bme 1st. quarter financial results

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- 1 - April 2014 Business Evolution January – March 2014 Business Performanc e First quarter 2014

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BME Financial Results 1st. Quarter 2014

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Page 1: BME 1st. Quarter Financial Results

- 1 -

April 2014

Business Evolution January – March 2014

Business Performance

First quarter 2014

Page 2: BME 1st. Quarter Financial Results

- 2 -

April 2014

Business Evolution January – March 2014

Disclaimer

THIS INFORMATION IS STRICTLY CONFIDENTIAL AND IS BEING FURNISHED TO YOU SOLELY FOR YOUR INFORMATION. IT MAY NOT BE REPRODUCED OR REDISTRIBUTED TO ANY OTHER PERSON, AND IT MAY NOT BE PUBLISHED, IN WHOLE OR IN PART, FOR ANY PURPOSE. BY RECEIVING THIS INFORMATION, YOU BECOME BOUND BY THE ABOVE-REFERRED CONFIDENTIALITY OBLIGATION. FAILURE TO COMPLY WITH SUCH CONFIDENTIALITY OBLIGATION MAY RESULT IN CIVIL, ADMINISTRATIVE OR CRIMINAL LIABILITIES.

NEITHER THIS INFORMATION NOR ANY COPY OF IT MAY BE TAKEN, TRANSMITTED INTO, DISCLOSED OR DISTRIBUTED IN THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN. THE DISTRIBUTION OF THIS INFORMATION IN OTHER JURISDICTIONS MAY ALSO BE RESTRICTED BY LAW AND PERSONS INTO WHOSE POSSESSION THIS INFORMATION COMES SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH RESTRICTIONS.

THIS INFORMATION DOES NOT CONSTITUTE OR FORM PART OF ANY OFFER FOR SALE OR SOLICITATION OF ANY OFFER TO BUY ANY SECURITIES NOR SHALL IT OR ANY PART OF IT FORM THE BASIS OF OR BE RELIED ON IN CONNECTION WITH ANY CONTRACT OR COMMITMENT TO PURCHASE SHARES.

THE INFORMATION CONTAINED IN THIS DOCUMENT HAS BEEN PROVIDED BY BME.

Page 3: BME 1st. Quarter Financial Results

- 3 -

April 2014

Business Evolution January – March 2014

Index

A. Results

B. Business Overview

C. Financials

D. Business Drivers

Page 4: BME 1st. Quarter Financial Results

- 4 -

April 2014

Business Evolution January – March 2014

Index

A. Results

B. Business Overview

C. Financials

D. Business Drivers

Page 5: BME 1st. Quarter Financial Results

- 5 -

April 2014

Business Evolution January – March 2014

33.0

39.0

33.1

38.0

42.2

1Q13 2Q13 3Q13 4Q13 1Q14

Results

Net profit

Net profit increase of 27.9% compared to 1Q13

+27.9% (€ Million)

Page 6: BME 1st. Quarter Financial Results

- 6 -

April 2014

Business Evolution January – March 2014

Solid operating leverage

Costs Revenues Revenues not linked to volumes Ratio

78%

90%

106% 109% 105% 103%112%

118% 114% 113%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Page 7: BME 1st. Quarter Financial Results

- 7 -

April 2014

Business Evolution January – March 2014

Dividends: Maximizing shareholders´ returns

0.956 0.986

0.40 0.40 0.40 0.40 0.40

0.60 0.60 0.60 0.60 0.60

1.016 0.986

0.60 0.60 0.60 0.60 0.65

0.372 0.372 0.372 0.372

2007 2008 2009 2010 2011 2012 2013

First Interim Dividend Second Interim Dividend Suplementary Dividend Extraordinary Dividend

