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Euronext achieved a strong performance in 2018

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Euronext achieved a strong performance in 2018

EURONEXTEURONEXT Euronext NL0006294274, NL0006294274
RELEASE 14 FEB 2019 17:45 CET
Euronext achieved a strong performance in 2018
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EURONEXT ACHIEVED A STRONG PERFORMANCE IN 2018
ACHIEVEMENT OF MOST OF 2019 TARGETS ONE YEAR IN ADVANCE AND SUCCESSFUL INTEGRATION OF HIGHLY ACCRETIVE ACQUISITIONS. 2019 COST TARGET ANNOUNCED

Amsterdam, Brussels, Dublin, Lisbon, London and Paris - 14 February 2019 - Euronext, the leading pan-European exchange in the Eurozone with 1,300 listed issuers, today announces its results for the full year 2018.

Strong increase of Euronext performance through 2018

  • Double digit growth in full year 2018 revenue to EUR615.0 million (+15.5%[1]), driven by:
    • Improved Group revenue diversification initiatives with contributions from Euronext Dublin of EUR24.6 million for 9 months of consolidation, FastMatch of EUR21.7 million and selected growth initiatives of EUR17.6 million
    • Listing revenue at EUR106.5 million (+26.4%) driven by the consolidation of Euronext Dublin and good performance of Corporate Services (EUR16.6 million)
    • Strong cash trading revenue of EUR210.9 million (+10.9%), through enhanced market share to 66.1% in 2018 (+1.7pts), effective yield management at 0.51bps (+4.9%), and improved volumes (Cash ADV at EUR8.1bn, +5.7%)
    • Strong performance of Advanced Data Services[2] with revenue at EUR118.3 million (+13.0%)
    • Non-volume related revenue accounted for 44% of total revenue in 2018, and covered 104% of operating expenses excluding D&A
  • Double digit growth in full year 2018 EBITDA to EUR354.3 million (+19.0%), with EBITDA margin at 57.6% (+1.7pts) in a year of consolidation of recent acquisitions and delivery of major steps of Optiq® trading platform:
    • Decrease of core business costs (-4.3%) thanks to costs discipline and with significant savings generated by the successful delivery of Optiq® for cash markets
    • Group operating costs (excluding D&A) up (+11.2%) mainly impacted by the consolidation of Euronext Dublin and FastMatch, and related one-off costs
  • Double digit growth in full year 2018 adjusted EPS at EUR3.44[3] (+11.2%). Decrease in EPS (basic) to EUR3.10 (-10.5%), because of negative comparison base in 2017 with one-off capital gain from LCH SA share swap and non-recurring tax release:
    • Net income, reported, share of the Group, at EUR216.0 million driven by strong operating performance, while impacted by EUR21.5 million of exceptional items and by EUR5.3 million of net financing expenses
  • In accordance with Euronext dividend policy, a pay-out ratio of 50% of reported net income representing a dividend for 2018 of EUR108 million (EUR1.54 per share) will be proposed to the AGM[4] on 16 May 2019. As a reminder, dividend for 2017 was positively impacted by significant one-off such as capital gain from LCH SA share swap and non-recurring tax release
Key figures - in EURm, unless stated otherwise, unaudited FY 2018 FY 2017 % var
Revenue 615.0 532.3 +15.5%
Operational expenses excluding D&A -260.8 -234.5 +11.2%
EBITDA 354.3 297.8 +19.0%
EBITDA margin 57.6% 55.9% +1.7 pts
Net income, share of the Group 216.0 241.3 -10.5%
EPS (adjusted)2   3.44    3.09  +11.2%

Achievement of most of 2019 targets of Agility for Growth strategic plan one year in advance, confirming Q3 2018 momentum

  • "Deliver value to shareholders":
    • 2018 core business and selected growth initiatives (excluding clearing) EBITDA margin at 61.6%, reaching one year in advance the 61-63% 2019 EBITDA margin target
    • ~EUR340 million of capital deployed in revenue diversification and expansion of Euronext decentralised model
    • ~EUR100 million of capital deployed in bolt-on deals, in the initial EUR100-150 million envelope
    • Euronext rated A (outlook stable) by S&P, in line with expected investment grade profile
  •  "Enhance agility":
    • 2019 cost reduction target achieved one year in advance with EUR23.8 million of cumulated core business gross savings achieved since Q2 2016 (vs. EUR22 million targeted) thanks to continued cost discipline, with less than half of expected restructuring costs incurred (EUR14.6 million vs. EUR33 million targeted)
    • Optiq® trading platform delivered in 2017 for Market Data, 2018 for Cash markets, February 2019 for Euronext Dublin and planned by the end of 2019 for Derivatives markets
  • "Strengthen resilience of the core business":
    • Continued core business revenue growth: +2.0% CAGR2015-2018 vs. 2.0% CAGR2015-2019 targeted
    • Increased market share on cash trading to 65% on average since 2017 (vs. >60% targeted) and >50% on French equity options (vs >50% targeted), and sustained yield on cash trading
  • "Grow in selected segments": EUR17.6 million incremental revenue in 2018 vs. EUR55 million targeted in 2019. Corporate Services recorded strong performance and the Tech SMEs initiative achieved good traction. ETF MTF is expected to be live in 2019. Other initiatives are not expected to provide further revenue in 2019. Euronext will continue the development of innovative projects and organic initiatives
  • "Create optionality in clearing" with investment in EuroCCP in 2016 and the renewed 10-year agreement with LCH SA along with a 11.1% equity stake and a strong pre-emption right in 2017. Preferred user choice model for equity clearing is now live

Continued business diversification through highly accretive acquisitions

  • Euronext Dublin contributed EUR24.6 million to Group revenue, for 9 months of consolidation, and ran a successful integration process with merged cross-border teams and administration systems. EUR2.7 million synergies were extracted in 2018
  • FastMatch reported a strong performance contributing EUR21.7 million revenue in 2018 with a renewed management

Contemplated acquisitions of Oslo Børs VPS

On 14 January 2019, Euronext launched an all-cash tender offer to acquire all issued and outstanding shares of Oslo Børs VPS Holding ASA ("Oslo Børs VPS"). The original offer price of NOK145 per share, ie NOK6.24 billion (EUR625 million[5]) for all outstanding shares of Oslo Børs VPS, has been amended to NOK158 per share, ie. NOK6.79 billion (EUR695 million[6]) on 11 February 2019 and the acceptance period will expire on 11 March 2019 and can be extended as appropriate. The offer remains subject to conditions presented in the offer document[7] and in the press release published on 11 February 20193. This transaction would follow Euronext`s recent acquisition of Euronext Dublin (formerly the Irish Stock Exchange) and would represent another key milestone in the delivery of the group`s vision to build a consistent pan-European marketplace offering best-in-class capital markets services.

Cost guidance for 2019

In 2018, Euronext has extended its scope of activity both organically and through acquisitions. Furthermore, most of the core business 2019 targets of the Agility for Growth plan have been achieved one year in advance. To simplify and improve the tracking of its performance, Euronext will now report only group performance (including selected growth initiatives and new perimeter). New mid-term targets will be presented in H2 2019 as a part of the new strategic plan. In 2019, Euronext expects to limit the growth rate of its operating costs to a low single digit[8], despite the consolidation of Euronext Dublin for the full year of 2019[9].

Stéphane Boujnah, Chief Executive Officer and Chairman of the Managing Board of Euronext, said:

"Euronext delivered a strong financial performance in 2018 with double digit growth in revenue, EBITDA and adjusted EPS thanks to strengthened core business and market share on cash trading at 66%. Combined with efforts on cost, Euronext was able to reach most of its 2019 targets one year in advance, confirming the Q3 2018 momentum, with a core business and selected growth initiatives EBITDA margin reaching 61.6%. In 2018, Euronext successfully welcomed Euronext Dublin teams within the Group and achieved the migration of Irish markets to Optiq trading platform early February 2019, seven months after its transition for the Group cash markets. Euronext is pursuing its European strategy with the project to acquire Oslo Børs VPS, to reach another milestone in its value creation strategy and to fulfill its mission to finance the real economy in Europe. The Group is committed to deploy its capital and to analyze further acquisitions to expand its decentralized model in Europe and diversify its revenue profile.

Euronext Group has transformed itself in the past three years, with a top line growing by around EUR100m thanks to combined organic and external growth. In order to fully reflect the new Group, and given that most of the 2019 announced core business targets were met one year in advance, Euronext provides a costs guidance for 2019, prior to the release of its new strategic plan later this year, that will better help our stakeholders to assess its performance. For 2019, Euronext expects a low-single digit growth of Group operating expenses (excluding D&A) compared to 2018, thanks to its continued strong cost discipline."



