bme financial results 3q 2014 presentation

- 1 -

October 2014

Business Evolution January – September 2014

Business Performance

January–September 2014

- 2 -

October 2014


Disclaimer

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October 2014


Index

A. Results

B. Business Overview

C. Financials

D. Business Drivers

- 4 -

October 2014


Index

A. Results


C. Financials

D. Business Drivers

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October 2014


Results

Net profit

Net profit increase of 16.2% compared to 3Q13

+16.2% (€ Million)

33.1

38.0

42.2 41.538.5

3Q13 4Q13 1Q14 2Q14 3Q14

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October 2014


Results

Net profit

Net profit increase of 16.2% compared to 9M13 (Best result since 9M08)

+16.2%(€ Million)

116.6 118.4

105.1 105.2

122.2

9M10 9M11 9M12 9M13 9M14

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October 2014


Results

Net Profit before extraordinary

Adjusted Net Profit increases 21.1%

+ 21.1%

(Million euros)

123.0

101.6

9M2014 9M2013

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October 2014


Solid operating leverage

Costs Revenues Revenues not linked to volumes Ratio

78%

90%

106% 109% 105% 103%112%

118% 114% 116%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

- 9 -

October 2014


Key ratios benchmarking• Efficiency • ROE

- BME´s data as of 30/09/2014

- Average peer Group figures are calculated using last results published and not taking account of goodwill impairment charges

40.1%

17.9%

BME Average PeerGroup

29.8%

48.0%

BME Average PeerGroup

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October 2014


Dividends: Maximizing shareholders´ returns

Sustainability of Pay-out

First interim dividend payment: €0.40 per share (September 12th)

Second interim dividend date: December 23th

0.956 0.986

0.40 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 2014

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%

1.65

96%

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October 2014


Index

A. Results


C. Financials

D. Business Drivers

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October 2014


Business Areas

Consolidated Revenues 9M 2014 - %

EBITDA 9M 2014 - %

Redefining Business Units

Equity 46.3%

Settlement 24.6%

Clearing 5.3%

Information 11.0%

Derivatives 3.7%

Fixed Income

3.5%

IT & Consulting

5.6%

Equity 47.9%

Settlement 27.2%

Clearing 4.2%

Information 11.8%

Derivatives 2.9%

Fixed Income 2.8%

IT & Consulting

3.2%

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October 2014


158

219

191

227

197

50.8 53.0 51.4 47.0 44.2

12.6

15.518.0

15.8 16.4

3Q13 4Q13 1Q14 2Q14 3Q14

Mile

s d

e m

illo

ne

s

73

36

48

92

6760

75

51

65

7972

76

90

44

62

29.0

7.3 14.5

31.2

11.0 10.8

26.3

12.4 12.7

22.8

10.513.7

26.4

6.9 11.0

4.3

3.6

4.7

6.4

4.84.3

7.3

5.3 5.4 5.7 5.0 5.1

6.3

4.8

5.4

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

Equity Market

Equity (Turnover, volume and shares traded)

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

Growth is maintained in activity

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

Thousands of € 3Q 2014 3Q 2013 % 9M 2014 9M 2013 %

Revenues 35,382 32,865 7.7% 114,496 95,419 20.0%

Expenses (9,418) (9,167) 2.7% (28,943) (28,362) 2.0%

EBITDA 25,964 23,698 9.6% 85,553 67,057 27.6%

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October 2014


6,102 6,3494,180

8,0544,636

113 198

1,036

3,056

1,155

3Q13 4Q13 1Q14 2Q14 3Q14

New issues New listings

5,7916,215 6,547

5,216

11,110

• Listing activity

Investment flows channeled to the Exchange (€ Million)

• In the first nine months funds raised in new admissions increased 379.6% over 2013, to €5,247 million.

• The "scrip dividend" issuance continue at a high rate of emission. During the third quarter scrips were issued by €2.9 billion, up 1% on the previous year. In the year to date, scrips reached 8.1 billion, 3% more than in the same period of 2013.Source: FESE (Federation of European Stock Exchanges)

Equity Market

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October 2014


12.1

13.8 13.612.9 12.4

3Q13 4Q13 1Q14 2Q14 3Q14

1,543 1,514 1,492 1,480 1,466

616 676 710 754 751

3Q13 4Q13 1Q14 2Q14 3Q14

2,2172,159 2,190 2,2342,202

Nominal registered in FI Market cap registered in Equity

Securities under custody: Volumes (€ Billion)

