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Q3 2007 was the most successful quarter in the history of Deutsche Börse to date. The result was up significantly on both the figures for the same quarter of 2006 and those for Q2 2007, the company’s most successful quarter thus far. Sales revenue for Q3 2007 rose by 30 percent as against Q3 2006 to €561.9 million (Q3/2006: €432.0 million). Furthermore, the company reported net interest income from banking business totaling €59.2 million.
Costs amounted to €274.5 million in Q3, including provisions for stock performance related incentive schemes of around €12 million. EBITA increased by 44 percent as against the prior-year quarter to €368.3 million (Q3/2006: €255.0 million). Based on an average of 194.3 million outstanding shares, earnings per share for Q3 increased by 40 percent to €1.23 (Q3/2006: €0.88 based on 198.4 million shares).
Sales revenue in the first nine months of 2007 increased by 19 percent to €1,647.5 million (Q1-3/2006: €1,387.8 million); an additional €167.3 million (Q1-3/2006: €108.7 million) was generated in the form of net interest income from the banking business. EBITA climbed by 23 percent to €990.4 million (Q1-3/2006: €803.4 million). EPS rose by 26 percent to total €3.30 (Q1-3/2006: €2.62).
Deutsche Börse CFO Thomas Eichelmann commented, “Strong growth in business activity paired with cost discipline contributed to these excellent results for the third quarter. Against the background of strong structural growth drivers across all business areas, as well as positive effects from the restructuring and efficiency program, we expect to achieve a new record result in 2008.”
In mid-September, Deutsche Börse had forecast total costs of €1,130 million for the 2008 fiscal year, taking into account the positive impact of the company’s restructuring and efficiency program. The forecast did not include the costs that will result from the consolidation of the International Securities Exchange (ISE) in Deutsche Börse Group’s accounts.
Segment reporting
Q3 sales revenues in the Xetra segment rose by 66 percent to €113.4 million (Q3/2006: €68.4 million); the segment result includes the joint venture with SWX – Scoach – for structured products, which was set up on 1 January 2007. This increase in revenue is primarily due to increased trading activity on the Xetra trading platform. The number of transactions on Xetra increased by 98 percent to 48.7 million (Q3/2006: 24.6 million transactions). EBITA climbed by 117 percent to €77.8 million (Q3/2006: €35.8 million).
Q3 sales revenue in the Eurex segment amounted to €189.4 million – an increase of 36 percent as against the previous year (Q3/2006: €139.0 million). This growth is due largely to the 42 percent increase in contract volume. Equity and index derivatives constituted 59 percent of the total contract volume in Q3; while interest derivatives contributed 41 percent. EBITA climbed by only 13 percent to €126.4 million (Q3/2006: €111.9 million), because the third quarter of 2006 included extraordinary income of approximately €24 million from the sale of 70 percent of the shares in, and the deconsolidation of Eurex US. If the EBITA is adjusted to reflect this amount, it rose by 44 percent.
Sales revenues in the Clearstream segment (not including net interest income from the banking business) rose by 15 percent to €193.0 million (Q3/2006: €167.6 million). Higher volumes in the custody business and in settlement were the biggest contributing factor. In addition, net interest income from the banking business totaling €59.2 million was posted (Q3/2006: €36.6 million). This considerable increase in net interest income is due to the sustained high level of client liquidity in Q3, rising settlement volumes and higher short-term interest rates compared to the previous year. The safekeeping volume in the custody business was up by 13 percent on the prior year to €10.6 trillion (Q3/2006: €9.3 trillion); settlement instructions increased by 42 percent to 18.6 million instructions (Q3/2006: 13.1 million instructions). Q3 EBITA growth in this segment stood at 49 percent, with EBITA coming in at €116.3 million (Q3/2006: €78.3 million).
The Market Data & Analytics segment also reported very positive revenue development, with sales revenues up by 15 percent to €42.3 million (Q3/2006: €36.7 million). This increase was due, in particular, to new clients and the sale of higher-priced share price and trading data packages for the cash and derivatives markets, as well as growth in the Group’s index products. EBITA in this segment rose by 56 percent to €23.5 million (Q3/2006: €15.1 million).
Q3 external sales revenue in the Information Technology segment amounted to €23.8 million (Q3/2006: €20.3 million). This increase is primarily the result of a higher order volume from existing clients, while the segment also acquired several new clients at the beginning of 2007. EBITA in this segment rose substantially as against 2006 to €29.7 million (Q3/2006: €18.8 million).
