Strong performance of Euronext through 2019
- Double digit growth in annual revenue to €679.1 million (+10.4%):
- Contribution from Oslo Børs VPS of €57.1 million for 6.5 months of consolidation, reflecting successful diversification
- Strong growth in listing revenue to €129.0 million (+21.1%), driven by the consolidation of Oslo Børs VPS and the solid performance of Corporate Services at €24.4 million (+43.4% like-for-like). Like-for-like, listing revenue increased +3.9%
- Cash trading revenue decreased to €205.6 million (-2.6%), like-for-like revenue decreased -5.8% in a low-volumes environment (-9.4%), market share significantly improved to 68.7% over 2019 (+2.6pts) and yield increased to 0.53bps (+4.0%)
- Advanced data services revenue increased to €128.8 million (+8.8%), as a result of the consolidation of Oslo Børs VPS and the good performance of the indices business. Like-for-like, revenue increased +1.1%
- Post-trade revenue strongly increased to €104.8 million (+35.5%), driven by the consolidation of the Norwegian VPS CSD revenue, and higher treasury income offsetting lower volumes while derivatives clearing revenue was stable. Like-for-like, revenue increased +0.1%
- Group non-volume related revenue1 accounted for 50% of 2019 total revenue (vs. 44% in 2018), and covered 122% of operating expenses excluding depreciation & amortisation (vs. 104% in 2018)
• Double digit growth in EBITDA to €399.4 million (+12.8%), with EBITDA margin at 58.8% (+1.2pts):
- Group operating costs excluding D&A were up +€18.9 million as a result of the consolidation of costs from acquired businesses, partially offset by continued cost discipline and the positive impact of IFRS 16
- €7.8 million run-rate cost synergies achieved from Euronext Dublin as of 31 December 2019 (compared to €2.7 million as of 31 December 2018)
• Increase in reported net income, share of the Group, to €222.0 million (+2.8%):
- Exceptional items at €21.9 million, reflecting primarily acquisitions costs, restructuring costs as well as termination of contracts of Oslo Børs VPS
- Net financing expenses at €17.4 million, resulting from revaluation of buy-options on minority stakes in acquisitions made in Corporate Services in 2017 and deferred payments
- Income tax rate at 30.8% reflecting various non-deductible expenses
• Double digit growth in adjusted EPS2 to €3.90 (+10.9%)
Dividend proposal for 2019
In accordance with Euronext dividend policy, a pay-out ratio of 50% of reported net income representing a dividend for 2019 of €111 million (€1.59 per share) will be proposed to the AGM3 on 14 May 2020.
Cost guidance for 2020
As announced at the 2019 Investor Day, Euronext expects to incur non-recurring costs related to the integration of Oslo Børs VPS and internal digitalisation projects, which will start generating savings in 2021. As a result, Euronext expects its operating costs excluding D&A to temporarily increase by a mid-single digit4 in 2020, compared to its second half 2019 annualised cost base.5
Stéphane Boujnah, Chief Executive Officer and Chairman of the Managing Board of Euronext, said:
“Euronext delivered a strong performance in 2019 with double digit growth in revenue, EBITDA and adjusted EPS. This performance results from successful diversification and solid core businesses dynamics, with a cash trading market share at 68.7% for the Group through the year. Our core business further proved its resilience in 2019, as, on a like-for-like basis, revenue only decreased -1.0%, against a -9.4% drop in cash trading volumes.
This year, Euronext released its new strategic plan, ‘Let’s grow together 2022’, with a strong focus on growth, innovation and sustainable finance, aiming to build the leading pan-European market infrastructure. The Group already reached a first milestone with the acquisition of Nord Pool, strengthening its presence in the Nordics and diversifying into power markets. Euronext remains committed to deploying its capital, in a disciplined way, to diversify its revenue profile and to expand its federal model further.
In 2019, Euronext also completed the deployment of its Optiq® trading platform to its derivative markets, paving the way for the migration of Oslo Børs markets to Optiq® in 2020. The integration of Oslo Børs VPS will be a key element for the delivery of the announced synergies. As a result of the integration and internal projects, Euronext expects a non-recurring mid-single digit growth1 of Group operating expenses (excluding D&A) in 2020, compared to its second half 2019 annualised cost base.”
