CHICAGO, April 27,
2022 /PRNewswire/ -- CME Group Inc. (NASDAQ: CME)
today reported financial results for the first quarter of 2022.
The company reported revenue of $1.3
billion and operating income of $859
million for the first quarter of 2022. Net income was
$711 million and diluted earnings per
share were $1.95. On an
adjusted basis, net income was $766
million and diluted earnings per share were $2.11. Financial results presented on an
adjusted basis for the first quarter of 2022 and 2021 exclude
certain items, which are detailed in the reconciliation of non-GAAP
results.1
"During this period of extreme geopolitical and economic
uncertainty, our continued focus on helping clients manage their
risk resulted in strong earnings and revenue growth during the
first quarter," said CME Group Chairman and Chief Executive Officer
Terry Duffy. "Average daily
volume was robust with double-digit increases in equity index,
interest rate and options products, as well as significant volume
outside the U.S. In addition, we are pleased with the accelerated
growth of our SOFR futures and options since the start of the year,
including record quarterly volume and open interest. Looking ahead,
we will continue to provide the benchmark products, services and
data our clients need as they continue to navigate through evolving
central bank policies, inflation, supply chain constraints and
other economic challenges."
First-quarter 2022 average daily volume (ADV) was 25.9 million
contracts, including non-U.S. ADV of 7.3 million contracts, led by
28% growth in Latin America, 22%
in Asia and 17% in EMEA.
1. A reconciliation
of the non-GAAP financial results mentioned to the respective GAAP
figures can be found within the Reconciliation of GAAP to non-GAAP
Measures chart at the end of the financial statements and earnings
presentation materials.
|
Clearing and transaction fees revenue for first-quarter 2022
totaled $1.1 billion. The total
average rate per contract was $0.644. Market data revenue totaled
$152 million for first-quarter
2022.
As of March 31, 2022, the company
had approximately $2.1 billion in
cash (including $100 million
deposited with Fixed Income Clearing Corporation (FICC) and
included in other current assets) and $3.4
billion of debt. The company paid dividends during the
first quarter of $1.5 billion, which
included the annual variable dividend for 2021 of $1.2 billion. The company has returned
approximately $18 billion to shareholders in the form of
dividends since the implementation of the variable dividend policy
in early 2012.
CME Group will hold a Q&A conference call to discuss
first-quarter 2022 results at 8:30 a.m.
Eastern Time today. A live audio webcast of the
Q&A call will be available on the Investor Relations section of
CME Group's website at www.cmegroup.com. An archived
recording will be available for up to two months after the
call.
As the world's leading derivatives marketplace, CME Group
(www.cmegroup.com) enables clients to trade futures, options, cash
and OTC markets, optimize portfolios, and analyze data – empowering
market participants worldwide to efficiently manage risk and
capture opportunities. CME Group exchanges offer the widest range
of global benchmark products across all major asset classes based
on interest rates, equity indexes, foreign
exchange, energy, agricultural
products and metals. The company offers futures and
options on futures trading through the CME Globex® platform, fixed
income trading via BrokerTec and foreign exchange trading on the
EBS platform. In addition, it operates one of the world's
leading central counterparty clearing providers, CME
Clearing.
CME Group, the Globe logo, CME, Chicago Mercantile Exchange,
Globex, and, E-mini are trademarks of Chicago Mercantile
Exchange Inc. CBOT and Chicago Board of Trade are trademarks of Board
of Trade of the City of Chicago,
Inc. NYMEX, New York Mercantile Exchange and ClearPort are
trademarks of New York Mercantile Exchange, Inc. COMEX is a
trademark of Commodity Exchange, Inc. BrokerTec and EBS are
trademarks of BrokerTec Europe LTD and EBS Group LTD,
respectively. Dow Jones, Dow Jones Industrial Average, S&P
500 and S&P are service and/or trademarks of Dow Jones
Trademark Holdings LLC, Standard & Poor's Financial Services
LLC and S&P/Dow Jones Indices LLC, as the case may be, and have
been licensed for use by Chicago Mercantile Exchange Inc. All
other trademarks are the property of their respective
owners.
Statements in this press release that are not historical
facts are forward-looking statements. These statements are
not guarantees of future performance and involve risks,
uncertainties and assumptions that are difficult to predict.