1.972 1.972Total Dividends /Share

Pay Out 82% 86%

1.9721.9721.972

89% 86% 86%

1.972

98% 96%

Page 8: BME 1st. Quarter Financial Results

- 8 -

April 2014

Business Evolution January – March 2014

Index

A. Results

B. Business Overview

C. Financials

D. Business Drivers

Page 9: BME 1st. Quarter Financial Results

- 9 -

April 2014

Business Evolution January – March 2014

Business Areas

Consolidated Revenues 1Q 2014 - %

EBITDA 1Q 2014 - %

Equity 48.5%

Settlement 23.6%

Clearing 5.5%

Information 10.3%

Derivatives 3.8%

Fixed Income

3.8%

IT & Consulting

4.4%

Equity 50.3%

Settlement 26.0%

Clearing 5.0%

Information 10.8%

Derivatives 2.9%

Fixed Income 3.2%

IT & Consulting

1.7%

Redefining Business Units

Page 10: BME 1st. Quarter Financial Results

- 10 -

April 2014

Business Evolution January – March 2014

162 165 158

219

191

48.7 48.2 50.8 53.0 51.4

10.2 10.612.6

15.5

18.0

1Q13 2Q13 3Q13 4Q13 1Q14M

iles

de m

illon

es

68

42

5258

48

59

73

36

48

92

6760

75

51

65

28.28.4

12.1

27.5

9.5 11.1

29.0

7.314.5

31.2

11.0 10.8

26.3

12.4 12.7

3.3 3.5 3.4 3.93.2

3.5

4.3

3.6

4.7

6.4

4.84.3

7.3

5.35.4

1/13 2/13 3/13 4/13 5/13 6/13 7/13 8/13 9/13 10/13 11/13 12/13 1/14 2/14 3/14

Equity Market

Equity (Turnover, volume and shares traded)

Turnover (€ Bill.) Shares (Bill.) Trades (Mill.) Turnover (€ Bill.) Shares (Bill.) Trades (Mill.)

Continued intensification of activity

Thousands of € 1Q 2014 1Q 2013 %

Revenues 41,575 31,992 30.0%

Expenses (9,805) (9,719) 0.9%

EBITDA 31,770 22,273 42.6%

Note: Business Unit is redefined incorporating activity, income and expenses of the Equity Listing

Page 11: BME 1st. Quarter Financial Results

- 11 -

April 2014

Business Evolution January – March 2014

7,977

11,363

6,215 6,547

5,216

1Q13 2Q13 3Q13 4Q13 1Q14

• Listing activity

Investment flows channeled to the Exchange (€ Million)

• In 2014 IPOs activity have reactivated: Lar España Real Estate, Hispania Activos Inmobiliarios and Edreams Odigeo became listed in the Exchange

• ETFs assets under management linked to the IBEX® indexes closed the first quarter with a volume of €1.7 billion, 3.4 times the amount recorded the previous year

• Flows channeled to the Exchange maintain a high emission rate of 5.2 billion euros issued from January to March

Source: FESE (Federation of European Stock Exchanges)

Equity Market

Page 12: BME 1st. Quarter Financial Results

- 12 -

April 2014

Business Evolution January – March 2014

1,593 1,579 1,543 1,514 1,492

530 537 616 676 710

1Q13 2Q13 3Q13 4Q13 1Q14

2,116 2,159 2,1902,123 2,202

10.411.6 12.1

13.8 13.6

1Q13 2Q13 3Q13 4Q13 1Q14

Nominal registered in FI Market cap registered in Equity

Securities under custody: Volumes (€ Billion)

Settlement

Settlement: Number of trades settled(Million of trades)

Increased revenue contribution from settlement

Thousands of € 1Q 2014 1Q 2013 %

Revenues 20,246 18,606 8.8%

Expenses (3,830) (3,380) 13.3%

EBITDA 16,416 15,226 7.8%

Page 13: BME 1st. Quarter Financial Results

- 13 -

April 2014

Business Evolution January – March 2014

94 92 8796

107

3.9 3.93.6 3.8 4.1

1Q13 2Q13 3Q13 4Q13 1Q14

Subscribers (Thous.) P.Quote (Mill.)

Market Data & Information

Information: Subscribers to primary market sources (Average for the period in thousands of subscribers and millions of accesses per quote)

Positive trend in the number of subscribers

Thousands of € 1Q 2014 1Q 2013 %

Revenues 8,854 8,092 9.4%

Expenses (2,067) (1,875) 10.2%

EBITDA 6,787 6,217 9.2%

Page 14: BME 1st. Quarter Financial Results

- 14 -

April 2014

Business Evolution January – March 2014

282,934

363,589 356,724

314,932

397,583

2,661

3,085 3,251 3,0993,451

1Q13 2Q13 3Q13 4Q13 1Q14

ClearingThousands of € 1Q 2014 1Q 2013 %

Revenues 4,729 3,831 23.4%

Expenses (1,588) (1,515) 4.8%

EBITDA 3,141 2,316 35.6%

Activity growth in all three segments

Turnover and operations MEFFREPO Contracts and Mwh volume traded in Energy market

