NYSE Euronext Announces Third Quarter 2008 Financial Results - Total Revenues Of $1.2 Billion - Progress On Strategic Initiatives And Cost Control - Conference Call, Friday, Oct. 31, 2008 , 8:00a.m. (New York , EST)/1:00p.m. (Paris, CET)

NYSE Euronext (NYX) today reported net income of $174 million for the quarter ended September 30, 2008, or $0.66 per diluted share (including $0.65 from continuing operations and $0.01 from the discontinued operations of GL Trade) as compared to net income of $258 million, or $0.97 per diluted share, for the quarter ended September 30, 2007. Included in the results of operations for the quarter ended September 30, 2007 was a $32 million gain on the sale of the member firm regulatory functions of NYSE Regulation to FINRA, and a $55 million deferred tax benefit related to an enacted reduction of the UK corporate tax rate from 30% to 28%.  These results are presented in accordance with U.S. generally accepted accounting principles (GAAP).

Following the decision to divest our interest in GL Trade, the business of GL Trade is presented as discontinued and the associated results of operations and financial position are reported separately for all periods presented.

“Despite turbulent markets and the global financial crisis, NYSE Euronext produced stable revenues in the third quarter and continued to drive down operating expenses,” said Duncan L. Niederauer, Chief Executive Officer, NYSE Euronext.  “We are delivering on our strategic plan and investing in future opportunities as demonstrated by the September roll-out of NYSE Liffe, our U.S. futures business, and the imminent launch of our two European initiatives, SmartPool and our pan-European MTF.  The past year’s technology upgrade of our trading systems served customers well as NYSE Euronext markets operated with great reliability and provided continuous access to liquidity during an especially volatile period.”

On a pro forma non-GAAP basis, excluding the operations of GL Trade, merger expenses, exit costs and other non-recurring items, net income of NYSE Euronext for the quarter ended September 30, 2008 would have been $192 million, or $0.72 per diluted share, versus non-GAAP net income of $201 million, or $0.75 per diluted share, for the quarter ended September 30, 2007. On the same basis, total revenues for the three months ended September 30, 2008 were $1,159 million, a $164 million or 16% increase as compared to revenues of $995 million for the three months ended September 30, 2007 . Net revenues (defined as total revenues less direct transaction costs comprised of activity assessment, liquidity payments, and routing and clearing fees) for the three months ended September 30, 2008 were $724 million, a $4 million or 1% increase as compared to net revenues of $720 million for the comparable period a year ago. A full reconciliation of these non-GAAP results is included in the attached tables.

Fixed operating expenses from continuing operations (defined as operating expenses less merger expenses and exit costs, direct transaction costs, and excluding regulatory fine income) were $428 million for the quarter ended September 30, 2008 , an $11 million increase as compared to $417 million for the quarter ended September 30, 2007 . Excluding the impact of currency translation, acquisitions and dispositions of businesses, and selected strategic initiatives, fixed operating expenses decreased $36 million, or 9%, year-over-year. A full reconciliation of these non-GAAP results is included in the attached tables.

“We remain focused on reducing fixed costs and delivering the technology savings related to the NYSE Euronext merger,” said Michael S. Geltzeiler, Group Executive Vice President and Chief Financial Officer, NYSE Euronext. “Insourcing our European technology operations as a result of the AEMS acquisition further allows us to better control costs and generate new revenue opportunities.  We are well down the path of integrating Amex into our operations. We expect to exceed the targeted $100 million in savings on the Amex acquisition, and we foresee the bulk of the related integration to be completed by the middle of next year.”

Other Financial Highlights

• Included in the GAAP results for the quarter ended September 30, 2008 were $30 million of pre-tax merger expenses and exit costs (primarily severance charges), as compared to $22 million in the comparable period a year ago.
  
  
• On August 6, NYSE Euronext completed the acquisition of the 50% stake in Atos Euronext Market Solutions (AEMS) previously owned by Atos Origin.   Through this transaction, NYSE Euronext completed the insourcing of its European technology operations which enables full integration of AEMS’s third-party exchange business (referred to as Exchange Solutions) into NYSE Euronext Advanced Trading Solutions.
  
