NYX Nyse Euronext

NYSE Euronext (NYX) said Monday that tough economic conditions will keep the exchange operator under pressure as it reported a 44% net profit decline in the first quarter, driven by a drought in trading.

Revenue from trading fees fell by one-quarter from the year-earlier period as investors remain on the sidelines of stock markets in the U.S. and Europe, while currency losses and charges from the failed merger with Germany's Deutsche Boerse AG (DB1.XE) also weighed on results.

"We knew and expected this would be a challenging quarter for us, given the difficult environment," said Duncan Niederauer, chief executive of NYSE Euronext, on a conference call Monday.

Niederauer said he saw a "more normal environment" potentially returning in 2013 or 2014.

For the first quarter of 2012, NYSE Euronext's net profit fell to $87 million from $155 million a year earlier, while revenue slipped to $601 million from $679 million. Operating earnings per share were 47 cents, undershooting analysts' expectation of 48 cents a share.

First-quarter net revenue from the exchange's derivatives unit was $176 million, down 25% from a year earlier, including a $3 million hit from currency losses. The company attributed the revenue fall to lower trading volume and reduced pricing for individual equity options and index futures.

Revenue related to information services and technological solutions increased 4% in the first quarter to $121 million. The company, which collects fees in U.S. dollars, euros and pounds sterling, took a $2 million hit from currency fluctuations over the quarter.

The company declared a cash dividend of 30 cents a share for the second quarter.

NYSE Euronext said it bought back 4.3 million shares at an average price of $29.73 a share in the first quarter.

Following its failed tie-up with Deutsche Boerse, NYSE Euronext is launching a revamped two-year standalone plan aimed at cutting costs and lifting profit. The EU blocked the merger earlier this year on antitrust grounds, as the would-be new company would have had a dominant 93% share of Europe's on-exchange derivatives business.

NYSE Euronext said costs for the quarter were down 3% as it looked to "streamline" its operation. Those efforts have included exiting some investments, including a joint venture to develop U.S. and Asian carbon markets.

-By Jacob Bunge, Dow Jones Newswires; 312-750-4117; jacob.bunge@dowjones.com

-By Noemie Bisserbe, Dow Jones Newswires; +33-1-4017-1756; noemie.bisserbe@dowjones.com

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