Therefore, actual outcomes and results may differ materially from
what is expressed or implied in any forward-looking statements. We
want to caution you not to place undue reliance on any
forward-looking statements. We undertake no obligation to publicly
update any forward-looking statements, whether as a result of new
information, future events or otherwise. Among the factors that
might affect our performance are increasing competition by foreign
and domestic entities, including increased competition from new
entrants into our markets and consolidation of existing entities;
our ability to keep pace with rapid technological developments,
including our ability to complete the development, implementation
and maintenance of the enhanced functionality required by our
customers while maintaining reliability and ensuring that such
technology is not vulnerable to security risks; our ability to
continue introducing competitive new products and services on a
timely, cost-effective basis, including through our electronic
trading capabilities, and our ability to maintain the
competitiveness of our existing products and services, including
our ability to provide effective services to the swaps market; our
ability to adjust our fixed costs and expenses if our revenues
decline; our ability to maintain existing customers at
substantially similar trading levels, develop strategic
relationships and attract new customers; our ability to expand and
globally offer our products and services; changes in regulations,
including the impact of any changes in laws or government policies
with respect to our products or services or our industry, such
as any changes to regulations and policies that require increased
financial and operational resources from us or our customers; the
costs associated with protecting our intellectual property rights
and our ability to operate our business without violating the
intellectual property rights of others; decreases in revenue from
our market data as a result of decreased demand or changes to
regulations in various jurisdictions; changes in our rate per
contract due to shifts in the mix of the products traded, the
trading venue and the mix of customers (whether the customer
receives member or non-member fees or participates in one of our
various incentive programs) and the impact of our tiered pricing
structure; the ability of our credit and liquidity risk
management practices to adequately protect us from the credit risks
of clearing members and other counterparties, and to satisfy the
margin and liquidity requirements associated with the BrokerTec
matched principal business; the ability of our compliance and risk
management programs to effectively monitor and manage our risks,
including our ability to prevent errors and misconduct and protect
our infrastructure against security breaches and misappropriation
of our intellectual property assets; our dependence on third-party
providers and exposure to risk through third parties, including
risks related to the performance, reliability and security of
technology used by our third-party providers; volatility in
commodity, equity and fixed income prices, and price volatility of
financial benchmarks and instruments such as interest rates, credit
spreads, equity indices, fixed income instruments and foreign
exchange rates; economic, social, political and market conditions,
including the volatility of the capital and credit markets and the
impact of economic conditions on the trading activity of our
current and potential customers; the impact of the COVID-19
pandemic and response by governments and other third parties; our
ability to accommodate increases in contract volume and order
transaction traffic and to implement enhancements without failure
or degradation of the performance of our trading and clearing
systems; our ability to execute our growth strategy and maintain
our growth effectively; our ability to manage the
risks, control the costs and achieve the synergies associated
with our strategy for acquisitions, investments and alliances,
