10-KPeriod: FY2013

Intercontinental Exchange, Inc. Annual Report, Year Ended Dec 31, 2013

Filed February 14, 2014For Securities:ICE

Summary

Intercontinental Exchange, Inc. (ICE) filed its 2013 Annual Report on Form 10-K on February 13, 2014. This report details the significant impact of the NYSE Euronext acquisition, completed in November 2013, which substantially expanded ICE's global footprint and product offerings across major asset classes like interest rates and equities. The company highlighted its strategy to integrate and leverage these new assets while also planning for the separation and IPO of Euronext and the divestiture of certain NYSE Technologies businesses. Despite a challenging operating environment with regulatory shifts and market volatility, ICE reported progress in its core exchange and clearing operations, underscoring its commitment to technology enhancement and strategic growth through acquisitions.

Financial Highlights

56 data points
Beta

Revenue

$1.73B

Net Income

$254.00M

14.7% Net Margin

EPS (Diluted)

$0.64

Total Assets

$64.42B

Cash & Equivalents

$961.00M

Free Cash Flow

$580.00M

Financial Statements
Beta
Revenue$1.73B
SG&A Expenses$51.00M
Operating Expenses$808.00M
Operating Income$790.00M
Interest Expense$56.00M
Net Income$254.00M
EPS (Basic)$0.65
EPS (Diluted)$0.64
Shares Outstanding (Basic)390.00M
Shares Outstanding (Diluted)395.00M

Key Highlights

  • 1Completion of the $11.1 billion acquisition of NYSE Euronext on November 13, 2013, significantly expanding ICE's global reach and asset class diversification.
  • 2Revenues, less transaction-based expenses, increased by 23% in 2013, largely driven by the inclusion of NYSE Euronext's operations and continued strength in global oil contracts.
  • 3Operating expenses rose by 65% primarily due to the integration costs and ongoing expenses associated with the NYSE Euronext acquisition.
  • 4Net income attributable to ICE Group decreased by 54% in 2013 compared to 2012, impacted by a $190 million impairment loss on the Cetip investment and $51 million expense for early debt payoff.
  • 5The company reported adjusted net income of $646 million and adjusted diluted EPS of $8.17 for 2013, excluding certain non-core items, indicating underlying business growth.
  • 6ICE plans to separate and pursue an Initial Public Offering (IPO) for Euronext in Q2 2014, aiming to use proceeds to pay down debt.
  • 7The company ended 2013 with total debt of $5.1 billion, a substantial increase driven by the financing of the NYSE Euronext acquisition.

Frequently Asked Questions

The most significant event for ICE in 2013 was the completion of its acquisition of NYSE Euronext on November 13, 2013, a $11.1 billion transaction that significantly expanded ICE's global presence and diversified its product offerings across interest rates, equities, and derivatives.

The acquisition substantially boosted ICE's revenues, contributing $284 million to revenues less transaction-based expenses in 2013. However, it also led to a significant increase in operating expenses, including acquisition-related costs, and a reported net income decrease due to acquisition-specific charges, though adjusted earnings indicate underlying operational strength.

ICE plans to separate Euronext from its other businesses and pursue an initial public offering (IPO) for Euronext, which was tentatively expected in the second quarter of 2014. The proceeds from the IPO are intended to be used for debt reduction.

ICE's total debt increased significantly to $5.1 billion by the end of 2013, up from $1.1 billion in 2012, primarily due to the cash component of the NYSE Euronext acquisition financing and subsequent debt issuances to manage liquidity.