Euronext full-year and Q4 2018 financial performance

In EURm, unless stated otherwise, unaudited FY 2018 FY 2017 % change Q4 2018 Q4 2017 % change
Revenue 615.0 532.3 +15.5% 157.3 139.7 +12.6%
Operational expenses excluding D&A -260.8 -234.5 +11.2% -70.4 -61.0 +15.3%
Salaries and employee benefits -118.5 -104.4 +13.5% -33.4 -28.8 +16.0%
Other expenses -142.3 -130.1 +9.3% -37.0 -32.2 +14.8%
EBITDA 354.3 297.8 +19.0% 86.9 78.7 +10.5%
EBITDA margin 57.6% 55.9% +1.7 pts 55.3% 56.3% -1.1 pt
Depreciation & Amortisation -23.4 -16.9 +38.2% -6.1 -6.3 -2.5%
Operating Profit before Exceptional items 330.9 280.8 +17.8% 80.8 72.3 +11.6%
Exceptional items -21.5 -14.8 +45.2% -5.5 -0.6 N/A
Operating Profit 309.4 266.1 +16.3% 75.3 71.7 +5.0%
Net financing income / (expense) -5.3 -3.6 +46.1% -4.0 -1.6 N/A
Results from equity investments 7.6 48.6 -84.4% -0.2 42.1 -N/A
Profit before income tax 311.7 311.1 +0.2% 71.1 112.2 -36.6%
Income tax expense -94.1 -68.9 +36.6% -21.1 -6.9 N/A
Share of non-controlling interests -1.7 -0.9 +86.2% -0.4 -0.2 N/A
Profit for the period 216.0 241.3 -10.5% 49.6 105.1 -52.8%
Reported EPS (EUR per share) 3.10  3.47 -10.5% 0.71  1.51 -52.8%
Adjusted EPS  (EUR per share) 3.44  3.09  +11.2% 0.81  0.97  -16.6%

Full-year 2018

For the year 2018, Euronext consolidated revenue increased to EUR615.0 million, up +15.5%, driven by i/ the consolidation of Euronext Dublin from Q2 2018 and of FastMatch, ii/ incremental revenue from selected growth initiatives,  iii/ strong performance across core activities and iv/ strengthened revenue capture in cash trading.

Non-volume related revenue[10] amounted to 44% of total Group revenue in 2018, stable compared to 2017. The operating cost coverage ratio[11] was 104% for 2018, compared to 100% for 2017.

Operational expenses excluding Depreciation & Amortisation increased to EUR260.8 million, up +11.2%, mainly due to the continued roll-out of selected growth initiatives and the consolidation of Euronext Dublin (from Q2 2018), while core business costs are down -4.3%.

At the end of 2018, EUR23.8 million of cumulated cost savings had been achieved since 1 April 2016, exceeding the initial 2019 gross costs reduction target of EUR22.0 million.

During 2018, selected growth initiatives of Agility for Growth strategic plan generated EUR17.6 million of revenue, mainly driven by Corporate services, and EUR16.3 million of costs (excluding D&A).

EBITDA for the 2018 year was EUR354.3 million, up +19.0%, representing a margin of 57.6%, up +1.7 points compared to 2017.

EBITDA margin for core business and selected growth initiatives, excluding clearing and new perimeter, reached 61.6% in 2018, in line with the initial 2019 target range of between 61% and 63%.

Excluding the impact of the consolidation of FastMatch and Euronext Dublin[12], Euronext consolidated revenue would have amounted to EUR568.7 million in 2018, up +8.3%, with an EBITDA margin of 60.4%, up +4.1pts compared to 2017.

Depreciation and Amortisation accounted for EUR23.4 million in 2018, up +38.2%, due to the consolidation of acquisitions and  the impact of PPA[13], accounting for EUR7.4 million in 2018.

As a consequence of the above items, operating profit before exceptional items was EUR330.9 million, a +17.8% increase compared to 2017.

EUR21.5 million of exceptional costs were booked in 2018 compared to EUR14.8 million in 2017, resulting mainly from contracts terminations, including the agreement for the early termination of the trading services contract provided by Deutsche Börse AG to the Irish Stock Exchange (now operating as Euronext Dublin), restructuring, settlement and advisory costs and impairments.

Net financing expense for 2018 was EUR5.3 million compared to a net financing expense of EUR3.6 million in 2017. This increase reflects the revaluation of some earn-outs.

Results from equity investment amounted to EUR7.6 million in 2018, mainly accounting for dividends received from Euroclear and Sicovam, as well as the contribution from LCH SA, of which Euronext owns an 11.1% stake since 29 December 2017. In 2017,
EUR48.6 million of results from equity investment were reported, mainly due to the one-off capital gain related to the LCH share swap, for EUR40.5 million.

For the year 2018, income tax was EUR94.1 million, representing an effective tax rate for the year of 30.2% (FY 2017: EUR68.9 million and 22.1%). As a reminder, income tax was impacted in 2017 by the non-recurring release of tax provisions for EUR20.4 million in Q4 2017, as a result of the lapse of statute of limitations.

Share of non-controlling interests mainly relating to FastMatch (97% owned), Skope[14] (60% owned), InsiderLog (80% owned) and Company Webcast (51% owned) amounted to EUR1.7 million in 2018.

As a result of the negative comparison base of 2017, the reported net profit share of the Group for 2018 decreased by -10.5%, to EUR216.0 million. This represents a reported EPS of EUR3.10 basic and EUR3.09 fully diluted in 2018, compared to EUR3.47 basic and EUR3.45 fully diluted in 2017. The number of shares used for the basic calculation was 69,590,114 and for the fully diluted calculation was 69,860,310.

Adjusted[15] EPS is up 11.2% in 2018, at EUR3.44, compared to EUR3.09 in 2017.

As of 31 December 2018, the Company had cash and cash equivalents of EUR398 million, and EUR509 million of financial debt. Euronext gross debt / EBITDA ratio amounted to 1.44 at the end of December 2018. In 2018, Euronext generated a net cash flow from operating activities of EUR223.5 million, compared to EUR207.0 million in 2017.

Fourth quarter of 2018

For the fourth quarter of 2018, Euronext consolidated revenue increased to EUR157.3 million, up +12.6%, driven by the consolidation of Euronext Dublin, incremental revenue from selected growth initiatives, strong performance across trading activities and strengthened revenue capture.

Non-volume related revenue[16] amounted to 45% of total Group revenue in Q4 2018, stable vs. Q4 2017. The operating cost coverage ratio[17] was 101% in Q4 2018, compared to 102% in Q4 2017.

Operational expenses excluding Depreciation & Amortisation increased to EUR70.4 million, up +15.3%, mainly due to the continued roll-out of selected growth initiatives and the consolidation of Euronext Dublin  (from Q2 2018). Core business costs are slightly up +2.0%.

During Q4 2018, selected growth initiatives of Agility for Growth strategic plan generated EUR5.4 million of revenue, mainly driven by Corporate services, and EUR5.0 million of costs (excluding D&A).

EBITDA for the quarter was EUR86.9 million, up +10.5%, representing a margin of 55.3%, down -1.1 points compared to Q4 2017.

EBITDA margin for core business and selected growth initiatives, excluding clearing and new perimeter, reached 60.1% in Q4 2018 and 61.6% over the last twelve months.

Excluding the impact of the consolidation of FastMatch and Euronext Dublin[18], Euronext consolidated revenue would have amounted to EUR143.6 million in Q4 2018, up +6.1%, with an EBITDA margin of 59.0%, up +1.5pts compared to Q4 2017.

Depreciation and Amortisation accounted for EUR6.1 million in Q4 2018, down -2.5%, due to a decrease in core business depreciations and amortisation, partially offset by the impact of PPA[19] for EUR2.0 million in Q4 2018.

Operating profit before exceptional items was EUR80.8 million, a +11.6% increase compared to Q4 2017.

EUR5.5 million of exceptional costs were booked in Q4 2018 compared to EUR0.6 million in Q4 2017, resulting mainly from contract termination, settlement and restructuring costs  and impairments.

Net financing expense for Q4 2018 was EUR4.0 million compared to a net financing expense of EUR1.6 million in Q4 2017. This increase reflects the revaluation of some earn-outs.

Results from equity investment amounted to -EUR0.2 million in Q4 2018, as the contribution from LCH SA of which Euronext owns an 11.1% stake since 29 December 2017, and the dividend received from Sicovam, for EUR1.6 million in Q4 2018, are offset by impairments. In Q4 2017, EUR42.1 million of results from equity investment were reported, mainly due to the one-off capital gain related to the LCH share swap.

Income tax for Q4 2018 was EUR21.1 million, representing an effective tax rate for the quarter of 29.7% (Q4 2017: EUR6.9 million and 6.2%, positively impacted by a tax release (see above)).

Share of non-controlling interests mainly relating to FastMatch (97% owned), Skope[20] (60% owned), InsiderLog (80% owned) and Company Webcast (51% owned) amounted to EUR0.4 million in Q4 2018.

As a result of those one off items in Q4 2017, the reported net profit share of the Group for Q4 2018 decreased by -52.8%, to EUR49.6 million. This represents a reported EPS of EUR0.71 basic and EUR0.71 fully diluted in Q4 2018, compared to EUR1.51 basic and EUR1.50 fully diluted in Q4 2017. The number of shares used for the basic calculation was 69,590,114 and for the fully diluted calculation was 69,860,310.

Adjusted EPS is down -16.6% in Q4 2018, at EUR0.81, compared to EUR0.97 in Q4 2017.

