CME Group Inc. Reports Strong First-Quarter 2015 Financial Results

First-quarter 2015 revenues rose 8 percent from first-quarter 2014 and represented second highest quarterly revenue
First-quarter 2015 net income attributable to CME Group and diluted earnings per share both grew more than 15 percent from first-quarter 2014

CME Group Inc. (NASDAQ: CME) today reported revenues of $843 million and operating income of $507 million for the first quarter of 2015. Net income attributable to CME Group was $330 million. GAAP and adjusted diluted earnings per share were $0.98¹.

"We delivered strong revenue growth in the first quarter driven primarily by interest rate, energy and foreign exchange products, with double-digit average daily volume growth coming from Europe and North America and 22 percent growth from Asia," said CME Group Executive Chairman and President Terry Duffy. "Total average daily volume was 15 million contracts, up 10 percent, which was the second highest quarter in our history. We recorded solid revenue growth in our core futures products, swaps clearing and market data. This clearly demonstrates the value of the unparalleled diversity of our product set."

"In addition to globalization, we made progress with our swaps clearing and options business," said CME Group Chief Executive Officer Phupinder Gill. "Interest rate swaps clearing revenue grew 57 percent, and we are seeing additional signs that our 500+ swaps clients are increasing their usage of our core futures products. Options volume reached a record 2.8 million contracts per day during the quarter. Also, the combination of top-line growth and our internal efficiency and productivity enhancements led to significant operating margin expansion and earnings growth during the first quarter."

1. A reconciliation of the non-GAAP financial results mentioned to the respective GAAP figures can be found within the Reconciliation of GAAP to Non-GAAP Measures chart at the end of the financial statements.

First-quarter 2015 average daily volume was 15.0 million contracts, up 10 percent from first-quarter 2014, representing the second-highest quarterly volume, and included average daily volume records in energy and options. Clearing and transaction fee revenues were $708.2 million, up 9 percent compared with first-quarter 2014. Market data revenue was $98 million, up 10 percent. First-quarter 2015 total average rate per contract was 75.3 cents, up from 73.1 cents in fourth-quarter 2014, driven primarily by a higher proportion of total volume coming from commodities products, which have higher average fees.

As of March 31, 2015, the company had $1.8 billion of cash and marketable securities and $2.9 billion of long-term debt. In January, we paid out $671 million in our variable dividend of $2 per share. In March, we paid out $168 million in our regular quarterly dividend of 50 cents per share.

CME Group will hold a conference call to discuss first-quarter 2015 results at 8:30 a.m. Eastern Time today. A live audio Webcast of the call will be available on the Investor Relations section of CME Group's Web site at www.cmegroup.com. An archived recording will be available for up to two months after the call.

CME Group Inc. and Subsidiaries Consolidated Balance Sheets (in millions)

	March 31, 2015		December 31, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	1,694.8	$	1,366.1
Marketable securities	78.8		74.7
Accounts receivable, net of allowance	383.4		341.2
Other current assets (includes $32.0 and $37.0 in restricted cash)	154.8		196.5
Performance bonds and guaranty fund contributions	45,174.2		40,566.8
Total current assets	47,486.0		42,545.3
Property, net of accumulated depreciation and amortization	503.3		508.9
Intangible assets—trading products	17,175.3		17,175.3
Intangible assets—other, net	2,612.5		2,637.4
Goodwill	7,569.0		7,569.0
Other assets (includes $70.1 and $72.4 in restricted cash)	1,782.3		1,805.6
Total Assets	$	77,128.4	$	72,241.5
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable	$	34.0	$	36.9
Other current liabilities	286.9		927.5
Performance bonds and guaranty fund contributions	45,174.2		40,566.8
Total current liabilities	45,495.1		41,531.2
Long-term debt	2,851.9		2,107.9
Deferred income tax liabilities, net	7,299.7		7,302.7
Other liabilities	386.2		376.2
Total Liabilities	56,032.9		51,318.0
CME Group shareholders' equity	21,095.5		20,923.5
Total Liabilities and Equity	$	77,128.4	$	72,241.5

CME Group Inc. and Subsidiaries Consolidated Statements of Income (dollars in millions, except per share amounts; shares in thousands)

