- 12% Increase in ADV for 3Q08 Futures Volume; 26% Increase for September on 101% Total Volume Growth for Record Month at ICE Futures U.S.
- 25% Increase in 3Q08 OTC Commissions; 8% Increase in September
- $16 million in Creditex Broker Revenues in September, up 45%
IntercontinentalExchange (NYSE: ICE), a leading operator of regulated global futures exchanges and over-the-counter (OTC) markets, today reported growth in volume and commissions for the month of September and the third quarter of 2008.
Global Futures Exchanges
ICE operates three regulated futures exchanges: ICE Futures Europe(TM), ICE Futures U.S.(TM), and ICE Futures Canada(TM). Third quarter 2008 average daily volume (ADV) for all ICE Futures contracts reached 859,464, up 12% compared to last year's third quarter. ADV for all ICE Futures contracts during the month of September 2008 rose 26% to 1,072,163 compared to 853,862 contracts in September 2007.
Year-to-date through September 30, 2008, ADV for ICE Futures contracts increased 20% to 919,254, compared to the same period in 2007. ADV for ICE Futures Europe, ICE Futures U.S. and ICE Futures Canada has increased 12%, 40% and 8%, respectively, compared to the first nine months of 2007.
European Futures Volume and RPC
ICE Futures Europe is ICE's London-based energy futures exchange. For September, ICE Futures Europe reported its second highest monthly total ever with volume of 13,848,425 contracts, a 16% increase from 11,973,011 contracts in September 2007. ADV was 629,474, up 5% from ADV of 598,651 the prior September. The ICE Gas Oil contract achieved record volume and ADV during September, and the ICE Brent Crude futures contract had the second highest monthly volume in exchange history. In the third quarter of 2008, ADV at ICE Futures Europe totaled 568,761 contracts, an increase of 3% over the third quarter of 2007.
The three-month rolling rate per contract (RPC) for the third quarter of 2008 was $1.22. RPC averaged $1.22 and $1.21 for the three months ended August 2008 and July 2008, respectively. RPC is calculated by dividing transaction revenues by contract volume, and can vary based on pricing, customer and product mix.
On September 30, 2008, open interest for ICE Futures Europe was 1,970,801 contracts, compared to 1,641,399 contracts at December 31, 2007. Open interest reached an all-time high of 2,020,659 on September 16, 2008.
North American Futures Volume and RPC
ICE's agricultural, soft commodity, financial and index futures trade on ICE's U.S. and Canadian futures exchanges. Total volume at ICE Futures U.S. increased 101% to a record 9,264,826 contracts in September 2008, compared to 4,615,469 contracts in September 2007. September 2008 ADV rose 78%, to 431,465 contracts, compared with 241,898 contracts in September 2007. In the third quarter of 2008, ADV at ICE Futures U.S. totaled 281,177, an increase of 35% over the prior third quarter.
The three-month rolling RPC for the second quarter of 2008 was $2.22 for agricultural futures and options. RPC averaged $2.23 and $2.22 for the three months ended August 2008 and July 2008, respectively. Third quarter 2008 RPC for ICE Futures U.S. financial futures and options contracts averaged $1.16. With the transition of the Russell Index futures and options contracts to exclusive trading on ICE in September 2008, RPC for financial futures, including indexes and foreign exchange contracts, is now being provided.
On September 30, 2008, open interest for ICE Futures U.S. was 3,474,308 contracts, compared to 3,389,923 contracts at December 31, 2007.
ICE Futures Canada recorded September 2008 volume of 235,715 contracts, down 7% from September 2007. ADV was 11,224, a decrease of 16% from the prior September. In the third quarter of 2008, ADV at ICE Futures Canada totaled 9,526 contracts, a decrease of 7% over the prior third quarter. On September 30, 2008, open interest for ICE Futures Canada was 109,314 compared to 168,928 contracts on December 31, 2007.
ICE Futures: Rolling Three-Month Average Rate per Contract Product Line Three Months Three Months Three Months Ending Ending Ending September 2008 August 2008 July 2008 ICE Futures Europe $1.22 $1.22 $1.21 ICE Futures U.S. Ag $2.22 $2.23 $2.22 ICE Futures U.S. Fin $1.16 n/a n/a
Global OTC Markets
ICE operates global over-the-counter markets for both energy markets and credit default swap (CDS) products. In the OTC energy markets, average daily commissions for the first nine months of 2008 were $1.2 million, up 52% over the same period in 2007. In the CDS markets, which are operated by Creditex, year-to-date pro-forma broker revenues through September 30, 2008 were $135 million. ICE acquired Creditex on August 29, 2008 and will include financial results for the month of September only in its consolidated third quarter earnings results.
Energy:
For September 2008, ICE's average daily commissions were $1.1 million, an increase of 8% compared to $975,828 in September 2007. For the third quarter of 2008, average daily commissions totaled $1.1 million, an increase of 25% over the prior third quarter. Average daily commissions reflect daily trading activity in ICE's global OTC energy markets.
CDS:
For the month of September, Creditex produced approximately $16 million in brokerage revenue, up 45% versus September of 2007. ICE will report brokerage revenues for Creditex on a quarterly basis following the end of the third month of each quarter.