including those associated with our joint venture with IHS Markit
and our partnership with Google Cloud; uncertainty related to the
transition from LIBOR; our ability to continue to generate
funds and/or manage our indebtedness to allow us to continue to
invest in our business; industry and customer consolidation;
decreases in trading and clearing activity; the imposition of a
transaction tax or user fee on futures and options transactions
and/or repeal of the 60/40 tax treatment of such transactions; our
ability to maintain our brand and reputation; and the unfavorable
resolution of material legal proceedings. For a detailed
discussion and additional information concerning these and other
factors that might affect our performance, see our other recent
periodic filings, including our Annual Report on Form 10-K for the
year ended December 31, 2021, as
filed with the Securities and Exchange Commission ("SEC") on
February 25, 2022, under the caption
"Risk Factors".
CME Group Inc. and
Subsidiaries
|
Consolidated Balance
Sheets
|
(in
millions)
|
|
|
|
March 31,
2022
|
|
December 31,
2021
|
ASSETS
|
|
|
|
|
Current
Assets:
|
|
|
|
|
Cash and cash equivalents
|
|
$
2,045.7
|
|
$
2,834.9
|
Marketable securities
|
|
109.6
|
|
115.0
|
Accounts receivable, net of allowance
|
|
608.9
|
|
434.5
|
Other current assets (includes $4.8 and $4.8 in restricted
cash)
|
|
503.4
|
|
427.8
|
Performance bonds and guaranty fund contributions
|
|
167,736.7
|
|
157,949.6
|
Total current
assets
|
|
171,004.3
|
|
161,761.8
|
Property, net of
accumulated depreciation and amortization
|
|
493.9
|
|
505.3
|
Intangible
assets—trading products
|
|
17,175.3
|
|
17,175.3
|
Intangible
assets—other, net
|
|
3,463.2
|
|
3,532.0
|
Goodwill
|
|
10,515.8
|
|
10,528.0
|
Other assets (includes
$0.5 and $0.5 in restricted cash)
|
|
3,265.2
|
|
3,277.9
|
Total Assets
|
|
$
205,917.7
|
|
$
196,780.3
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
Accounts payable
|
|
$
80.8
|
|
$
48.8
|
Short-term debt
|
|
—
|
|
749.4
|
Other current liabilities
|
|
641.1
|
|
1,650.6
|
Performance bonds and guaranty fund contributions
|
|
167,736.7
|
|
157,949.6
|
Total current
liabilities
|
|
168,458.6
|
|
160,398.4
|
Long-term
debt
|
|
3,437.1
|
|
2,695.7
|
Deferred income tax
liabilities, net
|
|
5,381.7
|
|
5,390.4
|
Other
liabilities
|
|
903.5
|
|
896.5
|
Total
Liabilities
|
|
178,180.9
|
|
169,381.0
|
Total CME Group
Shareholders' Equity
|
|
27,736.8
|
|
27,399.3
|
Total Liabilities and
Equity
|
|
$
205,917.7
|
|
$
196,780.3
|
CME Group Inc. and
Subsidiaries
|
Consolidated
Statements of Income
|
(dollars in millions,
except per share amounts; shares in thousands)
|
|
|
|
Quarter Ended
March 31
|
|
|
2022
|
|
2021
|
Revenues
|
|
|
|
|
Clearing and transaction fees
|
|
$ 1,138.1
|
|
$ 1,007.0
|
Market data and information services
|
|
151.7
|
|
144.2
|
Other
|
|
56.8
|
|
102.1
|
Total
Revenues
|
|
1,346.6
|
|
1,253.3
|
Expenses
|
|
|
|
|
Compensation and benefits
|
|
185.2
|
|
225.0
|
Technology
|
|
45.9
|
|
48.2
|
Professional fees and outside services
|
|
31.8
|
|
37.4
|
Amortization of purchased intangibles
|
|
58.4
|
|
60.6
|
Depreciation and amortization
|
|
33.5
|
|
37.6
|
Licensing and other fee agreements
|
|
80.9
|
|
64.7
|
Other
|
|
51.8
|
|
54.7
|
Total
Expenses
|
|
487.5
|
|
528.2
|
Operating Income
|
|
859.1
|
|
725.1
|
Non-Operating Income (Expense)
|
|
|
|
|
Investment income
|
|
73.1
|
|
30.9
|
Interest and other borrowing costs
|
|
(42.5)
|
|
(41.5)
|
Equity in net earnings of unconsolidated
subsidiaries
|
|
73.3
|
|
56.2
|
Other non-operating income (expense)
|
|
(46.7)
|
|
(18.4)
|
Total Non-Operating Income
(Expense)
|
|
57.2
|
|
27.2
|
Income before Income Taxes
|
|
916.3
|
|
752.3
|
Income tax
provision
|
|
205.3
|
|
177.5
|
Net Income
|
|
711.0
|
|
574.8
|
Less: net (income) loss
attributable to non-controlling interests
|
|
—
|
|
(0.4)
|
Net Income Attributable to CME
Group
|
|
$
711.0
|
|
$
574.4
|
Net Income Attributable to Common Shareholders of CME
Group
|
|
$
702.0
|
|
$
574.4
|
|
|
|
|
|
Earnings per Share Attributable to Common
Shareholders of CME Group:
|
|
|
|
|
Basic
