clear Singapore.

Following the acquisition of the Singapore Mercantile Exchange and Singapore Mercantile Exchange Clearing Corporation in November 2013, ICE retained both licenses to operate as an approved exchange and an approved clearing house respectively.

The Asian hub for ICE will be co-headed by Jennifer Ilkiw, ICE Vice President for the Asia Pacific region, and Lucas Schmeddes, president and chief operating officer of ICE Futures Singapore and ICE Clear Singapore.

ICE closed Monday's trading at $209.79. In Tuesday's pre-market activity, the stock is up $1.21 or 0.58 percent to $211.00.