CME Group Profit Soars on Volume, Data Growth

By Lisa Beilfuss 

CME Group Inc., the world's biggest futures-market operator, said profit soared in its third quarter, lifted by higher trading volume and growth in the company's market data and information services business.

The company's results easily beat Wall Street's expectations.

CME recently closed most of its trading pits in New York and Chicago as traders increasingly execute buy and sell orders electronically. Chief Executive Phupinder Gill said that in the third quarter, CME saw its highest percentage of volume traded electronically.

While many firms have reported that tumultuous markets cut into third-quarter earnings, CME benefited from busier markets--spooked by growth concerns and a slowdown in China. Total trading volume during the period rose 7%. Mr. Gill said the company hit record levels of options volume and saw double-digit growth across commodities contracts.

Equity volume snapped its decline and jumped 27%, while energy volume rose 26% and foreign exchange volume gained 7.3%. Strength in those product lines offset a 7.3% drop in interest-rate volume. Interest-rate contracts account for nearly half of CME's overall exchange volume.

CME has been working to grow its international presence, and global activity reached a record 32% during the quarter.

The exchange operator said the total average rate per contract rose 4.7% to 75.9 cents, thanks to a higher proportion of total volume coming from commodities products; commodities products generate higher average fees. Clearing and transaction fees grew 11% to $715 million.

Revenue from market data, meanwhile, increased 13%. Earlier this week, rival exchange operator Intercontinental Exchange Inc., owner of the New York Stock Exchange, agreed to buy financial-data provider Interactive Data Corp. for $5.2 billion, a move to beef up its fast-growing data business.

Overall, CME reported a profit of $359.9 million, or $1.06 a share, up from $290 million, or 86 cents, a year earlier. Excluding certain items, earnings per share rose to $1.02 from 84 cents. Revenue grew 12% to $850.3 million. Analysts projected 99 cents in per-share profit on $853.1 million in revenue, according to Thomson Reuters.

Shares in the company, up about 8% this year, were inactive premarket.

Write to Lisa Beilfuss at [e-mail]

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(END) Dow Jones Newswires

October 29, 2015 07:57 ET (11:57 GMT)

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