The FINANCIAL — Intercontinental Exchange on October 28 reported financial results for the third quarter of 2015. For the quarter ended September 30, 2015, consolidated net income attributable to ICE was $306 million on $816 million of consolidated revenues less transaction-based expenses. On a GAAP basis, diluted earnings per share (EPS) in the third quarter were $2.76.
ICE’s operating results include amortization of acquisition-related intangibles, acquisition and integration-related expenses and other adjustments that are not reflective of ICE’s cash operations or core business performance. Excluding these items, net of tax, third quarter 2015 adjusted net income from continuing operations was $323 million and adjusted diluted EPS from continuing operations were $2.91, an increase of 24% over the prior third quarter, according to Intercontinental Exchange.
“Our third quarter performance represents our fourth consecutive quarter of double-digit earnings growth. This was driven by strong performance in our commodities, cash equities, data services and listings businesses,” said ICE Chairman and CEO Jeffrey C. Sprecher. “Our focus on our customers and on our strategic objectives is providing near-term and long-term growth across all of our businesses.”
Scott A. Hill, ICE CFO, said: “We drove growth through a range of organic initiatives, while continuing to reduce expenses and expand operating margins. We also generated strong cash flow and maintained a strong balance sheet with low leverage which enabled us to return $847 million to shareholders through dividends and share repurchases during the first nine months of the year.”
Third Quarter 2015 Results
Third quarter 2015 consolidated revenues, less transaction-based expenses, increased 10% to $816 million compared to the same period in 2014. Included in this amount are $460 million of transaction and clearing revenues, less transaction-based expenses.
Consolidated data services revenues for the third quarter of 2015 were a record $209 million, up 24% year-over-year and listings revenues were $101 million, up 10% compared to the prior third quarter. Consolidated other revenues were $46 million.
Consolidated operating expenses were $376 million for the third quarter of 2015, including $6 million in NYSE integration costs. Consolidated operating income for the third quarter was $440 million and operating margin was 54%. The effective tax rate for the third quarter was 27%.
First Nine Months of 2015 Results
Consolidated revenues, less transaction-based expenses, for the first nine months of the year increased 7% to $2.5 billion compared to the same period in 2014. Included in this amount are $1.4 billion of transaction and clearing revenues, less transaction-based expenses.
Consolidated data services revenues for the first nine months of 2015 were a record $614 million, up 22% year-over-year and listings revenues were a record $303 million, up 11% compared to the prior period. Consolidated other revenues were $132 million.
Consolidated operating expenses were $1.1 billion for the first nine months of 2015, including $31 million in NYSE integration costs. Consolidated operating income for the first nine months of 2015 was $1.3 billion and operating margin was 54%. The effective tax rate for the first nine months was 27%.
Consolidated cash flows from operations were $890 million for the first nine months of 2015. Operational capital expenditures were $70 million and capitalized software development costs totaled $67 million.
Unrestricted cash and short-term investments were $708 million and outstanding debt was $3.5 billion as of September 30, 2015.
ICE expects fourth quarter 2015 adjusted operating expenses in the range of $330 million to $335 million.
ICE’s diluted share count for the fourth quarter and full year 2015 is expected to be in the range of 110 million to 112 million weighted average shares outstanding, including share repurchases through October 2015 and excluding any shares issued for the Interactive Data Corporation acquisition (IDC), which is expected to close in December 2015 or January 2016.