  
• On October 1, in connection with the completion of SunGard’s acquisition of a majority interest in GL Trade, NYSE Euronext received €161.6 million ($227.5 million) from the sale of its 40% ownership stake in GL TRADE to SunGard.
  
  
• On October 1, NYSE Euronext completed its acquisition of the American Stock Exchange^(R) (Amex^(R)), becoming the third largest U.S. options marketplace and enhancing the company’s leadership in ETFs, cash equities, closed-end funds and structured products. A total of 6.8 million shares of NYSE Euronext common stock were issued in this transaction, which is expected to produce annualized run-rate cost savings in excess of $100 million by the end of 2009.
  
  
• Effective upon closing of the Amex transaction on October 1, NYSE Euronext removed the transfer restrictions on approximately 42 million common shares issued in connection with the merger of NYSE and Archipelago. These shares were previously restricted until March 2009.
  
  
• Following the close of the Amex transaction, NYSE Euronext started implementing its previously announced $1 billion stock repurchase program. As of October 29, NYSE Euronext had repurchased 4.7 million shares at an average price of $29.93 per share.
  
  
• On October 29, NYSE Euronext announced its intention to carry out a restructuring plan of its European operations in order to reduce fixed costs. The plan would include a proposed net reduction of approximately 200 headcount by the end of 2009.
  
  
• As of September 30, 2008 , NYSE Euronext had a strong financial position with $1.2 billion of cash, cash equivalents, investment and other securities (including $41 million related to Section 31 fees collected from market participants and due to the SEC ) and $3.2 billion of debt.
  
  
• NYSE Euronext will make a $0.30 quarterly dividend per share payment on December 31, 2008 to shareholders of record as of December 15, 2008 .

Key Business Highlights

• In July, Euronext launched a new incentive pricing package in Europe in order to accommodate its high frequency traders (Pack Epsilon). For the month of September, this program represented approximately 30% of the total trading volume.  This was followed by a fee schedule adaptation on September 1, and on October 1 the introduction of a global pricing program that produces cost-savings for high-volume trading customers who trade on our equities markets globally.
  
  
• NYSE Arca Options introduced its first-of-a-kind complex order book pilot program that allows customers to trade multiple option and equity issues in one innovative order type taking full advantage of NYSE Euronext’s unique multi-asset exchange operations.
  
  
• NYSE Liffe, LLC, the new U.S. futures exchange of NYSE Euronext, was launched on September 8 and announced its new board and management structure, led by Chairman James J. McNulty, the former CME CEO, and Thomas F. Callahan, NYSE Euronext Executive Vice President and Head of U.S. Futures.   In addition, NYSE Liffe has chosen The Options Clearing Corporation (OCC), the world’s largest derivatives clearing organization, as its clearing house.  This clearing function will become operational before the end of the first quarter of 2009.
  
  
• NYSE Euronext’s Universal Trading Platform (UTP), which will debut in the fourth quarter of 2008, is one of the newest and most advanced trading platforms in the industry to provide superior scalability, greater capacity, very low latency and higher speed trading for customers.
  
  
• Upon FSA approval, NYSE Euronext will launch in partnership with BNP Paribas, HSBC and JP Morgan, SmartPool, its new Multilateral Trading Facility (MTF) for block trading on pan-European stocks.  SmartPool offers full anonymity, mix of periodic blind crosses and blind continuous matching period and an open post-trade infrastructure with LCH.Clearnet and EuroCCP acting as central counterparties.  The pricing has been designed in close contact with customers, based on the liquidity of each stock and charged in basis points.  Current NYSE Euronext customers will have access to this new platform without any additional costs, using the same infrastructure as they use for accessing European regulated equities markets.
  
  
• NYSE Euronext will commence operation of NYSE Arca Europe, its MTF for the trading of pan-European most active stocks in the first quarter of 2009, and will use the first release of the UTP.  NYSE Euronext has committed to provide access to its trade feed to all four pan-European clearing providers for its MTF once these Central Counterparties (CCP) have established the necessary interoperability.  Initially, EuroCCP, a wholly-owned subsidiary of the Depository Trust & Clearing Corporation based in London , will act as a CCP, enabling anonymous post-trade processing, providing netting and a full range of risk management services to the pan-European MTF.
  
  
• The NYSE announced the launch of NYSE Market Access Center , a comprehensive investor relations and market intelligence service for senior executives at NYSE-listed companies.
  