In Q4 2018 Euronext generated a net cash flow from operating activities of EUR55.4 million, compared to EUR52.4 million in Q4 2017.

Full-year and Q4 2018 business highlights

  • Listing
In EURm, unless stated otherwise FY 2018 FY 2017 % change Q4 2018 Q4 2017 % change
Listing revenue 106.5 84.2 +26.4% 29.5 21.6 +36.2%
Equity            
Annual fees 23.7 22.8 +4.1% 5.9 5.7 +3.8%
Follow-ons 18.4 21.5 -14.4% 4.8 5.1 -6.5%
IPOs 10.6 7.8 +35.5% 2.9 0.8 N/A
Debts 20.1 6.8 N/A 6.2 1.5 N/A
ETFs, Funds & Warrants 12.6 10.6 +18.7% 3.5 2.8 +23.5%
Corporate Services 16.6 9.1 +82.4% 5.2 4.3 +19.9%
Others 4.4 5.6 -21.8% 1.1 1.5 -24.1%
Money raised[21] 1,000,308 789,435 +26.7% 334,147 136,629 x 2.4

Full-year 2018

Listing revenue was EUR106.5 million in 2018, an increase of 26.4% compared to 2017. This good performance was driven by the integration of Euronext Dublin (+EUR16.7 million) from Q2 2018 and incremental revenue from Corporate services (+EUR7.5 million).

Primary equity issues activity was impacted by market volatility over 2018 and reduced investors` appetite. However, Euronext value proposition notably attracted flagship innovative companies, such as Adyen and Neoen, for their listings. Euronext also welcomed on its markets listings of family businesses, such as Roche Bobois, and Tech SMEs, such as Acacia Pharma or Media Lab. In 2018, Euronext recorded 33 new listings, including 27 SME deals, compared to 29 listings (of which 18 SME deals) in 2017. This translated into EUR3.6bn raised in 2018, compared to EUR4.2bn last year.

Activity on the secondary market was stable in 2018 vs. 2017, supported by SME projects raising financing for their development as well as large M&A activities in Europe, including the Unibail-Rodamco-Westfield, Worldline-SIX and Essilor-Luxottica deals. Over 2018, EUR60.7bn were raised in secondary equity issues, compared to EUR62.3bn[22] in 2017.

In total, EUR1.0 trillion in equity and debt were raised on Euronext`s markets in 2018, compared to EUR789.4 billion in  2017.

Corporate services generated EUR16.6 million in revenue in 2018, compared to EUR9.1 million in 2017.

Fourth quarter of 2018

Listing revenue was EUR29.5 million in Q4 2018, an increase of 36.2% compared to Q4 2017. This good performance was driven by the integration of Euronext Dublin (+EUR5.6 million) and incremental revenue from Corporate services (+EUR0.9 million).

Primary equity issues activity improved in Q4 2018, despite tough market conditions, with notably two large capitalization  deals, Shurgard and Neoen. During the fourth quarter of 2018, Euronext welcomed 9 new listings on its markets, including 7 SME deals, compared to 8 listings in the fourth quarter of 2017. This translated into EUR1.3bn raised in Q4 2018, an increase from EUR1.2bn last year.

Activity on the secondary market increased, marking a 10-year quarterly record in money raised, with EUR34bn raised in secondary equity issues, mainly through the previously mentioned Worldline-SIX and Essilor-Luxottica deals. In Q4 2017, EUR10bn were raised in secondary equity issues.

In total, EUR334.1 billion in equity and debt were raised on Euronext`s markets in Q4 2018, compared to EUR136.7 billion in Q4 2017.

Corporate services generated EUR5.2 million in revenue in Q4 2018, compared to EUR4.3 million in Q4 2017.

  • Trading
In EURm, unless stated otherwise FY 2018 FY 2017 % change Q4 2018 Q4 2017 % change
Trading revenue 276.6 237.9 +16.3% 69.8 63.1 +10.6%
Cash trading 210.9 190.3 +10.9% 52.8 48.8 +8.2%
ADV Cash market[23] 8,109 7,671 +5.7% 8,102 7,896 +2.6%
Derivatives trading 43.9 40.3 +8.9% 11.4 9.9 +15.2%
ADV Derivatives market (in lots) 585,310 550,106 +6.4% 602,328 555,047 +8.5%
Number of trading days 255 255   64 63  
Spot FX trading 21.7 7.24  n/a 5.5 4.4  +26.8%
  ADV spot FX Market (in USDm) 20,139 18,420 +9.3% 19,540 17,183 +13.7%
Number of trading days 259 258   65 64  

Full-year 2018

Cash trading

Average daily volume for cash trading increased to EUR8.1 billion in 2018, up +5.7% compared to 2017. With volumes supported by volatility peaks through the year, and thanks to effective yield management, cash trading revenue increased by +10.9% in 2018, to a total of EUR210.9 million, thanks to an average yield over the year of 0.51bps, up +4.9% compared to 2017.

Euronext strengthened its cash trading market share throughout 2018, averaging 66.1% in 2018, compared to 64.4% in 2017.

The average daily transaction value of ETFs on the electronic order book[24] was EUR266 million over 2018, up +7.0% compared to 2017, supported by market volatility. The total number of ETFs listed on Euronext was 1,150 at the end of December 2018.

Derivatives trading

Derivatives trading revenue increased in 2018, to EUR43.9 million, compared to EUR40.3 million in 2017. Average daily volume on individual equity derivatives was up +7.4% at 297,012 contracts, while the average daily volume on equity index derivatives was up +4.1% to 231,107 contracts.

Commodity products recorded increasing average daily volumes in 2018, up +10.8% to 57,191 contracts.

Yield on derivatives averaged 0.29bps in 2018, stable compared to 2017.

Spot FX trading

Spot FX trading activity on FastMatch`s spot foreign exchange market recorded average daily volumes of $20.1 billion, up +9.3% compared to 2017, supported by markets volatility through the year. As a result, spot FX trading generated EUR21.7 million of revenue in 2018. In 2017, spot FX trading generated EUR7.2 million of revenue for 4.6 months of consolidation.

Fourth quarter of 2018

Cash trading

Average daily volume for cash trading increased at EUR8.1 billion in Q4 2018, up +2.6% compared to Q4 2017. In an improved environment, cash trading revenue increased by +8.2% in Q4 2018, to a total of EUR52.8 million, thanks to an average yield over the quarter of 0.51bps, up +1.1% compared to Q4 2017.

Cash trading market share throughout the fourth quarter of 2018 averaged 66.4% in Q4 2018, compared to 67.1% in Q4 2017.

The average daily transaction value of ETFs on the electronic order book1 was EUR263 million over Q4 2018, up +8.6% compared to Q4 2017, supported by a rebound of volatility. The total number of ETFs listed on Euronext was 1,150 at the end of December 2018.

Derivatives trading

Derivatives trading revenue increased in Q4 2018, to EUR11.4 million, compared to EUR9.9 million in Q4 2017. Average daily volume on individual equity derivatives was stable at 297,994 contracts, while the average daily volume on equity index derivatives was up +24.7% to 259,333 contracts.

Commodity products recorded slightly declining average daily volumes in Q4 2018, down -3.7% to 45,001 contracts.

Yield on derivatives averaged 0.30bps in Q4 2018, an increase from 0.28bps in Q4 2017.

Spot FX trading

Spot FX trading activity on FastMatch`s spot foreign exchange market recorded average daily volumes of $19.5 billion, up +13.7% compared to Q4 2017, supported by continuing markets volatility. As a result, spot FX trading generated EUR5.5 million of revenue in Q4 2018, up +26.8% compared to Q4 2017.

  • Advanced Data Services[25]

Full-year 2018

Advanced Data Services reported a strong 2018 performance, with revenue up +13.0% to EUR118.3 million in 2018, resulting from new market data agreements, good traction from indices business, and reflecting the consolidation of Euronext Dublin activities.

Fourth quarter of 2018

Advanced Data Services recorded good growth, with revenue up +7.6% to EUR29.8 million in Q4 2018, as a result of new market data agreements and of the consolidation of Euronext Dublin activities.

  • Post-Trade

Full-year 2018

Clearing

Clearing revenue increased in 2018, to EUR55.3 million, +8.2% compared to 2017, reflecting a dynamic commodities activity during the year, and higher treasury income.

Custody, Settlement and other post-trade

Revenue from Interbolsa in Portugal and other post trade activities increased by +7.2%, to EUR22.1 million in 2018, driven by an increase in equities and public debt under custody and settlement activity compared to 2017.

Fourth quarter of 2018

Clearing

Clearing revenue was stable in Q4 2018, at EUR13.4 million, +1.0% compared to Q4 2018, reflecting a slower commodities activity, and stable treasury income.

Custody, Settlement and other post-trade

Revenue from Interbolsa in Portugal and other post trade activities increased by +3.5%, to EUR5.5 million in Q4 2018, driven by an increase in public debt under custody and settlement activity compared to Q4 2017.

  • Euronext Technologies[26]  & Other revenue

Full-year 2018

Euronext Technologies & Other revenue increased by +7.8% in 2018, to EUR36.1 million as the activity continued to benefit from Optiq® project work on commercial releases for international clients,  as well as an increased activity in Managed Services solutions and in SFTI/Colocation services.

