On Thursday, Deutsche Börse AG published its figures for the second quarter of 2011. Compared to the same period in the previous year earnings before interest and tax (EBIT) rose by 7 percent to €276.5 million. The Group’s total costs decreased to €289.2 million, 19 percent below the costs in the previous year. Sales revenue amounted to €528.6 million, 6 percent lower than in the second quarter last year, when trading volumes were particularly high due to market volatility. Earnings per share climbed 11 percent to €0.96 compared to the previous year.
Sales revenue for the first half of the year rose slightly compared with the prior year, from €1,083.6 million in H1/2010 to €1,087.2 million in the first six months of 2011. Total costs in the first half of 2011 amounted to €560.5 million, a year-on-year decline of 14 percent. As a result, EBIT improved by 18 percent to €592.8 million and earnings per share rose by 23 percent to €2.10.
Gregor Pottmeyer, Deutsche Börse AG’s CFO and Executive Board member for Human Resources: “We maintained our rigorous cost discipline in the second quarter of 2011, enabling us to further optimize costs for the half-year period. Coupled with a slight rise in sales revenue, this increased earnings significantly in the first half of 2011.”
Results for Q2/2011
Sales revenue for Deutsche Börse Group in the second quarter of 2011 amounted to €528.6 million. This corresponds to a decline of 6 percent as against the second quarter of 2010 (Q2/2010: €564.4 million). The decrease in sales revenue is primarily attributable to lower equity market volatility year-on-year. In the second quarter of 2010, government debt levels in certain European countries and the decline of the euro against the US dollar dominated market activity. In addition to sales revenue, the Group generated net interest income from banking business of €18.5 million, up 18 percent year-on-year (Q2/2010: €15.7 million). The increase is due to the slight rise in short-term interest rates in the euro zone and higher overnight customer deposits year-on-year. Other operating income in the second quarter of 2011 amounted to €12.9 million as opposed to €24.6 million in the prior-year quarter. In the second quarter of 2010, this figure had included a contribution of €8.4 million that was mostly due to an adjustment to the term of the investment portfolio for Clearstream’s own funds.
At €289.2 million, total costs were down 19 percent year-on-year (Q2/2010: €356.0 million). The decline is mainly attributable to lower year-on-year depreciation and amortization in the second quarter of 2011 as well as to special factors relating to the implementation of efficiency measures in the second quarter of 2010. Total costs in the second quarter of 2011 comprise cost for efficiency measures of €–2.6 million resulting from a partial release of 2010 provisions that are not required anymore (Q2/2010: €82.0 million) and costs of €18.8 million in relation to the planned business combination with NYSE Euronext. Volume-related costs amounted to €53.6 million in the reporting period and operating costs to €235.6 million.
At €5.7 million, the result from equity investments was down year-on-year (Q2/2010: €8.7 million). It was generated primarily by European Energy Exchange AG and Scoach Holding S.A. in the reporting period. As a result, Deutsche Börse Group generated total earnings before interest and tax (EBIT) of €276.5 million, up 7 percent on the second quarter of 2010 (Q2/2010: €257.4 million).
The financial result for the second quarter of 2011 of €–17.2 million reflects in particular interest payments in connection with noncurrent liabilities. The interest coverage ratio in the second quarter stood at 17.5. The effective Group tax rate in the second quarter of 2011 was 28.9 percent (Q2/2010: 27.0 percent), since the non-deductible costs relating to the proposed business combination with NYSE Euronext led to an increase in the tax base. Adjusted for this effect, the tax rate in the second quarter amounted to 26.0 percent. Non-controlling interests in net income for the period – the item indicating the share of the profit or loss of subsidiaries attributable to minority shareholders – amounted to €–5.5 million for the quarter (Q2/2010: €–5.3 million).
Consolidated net income for the second quarter of 2011 rose by 11 percent to €178.8 million, up from €160.8 million in the second quarter of 2010. Based on a weighted average of 186.0 million shares outstanding, basic earnings per share rose by 11 percent in the second quarter of 2011, to €0.96 (Q2/2010: €0.87 for an average of 185.9 million shares outstanding). The cash flow from operating activities in the second quarter amounted to €249.1 million compared to €150.9 million in the same period last year.
Results for H1/2011
Aggregate sales revenue for the first six months of 2011 amounted to €1,087.2 million (H1/2010: €1,083.6 million). Total costs amounted to €560.5 million (H1/2010: €654.8 million, down 14 percent). Adjusted for restructuring expenses and merger related costs, they amounted to €530.7 million, a year-on-year decline of 3 percent (H1/2010: €545.0 million). EBIT for the first half year stood at €592.8 million (H1/2010: €503.0 million, up 18 percent). Consolidated net income for the period amounted to €391.6 million in the first six months of 2011, compared with €317.7 million in the prior-year period, an increase of 23 percent. Basic earnings per share amounted to €2.10 (H1/2010: €1.71, up 23 percent).