01—Abstract
Summary
Summary of the 10-Q filed August 7, 2009. Cited figures are marked; the original filing is the authoritative source.
The NASDAQ OMX Group, Inc. (NDAQ) reported its financial results for the quarter and six months ended June 30, 2009.
Total revenues less liquidity rebates, brokerage, clearance, and exchange fees decreased by 3.4% to $367 milliona in the second quarter compared to the prior year, impacted by foreign exchange. For the first six months, these revenues increased by 11.7% to $735 million, benefiting from operational growth, particularly in derivative trading. Net income for the quarter was $69 million, or $0.33 per diluted share, down from $100 million, or $0.47 per diluted share, in the same period last year.
The company's balance sheet showed total assets of $11.66 billionb and total equity of $4.51 billion as of June 30, 2009. Cash flow from operations remained steady at $224 million for the first six months. The company faced a challenging economic environment, with revenue from U.S. cash equity trading seeing a decline in the second quarter, though derivative trading revenues showed significant growth, bolstered by the inclusion of NASDAQ OMX PHLX's results.
Issuer Services revenue experienced a decrease, largely due to fewer new listings and a decline in the market capitalization of Nordic issuers. The company continued its integration efforts following significant acquisitions in 2008, such as OMX AB and PHLX, which impacted operating expenses. Despite revenue pressures, the company maintained a strong liquidity position and remained compliant with its debt covenants.
02—Key points
Key Highlights
- Revenues less liquidity rebates, brokerage, clearance and exchange fees decreased 3.4% to $367 million for Q2 2009, but increased 11.7% to $735 million for the first six months of 2009 compared to the prior year.
- Net income attributable to NASDAQ OMX for Q2 2009 was $69 million ($0.33/share diluted), down from $100 million ($0.47/share diluted) in Q2 2008.
- Operating expenses decreased 7.6% to $208 million in Q2 2009, primarily due to favorable foreign exchange impacts and cost-saving programs.
- Cash provided by operating activities was $224 million for the first six months of 2009, largely consistent with $220 million in the prior year.
- The company's balance sheet shows total assets of $11.66 billion and total equity of $4.51 billion as of June 30, 2009.
- Significant integration of acquisitions from 2008 (OMX AB, PHLX) continued to influence operating results and expenses.
- The company generated a $5 million loss from the sale of an investment security (Oslo Børs) and an $18 million loss from other unconsolidated investees in the second quarter, impacting profitability.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q2 FY2009, Nasdaq, Inc. kept $0.08.
- Revenue$889.0M100.0%
- Cost of revenue−$522.0M58.7%
- Gross profit$367.0M41.3%
- Operating costs−$208.0M23.4%
- Operating income$159.0M17.9%
- Interest, other & tax−$90.0M10.1%
- Net income$69.0M7.8%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2009filed August 7, 2009Financial Statements
| Revenue | $889.00M |
| Cost of Revenue | $522.00M |
| Gross Profit | $367.00M |
| Operating Expenses | $208.00M |
| Operating Income | $159.00M |
| Interest Expense | $25.00M |
| Net Income | $69.00M |
| EPS (Basic) | $0.11 |
| EPS (Diluted) | $0.11 |
05—Questions
Frequently Asked Questions
How did the company's revenue perform in the second quarter and first six months of 2009 compared to the prior year?
For the second quarter of 2009, revenues less liquidity rebates, brokerage, clearance and exchange fees decreased by 3.4% to $367 million, impacted by foreign exchange. However, for the first six months of 2009, these revenues increased by 11.7% to $735 million, driven by operational growth, particularly in derivative trading and the full inclusion of OMX AB's results.
What was the company's profitability and earnings per share for the period?
Net income attributable to NASDAQ OMX for the second quarter of 2009 was $69 million, or $0.33 per diluted share, a decrease from $100 million, or $0.47 per diluted share, in the same period of 2008. For the first six months, net income was $163 million, or $0.77 per diluted share, down from $220 million, or $1.14 per diluted share, in the comparable period of 2008.
What is the current financial position of the company, particularly regarding assets, liabilities, and cash flow?
As of June 30, 2009, NASDAQ OMX reported total assets of $11.66 billion and total equity of $4.51 billion. Total liabilities stood at $7.15 billion. Cash flow from operating activities for the first six months of 2009 was $224 million, which was relatively stable compared to $220 million in the prior year, indicating sustained operational cash generation.
What were the main factors affecting operating expenses during this period?
Operating expenses decreased by 7.6% to $208 million in the second quarter of 2009, primarily due to a favorable foreign exchange impact of $23 million and ongoing cost-saving initiatives. For the first six months, operating expenses increased by 11.1% to $411 million, largely due to the full inclusion of expenses from the OMX AB business combination and the NASDAQ OMX PHLX acquisition.
06—Continue