Fourth quarter of 2018

Euronext Technologies & Other revenue increased by +8.1% in Q4 2018, to EUR9.2 million as the activity continued to benefit from Optiq® project work on commercial releases for international clients as well as an increased activity in Managed Services solutions.



Corporate highlights of Q4 2018, since publication of Q3 2018 results on 12 November 2018

  • Contemplated acquisition of Oslo Børs VPS announcement in 2018

Please refer to the paragraph "Corporate highlights since 31 December 2018"

  • Acquisition of Commcise

On 20 December 2018, Euronext announced the acquisition of 78% of the capital of Commcise, a Software as a Service ("SaaS") provider of award-winning research evaluation and commission management solutions for financial services firms, from its founders for an initial cash consideration of £27 million.

Founded in 2013 and headquartered in London, with offices in New York and Bangalore, Commcise offers a unique cloud-based research commission management, evaluation and accounting solution built to meet the needs of asset managers, brokers and independent research providers.

Commcise is the only vendor which combines research funding, consumption and accounting into a single fully integrated platform. Commcise currently offers  three products:

  • CommciseBUY provides asset managers with a cloud-hosted  platform to manage their research funding and associated cost allocation (irrespective of whether its paid through trading, direct charge to clients or P&L), automated trade reconciliation, resource consumption tracking, contract management, research accounting, as well as flexible reporting tools to improve transparency in line with MiFID II regulation;
  • CommciseSELL is a cloud-hosted platform for broker-dealers and research providers covering commission management and service pricing;
  • CommciseRP is a service pricing and client profitability tool designed to meet the specific needs of independent research providers.

Commcise`s revenue model is based on recurring software licence fees with a high level of contract renewals driven by the quality of its product and its attention to industry needs. At the end of September 2018, Annual Contract Value (ACV) stood at £3.7 million, more than 6 times the ACV generated in 2016.

Already servicing more than 500 customers including some of the world`s largest asset managers, brokers and research providers across Europe, the US and Asia, Commcise`s growth potential is significant both through new targeted clients and cross selling opportunities with existing customers, driven by a strong product pipeline, and the overall market trend for more transparency in research spend. Commcise benefits from regulatory trends led by the enforcement of MiFID II on execution and research unbundling and research valuation, which is driving asset managers to take ownership of their research management process.

The acquisition of Commcise reinforces the deployment of the Agility for Growth strategic plan, announced in May 2016, creating more value for Euronext clients, asset managers and broker-dealers by addressing a strong need generated by MiFID II regulation. This investment fits into the EUR100-150 million envelope allocated for bolt-on acquisitions and is consistent with Euronext`s disciplined M&A strategy.

The complete founding team of Commcise will remain in place, continuing to grow the business while benefiting from Euronext`s reach and expertise with asset managers and  broker dealers with mid-term liquidity mechanisms.

  • Appointment of Nicolas Rivard as Head of Advanced Data Services

Nicolas Rivard, previously Chief Innovation Officer, has been appointed Head of Advanced Data Services, reporting to Chris Topple, CEO of London and Global Head of Sales. Euronext has strong ambitions for the growth of its broad data management and index segment which has become central to the exchange industry both from an economic and regulatory standpoint. Nicolas Rivard is charged with bringing together Euronext`s broad data capabilities to drive a new strategy that will better organise and monetise its ever increasing dataset and accelerate growth of Euronext index franchise. He will leverage innovation and new technology development to deliver value to our clients and partners.

  • Volumes in Q4 2018

For the fourth quarter of 2018, the average daily transaction value on the Euronext cash order book stood at EUR8,102 million, up +2.6% compared to the same period last year.

The average daily transaction value of ETFs on the electronic order book[27] was EUR263 million over Q4 2018, up +8.6% compared to Q4 2017. The total number of ETFs listed on Euronext was 1,150 at end of December 2018.

The overall average daily volume on Euronext derivatives stood at 602,328 contracts (+8.5% compared to the fourth quarter of 2017) and the open interest was 14,645,289 contracts at the end of December 2018 (-0.5% compared to the end of December 2017).

The average daily volume on FastMatch`s spot foreign exchange market stood at $19,540 million in Q4 2018, up +13.7% compared to the same period last year.

Corporate highlights since 31 December 2018

  • Launch of Euronext cash tender offer for Oslo Børs VPS

On 24 December 2018, Euronext announced it had approached the Board of Directors of Oslo Børs VPS Holding ASA ("Oslo Børs VPS")  to seek its support for a EUR625m cash tender offer for all the outstanding shares of Oslo Børs VPS, the Norwegian Stock Exchange and national CSD operator, headquartered in Oslo. On 14 January 2019, Euronext published the offer document for its previously announced all-cash tender offer to acquire all issued and outstanding shares of Oslo Børs VPS for NOK 6.24 billion (EUR625m[28]). The offer document is available on Euronext`s website, www.euronext.com[29].

Following an invitation to consider an acquisition of shares in Oslo Børs VPS organized by a group of its shareholders, Euronext has already secured support for the offer from Oslo Børs VPS shareholders representing 50.5% of the total number of outstanding shares through irrevocable binding pre-commitments to tender shares in the context of the offer (45.2%), and share purchases (5.3%). These irrevocable undertakings remain valid regardless of any competing offer that has been or may be made in the context of this transaction until 31 August 2019. In addition, 22 shareholders decided to strengthen their commitment to support Euronext`s Offer by extending the deadline for their irrevocable pre-commitments to the end of December 2019. Together with Euronext, as of 11 February 2019, these shareholders already represent around 38% of the share capital.

The original offer price of NOK145 per share, ie NOK6.24 billion (EUR625m[30]) for all outstanding shares of Oslo Børs VPS, has been amended to NOK158 per share, ie. NOK6.79 billion (EUR695 million[31]) on 11 February 2019, in order to demonstrate its willingness to share the benefits of this transaction with Oslo Børs VPS shareholders, the majority of whom supports Euronext`s offer and to continue the dialogue with the minority of Oslo Børs VPS` shareholders who have not yet committed their shares to Euronext. The acceptance period of the tender offer commenced on 14 January 2019, will expire on 11 March 2019 and can be extended as appropriate.

The offer is subject to fulfilment or waiver of certain conditions, including but not limited to minimum acceptance level  of at least 50.01 % of Oslo Børs VPS outstanding shares (including shares already held by Euronext), condition which is already met, regulatory approvals, short confirmatory due diligence, a favourable vote from a majority of Euronext shareholders and completion of the transaction before 31 December 2019.

Euronext submitted its suitability application to Finanstilsynet concurrently to the launch of its Offer and has regular dialogue with all relevant parties. Euronext is authorised to operate regulated markets in Belgium, France, Ireland, the Netherlands, Portugal and the United Kingdom, and believes that its strategic ambition would preserve and strengthen the Norwegian financial market ecosystem.

Euronext is confident that the transaction can be completed during the course of Q2 2019 within the customary regulatory approval period in Norway according to applicable laws and regulations.

Euronext is determined to acquire Oslo Børs VPS and remains committed to a constructive and continuous dialogue with Oslo Børs VPS shareholders, Board and management as well as the wider Norwegian ecosystem. Euronext`s Reference Shareholders have also confirmed their joint support to Euronext for this transaction.

Creating a leading player in the Nordics by supporting Oslo Børs VPS`s ambition

Euronext aims to leverage Oslo Børs VPS`s strong domestic position and international excellences to support its ambitions to become a leading market infrastructure in the Nordics. Euronext`s ambition is to work together with all market participants to deliver a more competitive, innovative and dynamic Oslo Børs VPS for the benefit of its clients, its employees and the wider Norwegian financial community.

Euronext is a family of six local exchanges in Europe with the technology, the financial means and the resources needed to power the capital markets financing the real economy. Continuity, local governance and decentralised decision-making are the key principles of Euronext`s model, as demonstrated by the Irish Stock Exchange joining the Euronext family in 2018.

Euronext`s decentralised model will allow Oslo Børs VPS to preserve its local footprint, management and vibrant local market, and to support its ambitions by leveraging the strengths of an agile European exchange Group.