10,547

15,499

26,271

38,843

45,256

6,5687,920 7,845

11,14410,364

1Q13 2Q13 3Q13 4Q13 1Q14

Turnover (€Mill.) Operations Contracts Volume Mwh (Thousand)

Page 15: BME 1st. Quarter Financial Results

- 15 -

April 2014

Business Evolution January – March 2014

4,2004,536

6,704 6,747

1Q13 1Q14

1,238

1,698

476

674

1,278

1,872

1Q13 1Q14

Derivatives

(Thousand of contracts)

Increased trading in key underlyings

Stock derivatives contracts tradedIndex derivatives contracts traded

IBEX 35® Futures MiniIBEX 35® Futures IBEX 35® Options Stock Futures Stock Options

(Thousand of contracts)

Thousands of € 1Q 2014 1Q 2013 %

Revenues 3,230 2,970 8.8%

Expenses (1,370) (1,408) -2.7%

EBITDA 1,860 1,562 19.1%

Note: Business Unit is redefined excluding revenue from clearing and settlement and now are recognized in the Clearing Business Unit

Page 16: BME 1st. Quarter Financial Results

- 16 -

April 2014

Business Evolution January – March 2014

340

258

192212

304

67

92

5769

76

89,455

390,824375,014

105,289136,221

1Q13 2Q13 3Q13 4Q13 1Q14

599

811

350

799

91432

45

86

65

31,915

45,109

24,316

48,522

59,061

1Q13 2Q13 3Q13 4Q13 1Q14

Fixed income

Growing trading in electronic platforms

AIAF – Turnover (Billion €)

Repo Cash Trades

Thousands of € 1Q 2014 1Q 2013 %

Revenues 3,298 3,053 8.0%

Expenses (1,249) (1,361) -8.2%

EBITDA 2,049 1,692 21.1%

SEND – Turnover (Millon €)

Private Fixed Income Public Debt Operations

Note: Business Unit is redefined incorporating activity, income and expenses of the Fixed Income Listing

Page 17: BME 1st. Quarter Financial Results

- 17 -

April 2014

Business Evolution January – March 2014

IT & ConsultingThousands of € 1Q 2014 1Q 2013 %

Revenues 3,784 4,429 -14.6%

Expenses (2,698) (2,449) 10.2%

EBITDA 1,086 1,980 -45.2%

Page 18: BME 1st. Quarter Financial Results

- 18 -

April 2014

Business Evolution January – March 2014

Breakdown by business areas

Revenues

Thousands of € 1Q 2014 1Q 2013 %

Equity 41,575 31,992 30.0%

Settlement 20,246 18,606 8.8%

Clearing 4,729 3,831 23.4%

Information 8,854 8,092 9.4%

Derivatives 3,230 2,970 8.8%

Consulting & IT 3,784 4,429 -14.6%

Fixed income 3,298 3,053 8.0%

Page 19: BME 1st. Quarter Financial Results

- 19 -

April 2014

Business Evolution January – March 2014

Breakdown by business areas

EBITDA

Thousands of € 1Q 2014 1Q 2013 %

Equity 31,770 22,273 42.6%

Settlement 16,416 15,226 7.8%

Clearing 3,141 2,316 35.6%

Information 6,787 6,217 9.2%

Derivatives 1,860 1,562 19.1%

Consulting & IT 1,086 1,980 -45.2%

Fixed income 2,049 1,692 21.1%

Page 20: BME 1st. Quarter Financial Results

- 20 -

April 2014

Business Evolution January – March 2014

Index

A. Results

B. Business Overview

C. Financials

D. Business Drivers

Page 21: BME 1st. Quarter Financial Results

- 21 -

April 2014

Business Evolution January – March 2014

Balance sheetas of March, 31th (Thousands of €)