	Quarter Ended March 31,
	2015		2014
Revenues
Clearing and transaction fees	$	708.2	$	652.2
Market data and information services	98.0		89.4
Access and communication fees	21.3		20.4
Other	15.2		15.4
Total Revenues	842.7		777.4
Expenses
Compensation and benefits	141.3		135.5
Communications	7.6		8.2
Technology support services	15.6		13.9
Professional fees and outside services	29.1		29.6
Amortization of purchased intangibles	24.9		25.2
Depreciation and amortization	31.8		34.1
Occupancy and building operations	22.8		23.2
Licensing and other fee agreements	30.6		29.0
Other	31.7		24.2
Total Expenses	335.4		322.9
Operating Income	507.3		454.5
Non-Operating Income (Expense)
Investment income	5.7		3.2
Gains (losses) on derivative investments	(1.8)		—
Interest and other borrowing costs	(31.6)		(33.7)
Equity in net earnings (losses) of unconsolidated subsidiaries	22.5		22.4
Other non-operating income (expense)	21.7		—
Total Non-Operating	16.5		(8.1)
Income before Income Taxes	523.8		446.4
Income tax provision	193.4		179.8
Net Income	330.4		266.6
Less: net income (loss) attributable to non-controlling interests	—		(0.2)
Net Income Attributable to CME Group	$	330.4	$	266.8
Earnings per Common Share Attributable to CME Group:
Basic	$	0.98	$	0.80
Diluted	0.98		0.79
Weighted Average Number of Common Shares:
Basic	335,680		333,905
Diluted	337,416		335,644

CME Group Inc. and Subsidiaries Quarterly Operating Statistics

	1Q 2014		2Q 2014		3Q 2014		4Q 2014		1Q 2015
Trading Days	61		63		64		64		61


Quarterly Average Daily Volume (ADV) CME Group ADV (in thousands)

Product Line	1Q 2014		2Q 2014		3Q 2014		4Q 2014		1Q 2015
Interest rate	6,725		6,668		7,181		7,445		7,564
Equity	2,890		2,465		2,586		3,114		2,772
Foreign exchange	817		638		797		959		954
Energy	1,705		1,457		1,562		1,797		2,142
Agricultural commodity	1,168		1,084		1,058		1,173		1,189
Metal	355		323		308		361		369
Total	13,659		12,636		13,493		14,848		14,990
Venue
Electronic	11,703		10,888		11,627		12,982		13,034
Open outcry	1,179		1,100		1,208		1,218		1,291
Privately negotiated	778		647		657		648		665
Total	13,659		12,636		13,493		14,848		14,990


Average Rate Per Contract (RPC) CME Group RPC

Product Line	1Q 2014		2Q 2014		3Q 2014		4Q 2014		1Q 2015
Interest rate	$	0.481	$	0.473	$	0.473	$	0.472	$	0.480
Equity	0.712		0.714		0.687		0.697		0.721
Foreign exchange	0.804		0.861		0.788		0.760		0.831
Energy	1.364		1.298		1.291		1.279		1.250
Agricultural commodity	1.369		1.430		1.362		1.321		1.324
Metal	1.707		1.715		1.707		1.664		1.662
Average RPC	$	0.767	$	0.749	$	0.725	$	0.731	$	0.753

CME Group Inc. and Subsidiaries
Reconciliation of GAAP to Non-GAAP Measures
(dollars in millions, except per share amounts; shares in thousands)

	Quarter Ended March 31, 2015
	Quarter Ended March 31, 2015
GAAP Net Income Attributable to CME Group	$	330.4

Foreign exchange transaction losses¹	10.0

Acquisition-related costs	0.9

Severance	5.5

Loss on derivatives and debt costs for refinancing	2.3

GFI termination fee - net of the portion paid to outside advisers	(22.5)

Income tax effect related to above	2.9

Adjusted Net Income Attributable to CME Group	$	329.5

GAAP Earnings per Common Share Attributable to CME Group:
Basic	$	0.98
Diluted	0.98

Adjusted Earnings per Common Share Attributable to CME Group:
Basic	$	0.98
Diluted	0.98

Weighted Average Number of Common Shares:
Basic	335,680
Diluted	337,416

1.	First-quarter 2015 results included foreign exchange transaction net losses principally related to cash held in British pounds within foreign entities whose functional currency is the U.S. dollar.