  • Euronext regards highly the role Oslo Børs VPS plays in providing financing and serving the Norwegian financial ecosystem, large corporations and local SMEs, both domestically and internationally. Euronext is committed to maintaining, investing in and developing Oslo Børs VPS as a key market infrastructure in Norway and internationally for the benefit of all stakeholders:
    • Euronext will leverage the competitive advantage of Oslo Børs VPS`s markets and preserve its efficient listing rules, deep sector expertise and Norwegian-specific products including Fish Pool located in Bergen.
    • Euronext will support the strong international listing franchise in the oil, seafood and shipping sectors that Oslo Børs VPS has developed over many years, as well as its very successful listings of bonds and equity certificates.
    • The Central Securities Depository VPS is a critical infrastructure that will continue to be independent from the exchange as it is today.
    • The company names Oslo Børs and VPS, which are key assets and widely recognised by client community, will remain unchanged under Euronext ownership.
    • The Board of Oslo Børs VPS will continue to include Norwegian independent members and employees.
    • There will be no change in the regulatory environment linked to Euronext`s transaction and Finanstilsynet will be invited to join Euronext`s college of regulators, that supervises Euronext at Group-level.
  • Euronext`s vision for Oslo Børs VPS is to empower its Norwegian management team to strengthen, invest in and expand the business:
    • Oslo Børs VPS will become Euronext`s development hub and launchpad for expansion in the Nordics. Oslo will be the headquarters for all of Euronext`s future activities in the Nordic region and will become its group-level centre of excellence for all activities in commodities across Euronext businesses under the leadership of the CEO of Oslo Børs VPS.
    • Euronext will enhance Oslo Børs VPS`s technology and innovation capabilities, notably through the roll-out of Euronext`s state-of-the-art proprietary Optiq® trading technology.
    • All Oslo Børs VPS employees will have access to Euronext`s career and mobility opportunities. They will be able to develop their expertise thanks to the Euronext Learning Weeks across geographies, involving internal and external thought leaders. They will contribute to the next strategic plan thanks to the innovative participative approach deployed across the group. Euronext`s unique decentralized model will allow them to be part of a strong and lively local team in Norway, but also to be part of an international team in their professional field on a daily basis.
    • Issuers and investors of Oslo Børs VPS will have access to the largest liquidity pool in Europe, with increased visibility to international and sector-specialised investors. They will also have access to an exclusive market data portal for issuers. Euronext is the leading exchange in Continental Europe, with EUR8.1 billion traded every day on average on its cash markets and 5,000 active international investors, and is the leading venue for the listing of debt, allowing corporates to finance their growth.
    • Oslo Børs VPS issuers will have access to the full range of Euronext`s suite of corporate services, to accompany their financial communication needs.
    • In addition, the Norwegian ecosystem will benefit from programmes dedicated to supporting SMEs and family businesses, such as TechShare and FamilyShare. Euronext is the leading listing venue for SMEs in Continental Europe, connecting through dedicated initiatives more than 950 SMEs listed on its markets, with 1,200 active investors dedicated to SMEs.
    • Euronext remains strongly committed to securing the position of VPS, the national CSD, through technology investments, maintained operational independence and continued local supervision and regulation.
    • In line with Euronext`s practices and previous combinations, the CEO of Oslo Børs VPS will be invited to join the Managing Board of Euronext at Group level with group-wide responsibilities for commodities as well as the role of local CEO in charge of Norwegian clients and relations with all stakeholders, leading Euronext`s ambitions in the Nordic region. Oslo Børs VPS`s management team would join Euronext`s Senior Leadership Team in charge of the implementation of Euronext`s strategy.
    • Euronext will also invite a leading figure from the Norwegian financial community to join the Supervisory Board of Euronext (corresponding to Board of Directors). All these roles are at the most senior levels within Euronext`s governance framework and illustrate in practice Euronext`s decentralised and balanced management model.
    • Oslo Børs VPS will continue to keep a local Board of Directors including representation of minority shareholders, independent members of the Norwegian business community and employees.
    • Euronext will establish a local Market Advisory Board for Oslo Børs with representatives from the trading community and listed companies to provide guidance and recommendations regarding the rules of4 the exchange.

Euronext notes that the Board of Oslo Børs VPS decided and announced on 4 February 2019 to irrevocably support a competing offer, regardless of terms, and has not indicated at any point to Euronext that it would welcome a revised offer. Euronext has however been encouraged by widespread support for its project for Oslo Børs VPS following dialogue with a large number of relevant market participants in Norway, and remains keen to continue engaging with all key stakeholders in Oslo Børs VPS, including its management, board of directors and the local financial ecosystem.

  • Migration of Euronext Dublin to Optiq®

On 4 February 2019, Euronext announced the successful migration of the 53 companies currently listed on Euronext Dublin to Euronext`s state-of-the-art proprietary trading platform, Optiq®. This transition completed the equity migration from the Irish Stock Exchange plc to Euronext Dublin.

Companies listed on Euronext Dublin now join the 1,300 listed issuers, together with a combined market capitalisation of over
EUR3.4 trillion, already operating on the next generation trading platform launched in June 2018.

These listed companies can now avail of the benefits of trading on Optiq, and by joining a single, pan-European order book with thousands of investors, are now on a platform with their EU peers and have access to deeper pools of international capital. As part of being listed on Euronext, Dublin listed companies now have access to the proprietary issuer services of Euronext, including the online Connect portal which gives them access to their trading data, and corporate services such as Investor Relations Manager, My Share Price Live, Skope, and Company Webcast Solutions.

In addition, as part of the transition which occurred on February 4th, Euronext Dublin has changed the name of its two key markets to align with the rest of the Euronext group. The `Main Securities Market` (MSM), has been renamed to `Euronext Dublin`, whilst the `Enterprise Securities Market` (ESM) is now `Euronext Growth`. There have been no substantive rule changes or functionality changes to these markets. The `Global Exchange Market` (GEM) and `Atlantic Securities Market` (ASM) remain unchanged.

  • Update on FastMatch Inc

On February 1, 2019 a settlement was reached between FastMatch Inc, Euronext US Inc and the former CEO of FastMatch Inc. Between the parties it was agreed that $768,000 would be paid to the former CEO in settlement of claims of alleged breach by FastMatch of his employment agreement, and an amount of $8,132,000 as additional consideration for the 1,437,575 shares of common stock of FastMatch Inc that were transferred by the former CEO to Euronext US on August 10, 2018 for $.001 per share.

  • Volumes for January 2019

Cash trading

In January 2019, the average daily transaction value on the Euronext cash order book stood at EUR6,708.1 million, down -16.0% compared to January 2018 and down -15.1% from the previous month.

The average daily transaction value on the ETF order book was EUR205 million, down -28.3% compared to January 2018 and down -19.4% from the previous month. At the end of January 2019, 1,168 ETFs were listed on Euronext compared to 1,150 at the end of December 2018.

Derivatives trading

In January 2019, the overall average daily volume on derivatives reached 523,542 contracts, down -6.7% compared to January 2018 and down -19.6% compared to the previous month. In detail:

  • the average daily volume on equity index derivatives reached 214,202 contracts, up +7.3% compared to January 2018 and down -25.0% from the previous month,
  • the average daily volume on individual equity derivatives reached 268,304 contracts, down -14.4% compared to January 2018 and down -18.2% from the previous month,
  • the average daily volume on commodity derivatives reached 41,036 contracts, down -14.5% compared to January 2018 and up +8.2% from the previous month.

At the end of January 2019, the open interest was flat at 16,720,087 contracts (-0.6% compared to the end of January 2018).

FX spot trading      

In January 2019, the average daily volume on the spot foreign exchange market of FastMatch, operating as a Euronext company since August 2017, stood at $20,050 million, down -3.5% compared to January 2018 and up +4.9% from the previous month.

Listings

In January 2019, EUR96.0 billion was raised on Euronext in bonds of which two green bonds from Engie for EUR1bln and another one from Réseau Ferré de France for EUR0.5 bln. In addition, EUR3.2 billion was raised in follow-on equity.



Agenda

A conference call and a webcast will be held tomorrow Friday 15 February 2019,  at 9.00am CET (Paris time) / 8.00am UK time:

Website : www.euronext.com/en/investors

To connect to the conference call, please dial:

  • UK Number:         +442071943759
  • FR Number:          +33 172727403
  • NL Number:         +31207095119
  • US Number:         +1 6467224916
  • BE Number:          +3224035816
  • PT Number:          +351210609110
  • IR Number:           +35315060451

PIN CODE: 28227246#

Live Webcast:
A live audio webcast and replay after the call will be available via this link and on Euronext`s Investor Relations website.

Contacts

Investor Relations:
Aurélie Cohen, Head of Investor Relations                                     +33 1 70 48 24 17; ir@euronext.com  

Media:
Pauline Bucaille, Chief Communication Officer                                              +33 1 70 48 24 41; mediateam@euronext.com
                                                                                                                                                                             

About Euronext

Euronext is the leading pan-European exchange in the Eurozone, covering Belgium, France, Ireland, The Netherlands, Portugal and the UK. With 1,300 listed issuers worth EUR3.4 trillion in market capitalisation as of end December 2018, Euronext is an unmatched blue chip franchise that has 24 issuers in the Morningstar® Eurozone 50 IndexSM and a strong diverse domestic and international client base. Euronext operates regulated and transparent equity and derivatives markets and is the largest centre for debt and funds listings in the world. Its total product offering includes Equities, Exchange Traded Funds, Warrants & Certificates, Bonds, Derivatives, Commodities and Indices. Euronext also leverages its expertise in running markets by providing technology and managed services to third parties. In addition to its main regulated market, Euronext also operates Euronext GrowthTM and Euronext AccessTM, simplifying access to listing for SMEs.

For the latest news, find us on Twitter (twitter.com/euronext) and LinkedIn (linkedin.com/euronext).

