10-Q/APeriod: Q3 FY2012

Cboe Global Markets, Inc. Quarterly Report (Amendment) for Q3 Ended Sep 30, 2012

Filed May 2, 2013For Securities:CBOE

Summary

Cboe Global Markets, Inc. (CBOE) reported its financial results for the nine months ended September 30, 2012, showcasing resilience despite a challenging market environment. Total operating revenues saw a slight decrease of 1.4% to $382.3 million, primarily driven by a decline in transaction and access fees. However, this was partially offset by significant growth in exchange services, market data fees, and other revenues. Net income allocated to common stockholders increased by 10.2% to $116.0 million, demonstrating effective cost management and strategic initiatives. The company maintained a strong market share of 28.4% in exchange-traded options contracts, an increase from the prior year, attributed to implemented fee changes and incentive programs. CBOE also continued to invest in its infrastructure, including the migration of its trading platform, while actively managing its capital through dividend payments and a robust share repurchase program, returning value to shareholders. The company's liquidity remains solid, supported by cash generated from operations.

Financial Highlights

41 data points
Beta

Revenue

$128.32M

Net Income

$45.76M

35.7% Net Margin

EPS (Diluted)

$0.52

Total Assets

$377.53M

Cash & Equivalents

$160.28M

Free Cash Flow

$54.13M

Financial Statements
Beta
Revenue$128.32M
Operating Expenses$67.46M
Operating Income$60.86M
Net Income$45.76M
EPS (Basic)$0.52
EPS (Diluted)$0.52
Shares Outstanding (Basic)87.27M
Shares Outstanding (Diluted)87.27M

Key Highlights

  • 1Net income allocated to common stockholders increased by 10.2% to $116.0 million for the nine months ended September 30, 2012, compared to $105.3 million in the prior year.
  • 2Total operating revenues for the nine months ended September 30, 2012, were $382.3 million, a decrease of 1.4% from $387.9 million in the prior year, mainly due to lower transaction and access fees.
  • 3CBOE's market share of total exchange-traded options contracts increased to 28.4% for the nine months ended September 30, 2012, up from 26.7% in the same period last year.
  • 4Operating expenses decreased slightly by 0.6% to $197.9 million for the nine months ended September 30, 2012, reflecting cost management efforts.
  • 5The company repurchased $49.7 million of its common stock under its share repurchase program during the nine months ended September 30, 2012, and paid $34.6 million in dividends.
  • 6Cash and cash equivalents increased by $25.4 million to $160.3 million at September 30, 2012, from $134.9 million at December 31, 2011, indicating healthy operational cash generation.
  • 7Significant growth was observed in 'Exchange services and other fees' (71.1%) and 'Market data fees' (27.7%) for the nine months ended September 30, 2012.

Frequently Asked Questions

For the nine months ended September 30, 2012, CBOE's total operating revenues were $382.3 million, a slight decrease of 1.4% compared to $387.9 million in the same period of 2011. This was primarily due to lower transaction fees and access fees, although this decline was partially offset by increases in exchange services and other fees, market data fees, and other revenue.

CBOE actively engaged in its share repurchase program. For the nine months ended September 30, 2012, the company purchased approximately $49.7 million of its common stock. This activity, along with dividend payments totaling $34.6 million, reflects the company's commitment to returning capital to shareholders.

CBOE demonstrated effective expense management. Total operating expenses for the nine months ended September 30, 2012, decreased by 0.6% to $197.9 million compared to $199.0 million in the prior year. Key drivers of this decrease included lower trading volume incentives and royalty fees, despite increases in outside services and employee costs.

CBOE maintained a strong liquidity position. Cash and cash equivalents stood at $160.3 million as of September 30, 2012, an increase of $25.4 million from $134.9 million at the end of 2011. This increase was mainly due to cash generated from operations, partially offset by tax payments, stock repurchases, and dividend payments.