  
• The SEC recently approved a revised rule set and advanced trading tools designed to maximize the NYSE’s market quality and competitiveness in today’s increasingly electronic trading environment.  The initiatives further distinguish the NYSE from competitors and provide greater value to customers by enhancing the Exchange’s unique market model with new functionality and benefits including lower price volatility, smaller spreads between best bid and offer, greater price improvement, more active participation by a broader range of market professionals, and overall deeper liquidity.

NYSE Euronext Market Summary

U.S. Cash Equities – NYSE and NYSE Arca
In the company’s U.S. cash markets during the third quarter of 2008, average daily volume was 3.6 billion shares traded, an increase of 16.8% versus the same period last year and the most active quarter ever with 231.8 billion shares traded. NYSE Euronext's U.S. cash exchanges traded more volume than any other U.S. exchange in 99.7% of the individual NYSE-listed issues.

• In September, NYSE Group realized a modest gain from the prior months with a Tape A market share of 42.2%;
  
  
• During the third quarter of 2008, NYSE Group’s market share in Tape C securities reached 20.1% and showed continued growth as compared to 19.0% for the same period a year ago;
  
  
• Year-to-date through September 30, 2008 , NYSE Group traded 632.8 billion shares, up 17% for the same period in 2007.

European Cash Equities – Euronext
NYSE Euronext’s European cash markets experienced average daily volume of 1.6 million trades, an increase of 15.7% versus the same period last year.

• Year-to-date, NYSE Euronext European exchanges experienced an increase of 24.3% in total trade volume.  Trading volume qualifying for Pack Epsilon, the new pricing package for high-frequency traders implemented on July 1, 2008, represented 30% of total trading volume in September.

European Derivatives – Liffe
Liffe traded an average of 3.8 million futures and options contracts, including Bclear, during the third quarter, representing an 10.3% decline from the year ago period; during the prior year third quarter, Liffe trading volumes were at historic highs due to credit market conditions.

• Year-to-date, Liffe traded a total of 813.6 million futures and options contracts, a 12.3% increase from the year ago period.
  
  
• Bclear, Liffe's trade administration and clearing service, processed 145 million contracts year-to-date, surpassing the total number of contracts processed for full year 2007 of 122 million.

US Derivatives – NYSE Arca Options and NYSE Liffe
NYSE Arca Options traded an average daily volume of 1.8 million contracts during the quarter, an increase of 37.6% compared to the year ago quarter.

• Year-to-date through September 30, 2008 and compared to the same period in 2007, NYSE Arca Options continues to outpace broader industry volumes with volume growth of 48.9% versus total consolidated volume growth of 38.3% for the options industry.
  
  
• For equity options trading in the SEC Penny Pilot program, NYSE Arca Options executed 13.9% of all eligible issues in the third quarter, a 5.4% increase since the pilot began in January 2007.
  
  
• With the October 1, 2008 acquisition of the Amex, NYSE Euronext is now the third-largest U.S. equity options marketplace based on number of contracts traded.  The compelling dual market structure provides all customers the choice of price-time priority on NYSE Arca and the Amex’s traditional market-maker model as well as an expanded array of services.
  
  
• NYSE Liffe followed its September 8 launch in the U.S. with solid technology performance and strong volume growth in the trading of 100 oz. gold futures, 5,000 oz. silver futures, options on gold and silver futures, and mini-sized 33.2 oz. gold and 1,000 oz. silver futures. 

Global Listings – NYSE  Euronext’s U.S. and European Exchanges
The recent   addition of the Amex significantly enhances NYSE Euronext’s position as the world’s largest exchange group by number of listings and market capitalization with nearly 4,600 listed issuers and over 6,500 listed issues with total global market capitalization of approximately $24 / €17 trillion as of October 1, 2008, more than four times that of any other exchange group.

• New Listings: In the third quarter, NYSE Euronext markets added 148 new listings, including exchange-traded products, compared with 124 in the same period last year.
  
  
  • Year-to-date, 300 new listings joined NYSE Euronext U.S. and European exchanges.

• IPOs: NYSE Euronext markets attracted 8 initial public offerings (IPOs), compared with 48 IPOs in the same period last year; the decline in IPO market activity was largely attributable to unfavorable market conditions during the period.