|
|
$
1.96
|
|
$
1.60
|
Diluted
|
|
1.95
|
|
1.60
|
Weighted Average Number of Common
Shares:
|
|
|
|
|
Basic
|
|
358,609
|
|
358,147
|
Diluted
|
|
359,180
|
|
358,817
|
CME Group Inc. and
Subsidiaries
|
Quarterly Operating
Statistics
|
|
|
|
1Q
2021
|
|
2Q
2021
|
|
3Q
2021
|
|
4Q
2021
|
|
1Q
2022
|
Trading
Days
|
|
61
|
|
63
|
|
64
|
|
64
|
|
62
|
Quarterly Average
Daily Volume (ADV)(1)
|
CME Group ADV (in
thousands)
|
|
Product
Line
|
|
1Q
2021
|
|
2Q
2021
|
|
3Q
2021
|
|
4Q
2021
|
|
1Q
2022
|
Interest
rates
|
|
10,349
|
|
8,581
|
|
8,111
|
|
9,805
|
|
12,484
|
Equity
indexes
|
|
6,117
|
|
4,926
|
|
5,100
|
|
5,943
|
|
7,950
|
Foreign
exchange
|
|
852
|
|
769
|
|
776
|
|
800
|
|
904
|
Energy
|
|
2,363
|
|
1,963
|
|
2,179
|
|
2,252
|
|
2,515
|
Agricultural
commodities
|
|
1,471
|
|
1,631
|
|
1,141
|
|
1,216
|
|
1,474
|
Metals
|
|
675
|
|
568
|
|
480
|
|
475
|
|
593
|
Total
|
|
21,827
|
|
18,438
|
|
17,786
|
|
20,490
|
|
25,920
|
Venue
|
|
|
|
|
|
|
|
|
|
|
CME Globex
|
|
20,436
|
|
17,223
|
|
16,652
|
|
19,043
|
|
24,060
|
Open outcry
|
|
678
|
|
646
|
|
598
|
|
792
|
|
1,030
|
Privately
negotiated
|
|
713
|
|
569
|
|
536
|
|
656
|
|
830
|
Total
|
|
21,827
|
|
18,438
|
|
17,786
|
|
20,490
|
|
25,920
|
Quarterly Average
Rate Per Contract (RPC)(1)
|
CME Group
RPC
|
|
Product
Line
|
|
1Q
2021
|
|
2Q
2021
|
|
3Q
2021
|
|
4Q
2021
|
|
1Q
2022
|
Interest
rates
|
|
$
0.475
|
|
$
0.491
|
|
$
0.483
|
|
$
0.487
|
|
$
0.484
|
Equity
indexes
|
|
0.532
|
|
0.555
|
|
0.555
|
|
0.526
|
|
0.526
|
Foreign
exchange
|
|
0.779
|
|
0.805
|
|
0.803
|
|
0.779
|
|
0.800
|
Energy
|
|
1.097
|
|
1.140
|
|
1.127
|
|
1.111
|
|
1.124
|
Agricultural
commodities
|
|
1.343
|
|
1.343
|
|
1.319
|
|
1.323
|
|
1.378
|
Metals
|
|
1.415
|
|
1.438
|
|
1.463
|
|
1.452
|
|
1.482
|
Average RPC
|
|
$
0.658
|
|
$
0.695
|
|
$
0.677
|
|
$
0.650
|
|
$
0.644
|
|
|
|
|
|
|
|
|
|
|
|
1. ADV and RPC includes
futures and options on futures only.
|
|
|
CME Group Inc. and Subsidiaries
|
Reconciliation of GAAP to non-GAAP
Measures
|
(dollars in millions,
except per share amounts; shares in thousands)
|
|
|
|
|
|
|
|
Quarter Ended
March 31
|
|
|
2022
|
|
2021
|
Net Income Attributable to CME
Group
|
|
$ 711.0
|
|
$
574.4
|
Restructuring and
severance
|
|
3.7
|
|
14.8
|
Amortization of
purchased intangibles(1)
|
|
69.8
|
|
60.6
|
Strategic
transaction-related costs(2)
|
|
1.6
|
|
10.2
|
Foreign exchange
transaction (gains) losses
|
|
(4.3)
|
|
2.4
|
Unrealized and realized
gains on investments
|
|
(4.0)
|
|
(1.3)
|
Debt costs related to
refinancing
|
|
7.7
|
|
—
|
Realized and unrealized
losses on assets
|
|
—
|
|
0.8
|
Trading floor
enhancements
|
|
4.4
|
|
—
|
Income tax effect
related to above
|
|
(15.8)
|
|
(20.7)
|
Other income tax
items(3)
|
|
(7.9)
|
|
—
|
Adjusted Net Income Attributable to CME
Group
|
|
$ 766.2
|
|
$
641.2
|
|
|
|
|
|
Adjusted Net Income Attributable to Common
Shareholders of CME Group
|
|
$ 756.6
|
|
$
641.2
|
|
|
|
|
|
Earnings per Share Attributable to Common
Shareholders of CME Group:
|
Basic
|
|
$
1.96
|
|
$
1.60
|
Diluted
|
|
1.95
|
|
1.60
|
|
|
|
|
|
Adjusted Earnings per Share Attributable to Common
Shareholders of CME Group:
|
Basic
|
|
$
2.11
|
|
$
1.79
|
Diluted
|
|
2.11
|
|
1.79
|
|
|
|
|
|
Weighted Average Number of Common
Shares:
|
|
|
|
|
Basic
|
|
358,609
|
|
358,147
|
Diluted
|
|
359,180
|
|
358,817
|
Preferred
shares(4)
|
|
4,584
|
|
—
|
|
|
|
|
|
1. Includes $11.4
million of amortization of purchased intangibles (net of tax) at
OSTTRA, reported in Equity in net earnings of unconsolidated
subsidiaries.
|
2. Strategic
transaction-related costs primarily include professional fees
related to the NEX integration.
|
3. Other income tax
items include benefits recognized for the settlement of various tax
audits.
|
4. Preferred shares
have similar rights as common shares without voting
rights.
|
Media
contact
|
Investor
contact
|
Chris Grams,
312.930.3435
|
John Peschier,
312.930.8491
|
Laurie Bischel,
312.648.8698
|
|
news@cmegroup.com
|
|
www.cmegroup.mediaroom.com
|
|
CME-G
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SOURCE CME Group