CME Group Inc.
) reported fourth-quarter 2013 operating earnings per share of 64
cents. Results missed the Zacks Consensus Estimate of 67 cents
but beat the year-ago quarter figure by a penny.
Consequently, operating net income inched up 1.9% year over
year to $214.3 million. Including extraordinary items, GAAP net
income stood at $193.1 million or 58 cents a share in the
reported quarter against $166.8 million or 50 cents per share in
the year-ago period.
CME Group's total revenue climbed 3.9% year over year to $687
million and also exceeded the Zacks Consensus Estimate of $685
million. Growth primarily resulted from an accretion in clearing
and transaction fees due to incremental volumes within interest
rate, energy and agricultural commodities. However, lower average
rate per contract as well as deteriorated revenues from market
data and information services along with access and communication
fees partially offset the upside.
CME Group's average daily volume jumped 11.2% year over year
to 11.33 million contracts in the reported quarter, primarily
driven by a surge of 29% in volumes from interest rate products.
However, total average rate per contract reduced 6.1% from the
year-ago quarter to 78.0 cents. Nonetheless, the volumes
constitute mostly of lower-priced products across asset-class
that require higher volume discounts.
clearing and transaction fees
rose 5.9% year over year to $576.8 million, accounting for about
84% of the total revenue. However, revenues from
and information services
decreased 3.5% to $76.5 million. Additionally, revenues from
access and communication fee
decelerated 10.7% year over year to $20.9 million, whereas
revenues reduced 5.8% year over year to $12.9 million.
Meanwhile, total operating expenses inflated 27.5% year over
year to $363.8 million. Consequently, operating income declined
14% to $323.2 million, significantly deteriorating operating
margin to 33.8% from 56.8% in the year-ago quarter.
However, CME Group recorded non-operating expenses of $16.2
million against $22.1 million in the year-ago quarter, primarily
owing to higher investment income and lower borrowing costs in
the reported quarter.
Highlights of Full-Year 2013
For full-year 2013, CME Group reported operating earnings of
$3.05 per share, which missed the Zacks Consensus Estimate of
$3.09 but surpassed $3.02 recorded per share in 2012.Reported net
income stood at $976.8 million or $2.92 per share in 2013 against
$896.3 million or $2.70 per share recorded in 2012.
Total revenue edged up 0.7% year over year to $2.94 billion in
2013, which also whiskered past the Zacks Consensus Estimate of
$2.92 billion. Total operating expenses grew 6.3% year over year
to $1.3 billion, slightly higher than management's target of
below 5% growth.
As of Dec 31, 2013, CME Group had $2.54 billion of cash and
marketable securities, higher than $1.66 billion at 2012-end,
while long-term debt stood at $2.1 billion, at par with the
As of Dec 31, 2013, CME Group had total assets of $54.28
billion (up from $38.86 billion as of Dec 31, 2012), while total
equity stood at $21.16 billion (down from $21.42 billion as of
Dec 31, 2012). The company did not repurchase shares during the
On Dec 11, 2013, the board of CME Group declared an annual
variable dividend of $2.60 per share, which was paid on Jan 14,
2014, to shareholders of record as on Dec 27, 2013.
The dividend was worth more than $872 million, significantly
higher than about $199 million of variable dividend paid for the
first time in 2012. Including the regular dividends, a total of
about $2.7 billion was paid in dividends since the beginning of
On Dec 26, 2013, CME Group paid a regular dividend of 45 cents
per share for the fourth quarter to shareholders of record as on
Along with CME Group,
American Express Co.
Financial Engines Inc.
) bear a Zacks Rank #2 (Buy) in the financial sector.
AMER EXPRESS CO (AXP): Free Stock Analysis
CME GROUP INC (CME): Free Stock Analysis
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