• Fast-Path: On July 21, Brazil ’s Companhia Vale do Rio Doce cross-listed on Euronext Paris using the fast-path process, and on July 22 France ’s Suez Environnement began trading on the company’s Paris and Brussels markets.  

Exchange Traded Products (ETFs and ETNs) – NYSE Arca and European markets

• U.S. : In the third quarter, NYSE Arca added 55 ETPs, including 39 ETFs, 5 ETNs, and 11 certificates.  NYSE Arca represents 59% of ETF and ETN assets under management in the U.S. , nearly $353 billion.
  
  
  • Year-to-date, NYSE Arca added a total of 153 Exchange Traded Products, of which 77 were ETFs, 59 were ETNs, and 17 were certificates, and facilitated the IPO of a total 40 ETFs, 58 ETNs , and 11 certificates;
    
    
  • As of September 30, NYSE Arca lists 293 ETFs (14 issuers), 79 ETNs (10 issuers) and 11 certificates (4 issuers) and trades all eligible ETFs and ETNs;
    
    
  • With the Amex, NYSE Arca adds more than 680 ETFs and 90 ETNs, and expands its portfolio of closed-end funds and structured products with approximately 420 Amex listings joining the more than 1,000 issues already listed on the on the company’s U.S. markets.

NYSE Euronext Advanced Trading Solutions – Global Commercial Technology Business

• The acquisition of the remaining 50% stake in Atos Euronext Market Solutions (AEMS) allows NYSE Euronext to fully integrate AEMS into NYSE Euronext Advanced Trading Solutions.
  
  
• Itau Securities selected NYSE Euronext Advanced Trading Solutions to develop and implement the first global Direct Market Access (DMA) platform offering connectivity to Brazil ’s BM&F Bovespa market center for Itau Securities customers around the world.
  
  
• NYSE Euronext Advanced Trading Solutions continues to develop and implement new innovations in financial technology, including Wombat’s Data Fabric feed handler, agreements to deploy equity and derivative trading platforms around the world, and SFTI’s growing global connectivity.
  
  
• SFTI now connects all displayed U.S. equity markets and market participants and is expanding aggressively throughout Europe to create the world’s largest, most robust financial transaction network.

Analyst/Investor/Media Call:  Friday, October 31, 2008 ,8:00am (NY/EST)/1:00pm (Paris, CET)
Live Dial-in Information:
United States : 800.510.9661
International: 617.614.3452
Passcode: 89251210

Replay Dial-in Information:
United States : 888.286.8010
International: 617.801.6888
Passcode: 87711682

The results of operations of Euronext N.V. for the three months ended  September 30, 2008 are reported under U.S. GAAP under the caption “European Operations” in the accompanying tables. Questions regarding Euronext N.V.’s results should be directed to Investor Relations (contact details provided above). 

Note:  Based on third quarter 2008 non-GAAP net revenues (excluding activity assessment fees, and liquidity payments, routing and clearing fees), NYSE Euronext revenues from its primary business activities are represented below as a percentage of total net revenues:

    --  Derivatives trading accounts for 24%
    --  European cash trading accounts for 22%
    --  U.S. cash trading accounts for 12%
    --  Market data accounts for 15%
    --  Listing accounts for 14%
    --  Software and technology services accounts for 6%

To supplement NYSE Euronext’s consolidated financial statements prepared in accordance with GAAP and to better reflect period-over-period comparisons, NYSE Euronext uses non-GAAP financial measures of performance, financial position, or cash flows that either exclude or include amounts that are not normally excluded or included in the most directly comparable measure, calculated and presented in accordance with GAAP. Non-GAAP financial measures do not replace and are not superior to the presentation of GAAP financial results, but are provided to (i) present the effects of certain merger expenses and exit costs, and other non-recurring items, and (ii) improve overall understanding of NYSE Euronext’s current financial performance and its prospects for the future. Specifically, NYSE Euronext believes the non-GAAP financial results provide useful information to both management and investors regarding certain additional financial and business trends relating to financial condition and operating results. In addition, management uses these measures for reviewing financial results and evaluating financial performance. The non-GAAP adjustments for all periods presented are based upon information and assumptions available as of the date of this release.

 NYSE Euronext Earnings News Release with Tables and Operating Data