Disclaimer

This press release is for information purposes only and is not a recommendation to engage in investment activities. This press release is provided "as is" without representation or warranty of any kind. While all reasonable care has been taken to ensure the accuracy of the content, Euronext does not guarantee its accuracy or completeness. Euronext will not be held liable for any loss or damages of any nature ensuing from using, trusting or acting on information provided. No information set out or referred to in this publication July be regarded as creating any right or obligation. The creation of rights and obligations in respect of financial products that are traded on the exchanges operated by Euronext`s subsidiaries shall depend solely on the applicable rules of the market operator. All proprietary rights and interest in or connected with this publication shall vest in Euronext.
This press release speaks only as of this date. Euronext refers to Euronext N.V. and its affiliates. Information regarding trademarks and intellectual property rights of Euronext is located at www.euronext.com/terms-use.
© 2019, Euronext N.V. - All rights reserved.

The Euronext Group processes your personal data in order to provide you with information about Euronext (the "Purpose"). With regard to the processing of these personal data, Euronext will comply with its obligations under the Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 (General Data Protection Regulation, "GDPR"), and any applicable national laws, rules and regulations implementing the GDPR as provided in its privacy statement available at: https://www.euronext.com/en/privacy-policy.
In accordance with the applicable legislation you have rights as regard to the processing of your personal data:

APPENDIX

Non-IFRS financial measures

For comparative purposes, the company provides unaudited non-IFRS measures including:

  • Operational expenses excluding depreciation and amortisation
  • EBITDA, EBITDA margin.

Non-IFRS measures are defined as follows:
      -          Operational expenses excluding depreciation and amortisation as the total of salary and employee benefits, and other operational expenses
-          EBITDA as the operating profit before exceptional items and depreciation and amortisation
-          EBITDA margin as the operating profit before exceptional items and depreciation and amortisation, divided by revenue.

Non-IFRS financial measures are not meant to be considered in isolation or as a substitute for comparable IFRS measures and should be read only in conjunction with the consolidated financial statements.

IFRS 15 Changes

Euronext has chosen to adopt the modified retrospective approach and is therefore not required to restate financial statement issued prior to 1 January 2018 incorporating the impact of IFRS 15:

  Reported Reported (incl.
IFRS 15)
Adjusted
for IFRS 15
IFRS 15 deferral
adjustments
Excl. IFRS 15 impact Reported  
(excl. IFRS 15 impact)
Unaudited, In EURm Q4 2018 Q3 2018 Q2 2018 Q1 2018 Q3 2018 Q2 2018 Q1 2018 Q3 2018 Q2 2018 Q1 2018
Revenue 157.3 150.9 156.3 150.5 +4.3 -1.0 +3.8 146.7 157.3 146.7
o/w Listing 29.5 27.8 27.4 21.8 +4.3 -1.0 +3.8 23.5 28.4 18.0
EBITDA 86.9 87.8 87.6 92.0 +4.3 -1.0 +3.8 83.5 88.6 88.2
EBITDA margin 55.3% 58.2% 56.0% 61.1%       56.9% 56.3% 60.1%
Profit before income tax 71.1 73.5 80.3 86.8 +4.3 -1.0 +3.8 69.3 81.3 83.0
Income tax
expense
-21.1 -22.6 -24.0 -26.3 -1.2 +0.2 -1.1 -21.4 -24.3 -25.2
Share of non-controlling
interests
-0.4 -0.5 -0.4 -0.4  -  -0.5 -0.4 -0.4
Profit for the period 49.6 50.5 55.8 60.0 +3.1 -0.8 +2.7 47.4 56.6 57.3
Reported EPS (in EUR) 0.71 0.73 0.80 0.86 +0.04 -0.01 +0.04 0.68 0.81 0.82
Adjusted EPS (in EUR) 0.81 0.85 0.89 0.89 +0.04 -0.01 +0.04 0.81 0.90 0.85

However for information purposes the P&L impact of IFRS 15 for the year ended 31 December 2017 would have been:

For informative purpose only, in EURm FY 2017 Q4 2017 Q3 2017 Q2 2017 Q1 2017
Revenue - revised for IFRS 15 526.7 140.4 128.7 132.5 125.1
o/w Listing 78.6 22.3 20.2 18.8 17.3
           
IFRS 15 deferral adjustment -5.6 +0.7 0 -4.8 -1.5


Adjusted EPS definition

In EURm unless stated otherwise Q4 2018 Q4 2017 FY 2018 FY 2017
Net Income Reported 49.6   105.1  216.0  241.3 
EPS Reported (EUR per share)   0.71  1.51  3.10  3.47 
Intangible assets adj.
related to acquisitions (PPA)
- 2.0  - 2.4  - 7.4  - 2.4 
Exceptional items - 5.5  -  0.6  - 21.5  -14.8 
Results from Equity Investments
(LCH swap capital gain)
40.6  40.6 
Tax related to those items       0.8  -  1.1            5.6  2.7 
Adjusted for intangible assets related to acquisitions, capital gains or
losses and exceptional items, incl. tax
       
Adj. Net Income   56.3  67.5   239.3   215.2 
Adj. EPS (EUR per share)    0.81  0.97     3.44     3.09 

Quarterly summarized P&L

  in MEUR, including IFRS 15 2018  
    FY Q4 Q3 H1 Q2 Q1
Revenue Core business excluding clearing 495.8 124.8 118.9 252.1 123.7 128.4
AfG 17.6 5.4 4.3 7.9 4.0 3.9
Core business + AfG, excl.
Clearing and new perimeter
513.4 130.2 123.2 259.9 127.7 132.3
New Perimeter (FastMatch and
Euronext Dublin (from Q2 2018))
46.4 13.7 13.5 19.2 14.0 5.2
Total Group revenue 615.0 157.3 150.9 306.8 156.3 150.5
Costs (exc. D&A) Core business excluding clearing -180.6 -46.9 -43.2 -90.5 -47.4 -43.1
AfG -16.3 -5.0 -3.6 -7.7 -3.9 -3.7
Core business + AfG, excl.
Clearing and new perimeter
-197.0 -51.9 -46.9 -98.2 -51.3 -46.9
New Perimeter (FastMatch and
Euronext Dublin (from Q2 2018))
-35.5 -11.4 -9.0 -15.1 -10.2 -4.9
Total Group Costs (exc. D&A) -260.8 -70.4 -63.2 -127.2 -68.7 -58.5
EBITDA margin Core business excluding clearing 63.6% 62.4% 63.7% 64.1% 61.7% 66.4%
AfG 7.25% 7.37% 15.42% 2.71% 1.17% 4.28%
Core business + AfG, excl.
Clearing and new perimeter
61.6% 60.1% 62.0% 62.2% 59.8% 64.6%
New Perimeter (FastMatch and
Euronext Dublin (from Q2 2018))
23.4% 16.4% 33.2% 21.6% 27.3% 6.2%
Group EBITDA margin 57.6% 55.3% 58.2% 58.5% 56.0% 61.1%
Savings Core business 23.8 23.8 24.2 24.2 18.8 16.2
New Perimeter (Euronext Dublin
from Q2 2018)
2.7 2.7 0.8 0.6 0.6 0

Consolidated income statement

Unaudited, In EURm Q4 2018 Q4 2017 % var FY 2018 FY 2017 % var
Revenue 157.3 139.7 +12.6% 615.0 532.3 +15.5%
Listing 29.5 21.6 +36.2% 106.5 84.2 +26.4%
Trading revenue 69.8 63.1 +10.6% 276.6 237.9 +16.3%
Cash Trading 52.8 48.8 +8.2% 210.9 190.3 +10.9%
Derivatives Trading 11.4 9.9 +15.2% 43.9 40.3 +8.9%
Spot FX Trading 5.5 4.4 +26.8% 21.7 7.2 N/A
Advanced Data Services 29.8 27.7 +7.6% 118.3 104.7 +13.0%
Post-trade 18.9 18.6 +1.7% 77.4 71.7 +7.9%
Clearing 13.4 13.3 +1.0% 55.3 51.1 +8.2%
Custody, Settlement and other post-trade 5.5 5.3 +3.5% 22.1 20.6 +7.2%
Euronext Technologies & other revenue 9.2 8.5 +8.1% 36.1 33.5 +7.8%
Other income 0.1 0.1 +14.6% 0.2 0.4 -35.9%
Operational expenses excluding D&A -70.4 -61.0 +15.3% -260.8 -234.5 +11.2%
Salaries and employee benefits -33.4 -28.8 +16.0% -118.5 -104.4 +13.5%
Other Operational Expenses -37.0 -32.2 +14.8% -142.3 -130.1 +9.3%
System & Communication -7.9 -6.1 +29.2% -26.2 -22.4 +17.2%
Professional Services -12.0 -11.7 +2.4% -47.0 -45.5 +3.2%
Clearing expense -7.3 -7.4 -1.0% -29.8 -27.9 +6.9%
Accommodation -2.7 -2.6 +2.3% -10.4 -10.0 +4.7%
Other Operational Expenses -7.1 -4.4 +61.4% -28.8 -24.4 +18.2%
EBITDA 86.9 78.7 +10.5% 354.3 297.8 +19.0%
EBITDA margin 55.3% 56.3% -1.1% 57.6% 55.9% +1.7%
Depreciation & Amortisation -6.1 -6.3 -2.5% -23.4 -16.9 +38.2%
Operating Profit before Exceptional items 80.8 72.3 +11.6% 330.9 280.8 +17.8%
Exceptional items -5.5 -0.6 N/A -21.5 -14.8 +45.2%
Operating Profit 75.3 71.7 +5.0% 309.4 266.1 +16.3%
Net financing income / (expense) -4.0 -1.6 +146.5% -5.3 -3.6 N/A
Results from equity investments -0.2 42.1 N/A 7.6 48.6 -84.4%
Profit before income tax 71.1 112.2 -36.6% 311.7 311.1 +0.2%
Income tax expense -21.1 -6.9 +204.6% -94.1 -68.9 +36.6%
Share of non-controlling interests -0.4 -0.2 +123.7% -1.7 -0.9 +86.2%
Profit for the period 49.6 105.1 -52.8% 216.0 241.3 -10.5%
       
EPS Reported (in EUR per share) EUR 0.71 EUR 1.51 -52.8% EUR 3.10 EUR 3.47 -10.5%
EPS Diluted (in EUR per share) EUR 0.71 EUR 1.50 -52.8% EUR 3.09 EUR 3.45 -10.4%

The figures in this document have not been audited or reviewed by our external auditor.