2014 2013

Goodwill 80,619 82,190

Other non-current assets 87,525 96,758

Cash and cash equivalents 218,468 299,734

Current financial assets 97,116 15,630

Non-Group current financial assets 34,438,920 44,111,699

Other current assets 84,859 379,846

Total assets 35,007,507 44,985,857

Owners' Equity 433,972 446,987

External Partners 0 204

Non-current liabilities 17,151 22,063

Current liabilities 34,556,384 44,516,603

Total equity and liabilities 35,007,507 44,985,857

Page 22: BME 1st. Quarter Financial Results

- 22 -

April 2014

Business Evolution January – March 2014

P/LThousands of € 1Q 2014 1Q 2013 %

Revenues 86,002 73,032 17.8%

Expenses (25,122) (25,161) -0.2%

EBITDA 60,880 47,871 27.2%

EBIT 59,255 46,084 28.6%

Financial results 478 846 -43.5%

Share of profit (loss) of associates 182 (113) -261.1%

EBT 59,915 46,817 28.0%

Net Profit 42,185 32,988 27.9%

Page 23: BME 1st. Quarter Financial Results

- 23 -

April 2014

Business Evolution January – March 2014

EBITDA 1Q 2014/2013 [€ Mill.] Net Profit 1Q 2014/2013 [€ Mill.]

Comparison with 1Q 2013

Revenues 1Q 2014/2013 Costs 1Q 2014/2013

Margins

[€ Mill.] [€ Mill.]+ 17.8% - 0.2%

+ 27.2% + 27.9%

86.073.0

1Q 2014 1Q 2013

25.125.2

1Q 2014 1Q 2013

60.9 47.9

1Q 2014 1Q 2013

42.2 33.0

1Q 2014 1Q 2013

Page 24: BME 1st. Quarter Financial Results

- 24 -

April 2014

Business Evolution January – March 2014

29.2%34.5%

1Q14 1Q13

42.4%

54.6%

1Q14 1Q13

68.9%63.1%

1Q14 1Q13

Efficiency & ProfitabilityROE Evolution EBIT/Revenues Ratio Evolution

% ROE % EBIT/Revenues

% Cost/EBIT % Efficiency

Cost/EBIT Ratio Evolution Efficiency Ratio Evolution

41.1%31.0%

1Q14 1Q13

Page 25: BME 1st. Quarter Financial Results

- 25 -

April 2014

Business Evolution January – March 2014

Index

A. Results

B. Business Overview

C. Financials

D. Business Drivers

Page 26: BME 1st. Quarter Financial Results

- 26 -

April 2014

Business Evolution January – March 2014

Business drivers: Highly liquid market • Spanish blue-chips among the most liquid stocks in the EMU

Source: Bloomberg 1) As of 31/03/14

RK1Q14

1

2

3

4

5

6

7

8

9

10

22

27

33

Company Daily avg. 1Q14

Turnover (€ Biilion)RK

37.8

32.6

28.4

26.4

24.2

22.7

22.4

22.1

21.3

20.7

13.5

11.1

10.9

1

2

3

4

5

6

7

8

9

10

23

32

33

0.60

0.52

0.45

0.42

0.38

0.36

0.35

0.35

0.34

0.33

0.21

0.18

0.17

1.800%

4.020%

2.570%

1.710%

1.670%

3.440%

3.020%

4.190%

2.320%

4.650%

1.420%

0.790%

1.190%

Relative weight at EuroStoxx50 (%)1)

Turnover (€ Biilion)

Page 27: BME 1st. Quarter Financial Results

- 27 -

April 2014

Business Evolution January – March 2014

4Q13

1.410%

1.516%

1.527%

1.582%

1.540%

1.350%

1.193%

1.029%

1.021%

1.037%

1.010%

0.984%

0.927%

0.813%

0.389%

0.379%

0.354%

0.376%

0.418%

0.400%

0.359%

0.332%

0.336%

0.359%

0.304%

0.290%

0.275%

0.246%

0.081%

0.087%

0.075%

0.076%

0.078%

0.073%

0.070%

0.062%

0.063%

0.068%

0.066%

0.068%

0.064%

0.059%

201303

201304

201305

201306

201307

201308

201309

201310

201311

201312

201401

201402

201403

20140331

The average spread continue to narrow in increasing liquidity:

– IBEX 35® spread ended the quarter below 6 basis points, falling by 2.2 percentage points from March 2013

– Medium and small cap companies have improved the average spread 11.4 and 48.3 basis points respectively

Business drivers: Highly liquid market • Quality of spreads and best market impact for Spanish stocks

Source: Market annual and monthly reports

Avg.Spread (%) Avg.Spread (%) Avg.Spread (%)

Page 28: BME 1st. Quarter Financial Results

- 28 -

April 2014

Business Evolution January – March 2014

Q&A