Additional September 2008 Information and Guidance Update:
- ICE Clear Europe expects to announce an updated clearing transition date in the near term. Since the planned transition date of September 15, the CPS system built for ICE Clear Europe has been used by LCH.Clearnet. Accordingly, a key phase of the technical transition has been completed. The final transition of positions was delayed due to the default of a member firm.
- ICE provides updated information for the following guidance metrics:
- For the third quarter of 2008, specifically, ICE expects earnings per share dilution of approximately $0.01 to $0.03 based on both the Creditex transaction and ICE's share repurchase activity.
- ICE reiterates the following guidance metrics as provided on its
September 12, 2008 conference call related to the closing of its
Creditex acquisition:
- ICE expects non-cash compensation for the second half of 2008 to be in the range of $20 million to $24 million, assuming certain full year performance targets are achieved.
- Including amortization of intangibles relating to Creditex, ICE expects full year 2008 depreciation and amortization expense to be in the range of $61 million to $65 million. The full year expense includes $9 million for amortization of Creditex intangibles.
- ICE's consolidated tax rate is expected to be in the range of 35% to 38% for full year 2008.
- ICE forecasts the diluted share count for the third quarter of 2008 to be in the range of 72 million to 73 million weighted average shares outstanding, and the diluted share count for fiscal year 2008 to be in the range of 72 million to 73 million weighted average shares outstanding.
- As a result of the share repurchase program initiated at the close of the Creditex transaction, ICE expects incremental net interest expense to be approximately $10 million to $12 million annually due to the drawing down of an existing line of credit and reduced interest income resulting from lower cash on hand.
- Trading days in September 2008:
- ICE Futures Europe: 22
- ICE Futures U.S. Agricultural: 21
- ICE Futures U.S. Currency and Index: 22
- ICE Futures Canada: 21
- ICE OTC: 21
- ICE Futures Europe product records achieved for the month of September:
- An exchange-wide open interest record of 2,020,659 was set on September 16.
- The ICE Gas Oil contract achieved record monthly volume of 2,997,149 during September and record ADV of 136,234.
- ICE Futures U.S. product records achieved for the month:
- On September 16, exchange-wide volume reached a new all-time high, surpassing 800,000 contracts for the first time in a single day. Volume totaled a record 841,938 contracts.
- The mini Russell 2000(R) Index futures contract set a monthly record of 3,818,506 contracts, including a daily record of 500,394 contracts on September 16.
- Open interest records were established in both the mini Russell 1000(R) and mini Russell 2000 Index futures and options contracts, signifying the successful transition to ICE as the exclusive trading venue for U.S. Russell index futures and options contracts on September 19.
- US Dollar Index(R) futures set a new monthly record of 308,349 contracts and a daily record on September 10 of 47,545 contracts. Open interest in the contract also reached a new high.
ICE Futures: September 2008 Average Daily Volume by Product ADV ADV ADV Product Line September September % Change 2008 2007 ICE Brent Crude futures 270,900 249,464 8.6 ICE WTI Crude futures 201,769 221,222 -8.8 ICE Gas Oil futures 136,234 115,025 18.4 Other contracts (1) 20,571 12,940 59.0 Total ICE Futures Europe 629,474 598,651 5.1 Sugar No. 11 futures & options 151,166 130,498 15.8 Other agricultural commodity contracts (2) 76,249 91,996 -17.1 Currency futures (3) 10,791 9,487 13.7 Index futures (4) 190,237 9,384 1927.2 Other contracts (5) 3,022 533 467.3 Total ICE Futures U.S. 431,465 241,898 78.4 Total ICE Futures Canada (6) 11,224 13,313 -15.7 TOTAL FUTURES CONTRACTS 1,072,163 853,862 25.6
(1)"Other contracts" include ICE Middle East Sour Crude futures; ICE Heating Oil futures; ICE Unleaded Gasoline Blendstock (RBOB) futures; ICE UK Natural Gas futures; ICE-ECX CFI futures; ICE-ECX CFI CER futures; ICE UK Electricity futures; ICE Coal futures; ICE Brent options; ICE WTI options, ICE Gas Oil options; ICE-ECX CFI options and ICE-ECX CFI CER options. The ICE-ECX CFI futures and options contracts and the ICE-ECX CFI CER futures and options contracts are the result of a cooperative relationship between ICE Futures Europe and the Chicago Climate Exchange, Inc. and its subsidiary, the European Climate Exchange. ICE Futures Europe shares in the revenue derived from the ECX CFI and ECX CER futures and options contracts.
(2) "Other agricultural commodity contracts" include futures and/or options for Cocoa, Coffee "C", Cotton No. 2, Orange Juice, and Sugar No. 14.
(3) "Currency futures" include futures for foreign exchange products.
(4) "Index futures" include futures for the US Dollar Index, Russell 2000, Russell 2000 mini, Russell 1000, Russell 1000 mini, the Continuous Commodity Index, the Euro Index, and the NYSE Composite.
(5) "Other contracts" include options on foreign exchange futures and options on index futures.
(6) "ICE Futures Canada" includes futures and options for Canola, Feed Wheat and Western Barley.
Monthly RPC, OTC commissions and broker revenues are estimated using best available current information. Final figures are reported in ICE's quarterly and annual filings with the Securities and Exchange Commission.
Historical futures volume and OTC commission data can be found at: http://ir.theice.com/supplemental.cfm