Consolidated comprehensive income statement


Unaudited, In EURm Q4 2018 Q4 2017 FY 2018 FY 2017
Profit for the period 50.0 105.3 217.6 242.2
         
Other comprehensive income        
Items that may be reclassified to profit or loss:        
- Exchange differences on translation of foreign operations 2.0 -2.6 6.0 -2.8
- Change in value of available-for-sale financial assets 0.0 38.4 0.0 78.6
- Realisation of historical revaluation upon sale of available-for-sale financial assets 0.0 -40.5 0.0 -40.5
- Income tax impact change in value of available-for-sale financial assets 0.0 0.7 0.0 -6.4
         
Items that will not be reclassified to profit or loss:        
- Change in value of equity investments at fair value through other comprehensive income 35.9 0.0 35.4 0.0
- Income tax impact on change in value of equity investments at fair value through
  other comprehensive income
-5.7 0.0 -5.5 0.0
- Remeasurements of post-employment benefit obligations 1.9 1.0 1.7 3.6
- Income tax impact post-employment benefit obligations 0.0 0.0 -0.1 -0.3
Other comprehensive income for the period net of tax 34.1 -3.0 37.4 32.3
Total comprehensive income for the period 84.1 102.3 255.1 274.5
         
Comprehensive income attributable to:        
- Owners of the parent   83.7  102.2   253.3  273.7
- Non-controlling interests   0.4  0.1    1.7  0.8

The figures in this document have not been audited or reviewed by our external auditor.

Consolidated balance sheet

Unaudited, In EURm As at 31 Dec 2018 As at 31 Dec 2017
Non-current assets    
Property, plant and equipment 38.9 27.8
Goodwill and other intangible assets 705.6 515.1
Deferred income tax assets 20.9 8.0
Investments in associates and JV 72.7 75.0
Financial assets at fair value through OCI 220.1 147.5
Other non current assets 7.8 8.0
Total non-current assets 1,066.1 781.4
     
Current assets    
Trade and other receivables 110.3 95.0
Income tax receivable 2.5 1.4
Derivative financial instruments 7.4 0.0
Other current financial assets 14.2 0.0
Cash & cash equivalents 398.0 187.8
Total current assets 532.4 284.2
     
Total assets   1,598.5    1,065.6 
     
Shareholders` equity    
Shareholders` equity 791.1 715.3
Non-controlling interests 11.2 14.2
Total Equity 802.3 729.5
     
Non-current liabilities    
Borrowings 504.9 164.7
Other non-current financial liabilities 17.4 10.0
Deferred income tax liabilities 21.4 19.8
Post employment benefits 10.7 11.7
Contract liabilities 41.5 0.0
Other provisions 6.0 5.1
Total Non-current liabilities 601.9 211.3
     
Current liabilities    
Borrowings 3.7 0.2
Other current financial liabilities 7.0 6.7
Derivative financial instruments 0.1 0.0
Income tax payable 11.2 17.4
Trade and other payables 115.3 99.2
Contract liabilities 55.5 0.0
Other provisions 1.4 1.3
Total Current liabilities 194.2 124.8
     
Total equity and liabilities 1,598.5 1,065.6

The figures in this document have not been audited or reviewed by our external auditor.

Consolidated statement of cash flows

Unaudited, In EURm Q4 2018 Q4 2017 FY 2018 FY 2017
Profit before tax 71.1 112.2 311.7 311.1
         
Adjustments for:        
- Depreciation and amortization 6.1 6.3 23.4 16.9
- Share based payments 1.0 0.9 4.0 3.8
- Change in fair value of financial instruments 3.2 0.0 3.2 0.0
- Gain on disposal of available-for-sale financial assets 0.0 -42.2 0.0 -42.2
- Share of profit from associates and joint ventures 1.9 -0.1 -1.6 -0.3
- Changes in working capital -5.0 -6.2 -18.9 -13.8
Cash flow from operating activities 78.4 71.0 321.8 275.4
Income tax paid -22.9 -18.6 -98.3 -68.4
Net cash flows from operating activities 55.4 52.4 223.5 207.0
         
Cash flow from investing activities        
Acquisition of associates and joint ventures 0.0 -0.2 -0.9 -2.1
Acquisition of subsidiaries, net of cash acquired -27.5 0.0 -176.1 -157.3
Purchase of financial assets at FVOCI (2017: AFS financial assets) -31.7 0.1 -31.7 -9.6
Proceeds from disposal of available-for-sale financial assets 0.0 1.7 0.0 1.7
Purchase of current financial assets -1.3 0.0 -14.3 0.0
Redemption of current financial assets 2.9 0.0 18.8 0.0
Purchase of property, plant and equipment -3.6 -1.7 -11.0 -6.1
Purchase of intangible assets -3.7 -5.3 -11.3 -17.8
Proceeds from sale of Property, plant, equipment and intangible assets 0.2 0.0 0.4 0.0
Dividends received from equity investments 1.6 1.5 6.0 6.1
Dividends received from associates 0.0 0.0 4.9 0.0
Net cash flow from investing activities -63.0 -3.8 -215.2 -185.1
         
Cash flow from financing activities        
Proceeds from borrowings, net of transaction fees -0.1 -32.0 496.6 165.0
Repayment of borrowings, net of transaction fees 0.0 32.0 -165.0 -71.2
Interest paid -0.1 -0.3 -0.6 -0.7
Interest received 0.0 0.0 0.3 0.3
Acquisition of own shares -0.8 -0.8 -5.8 -1.0
Employee Share transactions -1.2 0.0 -1.4 -2.1
Dividends paid to the company`s shareholders 0.0 0.0 -120.4 -98.8
Dividends paid to non-controlling interests 0.0 0.0 -1.6 0.0
Net cash flow from financing activities -2.1 -1.1 202.0 -8.5
         
Total cash flow over the period -9.7 47.5 210.4 13.4
Cash and cash equivalents - Beginning of period 407.6 140.6 187.8 174.5
Non Cash exchange gains/(losses) on cash and cash equivalents 0.1 -0.3 -0.1 -0.1
Cash and cash equivalents - End of period 398.0 187.8 398.0 187.8

The figures in this document have not been audited or reviewed by our external auditor.
Certain amounts do not correspond to 2017 reported figures, due to reclassifications made.



Volumes for Q4 2018

Cash markets activity

  Q4 2018 Q4 2017   FY 2018 FY 2017  
             
Nb trading days 64 63   255 255  
             
NUMBER OF TRANSACTIONS (Buy and sells) (reported trades included)            
  Q4 2018 Q4 2017 Change % FY 2018 FY 2017 Change %
Total Cash Market * 124,967,174 124,962,338 0.0% 469,167,736 486,699,332 -3.6%
ADV Cash Market * 1,952,612 1,983,529 -1.6% 1,839,873 1,908,625 -3.6%
             
TRANSACTION VALUE ( EUR million - Single counted)            
(EURm) Q4 2018 Q4 2017 Change % FY 2018 FY 2017 Change %
Total Cash Market * 518,505.54 497,421.28 4.2% 2,067,918.02 1,956,076.85 5.7%
ADV Cash Market * 8,101.65 7,895.58 2.6% 8,109.48 7,670.89 5.7%
* (shares, warrants, trackers, bonds...)            
             
LISTINGS            
  As at end
Dec-18
As at end
Dec-17
       
Number of Issuers on Equities     Change %      
EURONEXT ** 1,259 1,306 -3.6%      
SMEs 726 747 -2.8%      
Number of Listed Securities            
Bonds 40,442 37085 9.1%      
ETFs 1,150 1048 9.7%      
Funds 5,194 5662 -8.3%      
**(Euronext, Euronext Growth and Euronext Access)            
             
Capital raised on Equities on Primary and Secondary Market            
EURONEXT (Euronext, Euronext Growth)            
(EURm) Q4 2018 Q4 2017 Change % FY 2018 FY 2017 Change %
Nb New Listings ** 9 8   33 29  
Money Raised New Listings incl over allotment 1,324 1,190 11.3% 3,595 4,217 -14.7%
of which Money Raised New Listings 1,254 1,134 10.6% 3,373 4,028 -16.3%
Follow-ons on Equities 34,757 10,196 240.9% 60,724 62,341 -2.6%
Bonds 298,065 125,243 138.0% 935,989 722,877 29.5%
Total Money Raised * 334,147 136,628 144.6% 1,000,308 789,435 26.7%
             
of which SMEs            
(EURm) Q4 2018 Q4 2017 Change % FY 2018 FY 2017 Change %
Nb New Listings ** 7 5   27 18  
Money Raised New Listings incl over allotment 52 648 -91.9% 675 1,434 -52.9%
of which Money Raised New Listings 51 592 -91.4% 643 1,356 -52.6%
Follow-ons on Equities 1,367 1,441 -5.1% 5,345 6,344 -15.8%
Bonds 388 797 -51.4% 1,048 1,762 -40.5%
Total Money Raised * 1,807 2,887 -37.4% 7,067 9,540 -25.9%

* included New Listings incl over allotment, Follow-ons on Equities, Corporate Bonds on Euronext Listed Issuers.
Following the completion of the acquisition of the Irish Stock Exchange (now operating as Euronext Dublin), Euronext 2017 trading data have been restated to include historic data for Euronext Dublin.


Derivatives markets activity

  Q4 2018 Q4 2017   FY 2018 FY 2017  
             
Nb trading days 64 63   255 255  
             
Volume (in lots)            
  Q4 2018 Q4 2017 Change % FY 2018 FY 2017 Change %
Equity 35,668,935 32,023,541 11.4% 134,670,434 127,093,195 6.0%
of which AtomX 324,592 259,823   1,360,138 744,045 82.8%
             
Index 16,597,335 13,104,573 26.7% 58,932,292 56,590,072 4.1%
of which AtomX 114,595 54,657   555,427 225,316 146.5%
Futures 11,188,923 9,231,246 21.2% 39,885,361 41,912,510 -4.8%
of which AtomX 89,662 54,657   383,296 217,616 76.1%
Options 5,408,412 3,873,327 39.6% 19,046,931 14,677,562 29.8%
of which AtomX 24,933 0   172,131 7700 >500%
             
Individual Equity 19,071,600 18,918,968 0.8% 75,738,142 70,503,123 7.4%
of which AtomX 209,997 205,166   804,711 518,729 55.1%
Futures 548,843 77,581 >500% 1,104,916 389,909 183.4%
of which AtomX 7,500 27500   65,671 72975 -10.0%
Options 18,522,757 18,841,387 -1.7% 74,633,226 70,113,214 6.4%
of which AtomX 202,497 177,666   739,040 445,754 65.8%
             
Commodity 2,880,072 2,944,427 -2.2% 14,583,707 13,165,333 10.8%
Futures 2,752,622 2,779,713 -1.0% 13,435,644 12,170,346 10.4%
Options 127,450 164,714 -22.6% 1,148,063 994,987 15.4%
             
Other 0 0   0 18,399  
Futures 0 0   0 0  
Options 0 0   0 18,399  
             
Total Euronext 38,549,007 34,967,968 10.2% 149,254,141 140,276,927 6.4%
Total Futures 14,490,388 12,088,540 19.9% 54,425,921 54,472,765 -0.1%
Total Options 24,058,619 22,879,428 5.2% 94,828,220 85,804,162 10.5%



ADV (in lots)            
  Q4 2018 Q4 2017 Change % FY 2018 FY 2017 Change %
Equity 557,327 508,310 9.6% 528,119 498,405 6.0%
of which AtomX 5,072 4,124   5,334    
             
Index 259,333 208,009 24.7% 231,107 221,922 4.1%
of which AtomX 1,791 868   2,178    
Futures 174,827 146,528 19.3% 156,413 164,363 -4.8%
of which AtomX 1,401 868   1,503    
Options 84,506 61,481 37.5% 74,694 57,559 29.8%
of which AtomX 390 0   675    
             
Individual Equity 297,994 300,301 -0.8% 297,012 276,483 7.4%
of which AtomX 3,281 3,257   3,156    
Futures 8,576 1,231 >500% 4,333 1,529 183.4%
of which AtomX 117 437   258    
Options 289,418 299,070 -3.2% 292,679 274,954 6.4%
of which AtomX 3,164 2,820   2,898    
             
Commodity 45,001 46,737 -3.7% 57,191 51,629 10.8%
Futures 43,010 44,122 -2.5% 52,689 47,727 10.4%
Options 1,991 2,615 -23.8% 4,502 3,902 15.4%
             
Other 0 0   0 72  
Futures 0 0   0 0  
Options 0 0   0 72  
             
Total Euronext 602,328 555,047 8.5% 585,310 550,106 6.4%
Total Futures 226,412 191,882 18.0% 213,435 213,619 -0.1%
Total Options 375,916 363,166 3.5% 371,875 336,487 10.5%
             
Open Interest            
  Dec-18 Dec-17 Change %      
Equity 13,990,369 14,093,432 -0.7%      
             
Index 1,318,875 1,247,257 5.7%      
Futures 576,631 540,643 6.7%      
Options 742,244 706,614 5.0%      
             
Individual Equity 12,671,494 12,846,175 -1.4%      
Futures 276,211 10,716 >500%      
Options 12,395,283 12,835,459 -3.4%      
             
Commodity 654,920 619,824 5.7%      
Futures 446,232 435,917 2.4%      
Options 208,688 183,907 13.5%      
             
Other 0 0        
Futures 0 0        
Options 0 0        
             
Total Euronext 14,645,289 14,713,256 -0.5%      
Total Futures 1,299,074 987,276 28.3%      
Total Options 13,346,215 13,725,980 8.0%      

Spot FX Trading

  Q4 2018 Q4 2017   FY 2018 FY 2017  
Nb trading days 65 64   259 258  
             
Spot FX VOLUME (in USD millions, single counted)        
  Q4 2018 Q4 2017 Change % FY 2018 FY 2017 Change %
Total Spot FX Market 1,270,124 1,099,719 15.5% 5,216,112 4,752,468 9.8%
ADV Spot FX Market 19,540 17,183 13.7% 20,139 18,420 9.3%

*END*



[1] In 2018, Euronext has adopted IFRS 15. Unless stated otherwise, percentages compare Full Year 2018 and Q4 2018 data including IFRS 15 to respectively reported Full Year 2017 and Q4 2017 data (excluding IFRS 15). For further details, please refer to the appendix

[2] Formerly « Market data and indices »

[3] Definition in appendix

[4] Annual General Meeting of Shareholders

[5] Based on an exchange rate of EUR 1.00 = NOK 9.97 as of December 23, 2018.

[6] 9.77 EUR/NOK FX rate as of 8 February 2019; before additional interest payment

[8] Compared to Group operating costs excluding D&A for 2018 of EUR260.8m

[9] For 2018, Euronext Dublin costs were only consolidated for 3 quarters. As a reminder, the operating costs for Euronext Dublin for Q1 2018 were EUR5.8m

[10] Volume related businesses include Cash, Derivatives, Spot FX trading, Clearing, and IPO

[11] Non-volume related businesses revenue divided by operating costs (excluding D&A)

[12] Please refer to table in appendix

[13] Purchase Price Allocation

[14] Formerly commercialized as iBabs

[15] Definition in appendix

[16] Volume related businesses include Cash, Derivatives, Spot FX trading, Clearing, and IPO

[17] Non-volume related businesses revenue divided by operating costs (excluding D&A)

[18] Please refer to table in appendix

[19] Purchase Price Allocation

[20] Formerly commercialized as iBabs

[21] Following the completion of the acquisition of the Irish Stock Exchange (now operating as Euronext Dublin), Euronext 2017 trading data have been restated to include historic data for Euronext Dublin.

[22]Reporting perimeter for Follow-ons has been revised to align with most recent changes in the FESE methodology for European capital markets statistics. Further to such changes, statistics now include Equity issues reserved to employees and Stock options. Therefore, the comparable 2017 Follow-ons figures would amount to EUR68.8bn vs EUR62.3bn previously reported.

[23] Following the completion of the acquisition of the Irish Stock Exchange (now operating as Euronext Dublin), Euronext 2017 trading data have been restated to include historic data for Euronext Dublin.

[24] As from January 2018 Euronext reports its ETFs trading volumes on an on-exchange basis (Electronic order book volume)

[25] Previously reported as `Market Data & Indices`, please refer to `Corporate highlights` section for more information

[26] Previously reported as `Market Solutions`

[27] As from January 2018 Euronext reports its ETFs trading volumes on an on-exchange basis (Electronic order book volume)

[28] Based on an exchange rate of EUR 1.00 = NOK 9.97 as of December 23, 2018.

[30] Based on an exchange rate of EUR 1.00 = NOK 9.97 as of December 23, 2018.

[31] 9.77 EUR/NOK FX rate as of 8 February 2019; before additional interest payment

Source: Euronext
Provider: Thomson Reuters ONE