Settlement & Registration

Settlement: Number of trades settled(Million of trades)

Revenue growth in settlement compensates the fall in registration


Revenues 19,676 18,364 7.1% 60,821 61,829 -1.6%

Expenses (4,128) (3,266) 26.4% (12,201) (10,198) 19.6%

EBITDA 15,548 15,098 3.0% 48,620 51,631 -5.8%

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October 2014


8796

107113 112

3.9 3.9 4.13.5 3.2

3Q13 4Q13 1Q14 2Q14 3Q14

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)

Continued positive trend in users and connections


Revenues 8,960 8,070 11.0% 27,254 24,513 11.2%

Expenses (1,960) (1,752) 11.9% (6,110) (5,477) 11.6%

EBITDA 7,000 6,318 10.8% 21,144 19,036 11.1%

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October 2014


7,845

11,14410,364 10,239

5,051

3Q13 4Q13 1Q14 2Q14 3Q14

356,724

314,932

397,583

233,375 237,474

3Q13 4Q13 1Q14 2Q14 3Q14

Clearing

Good behavior of the derivatives segment

Turnover MEFFREPO (€ Million) Volume (Mwh) traded in Energy market (Thousand)


Revenues 4,120 3,785 8.9% 13,060 11,424 14.3%

Expenses (1,725) (1,080) 59.7% (5,471) (4,028) 35.8%

EBITDA 2,395 2,705 -11.5% 7,589 7,396 2.6%

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October 2014


2,770 2,303

10,391 10,766

5,814 5,515

18,477 18,144

3Q13 3Q14 9M13 9M14

1,3051,638

4,053

4,907

456701

1,444

2,006

1,207

1,741

3,631

5,480

3Q13 3Q14 9M13 9M14

Derivatives

(Thousand of contracts)

Growth in Ibex 35 ® contracts

Stock derivatives contracts tradedIndex derivatives contracts traded

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

(Thousand of contracts)

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


Revenues 2,808 2,700 4.0% 9,060 8,677 4.4%

Expenses (1,223) (1,653) -26.0% (3,953) (4,363) -9.4%

EBITDA 1,585 1,047 51.4% 5,107 4,314 18.4%

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October 2014


192 212

304241

102

5769

76

111

102

3Q13 4Q13 1Q14 2Q14 3Q14

204

249

352380

281

Fixed income

Growth in revenues from listing

AIAF – Turnover (Billion €)

Repo Cash

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

MARF (Alternative Fixed Income Market) activity after 9 months:

•17 Market Members and 17 registered Advisers

• 5 issues maturing in 5 to 7years (€231 million)

• 5 promissory note issue programmes (máximum balance of €249.9 million) and 19 promissory note payments (€149.9 million)

•1 issue of securitization (€10 million). Open for a maximum amount of €500 million


Revenues 2,659 2,755 -3.5% 8,709 9,043 -3.7%

Expenses (1,286) (1,292) -0.5% (3,795) (3,981) -4.7%

EBITDA 1,373 1,463 -6.2% 4,914 5,062 -2.9%

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October 2014


IT & ConsultingThousands of € 3Q 2014 3Q 2013 % 9M 2014 9M 2013 %

Revenues 5,144 3,932 30.8% 13,749 13,306 3.3%

Expenses (2,657) (2,385) 11.4% (8,091) (7,477) 8.2%

EBITDA 2,487 1,547 60.8% 5,658 5,829 -2.9%

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October 2014


Breakdown by business areas

Revenues


Equity 35,382 32,865 7.7% 114,496 95,419 20.0%

Settlement 19,676 18,364 7.1% 60,821 61,829 -1.6%

Clearing 4,120 3,785 8.9% 13,060 11,424 14.3%

Information 8,960 8,070 11.0% 27,254 24,513 11.2%

Derivatives 2,808 2,700 4.0% 9,060 8,677 4.4%

Consulting & IT 5,144 3,932 30.8% 13,749 13,306 3.3%

Fixed income 2,659 2,755 -3.5% 8,709 9,043 -3.7%

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October 2014


Breakdown by business areas

EBITDA


Equity 25,964 23,698 9.6% 85,553 67,057 27.6%

Settlement 15,548 15,098 3.0% 48,620 51,631 -5.8%

Clearing 2,395 2,705 -11.5% 7,589 7,396 2.6%

Information 7,000 6,318 10.8% 21,144 19,036 11.1%

Derivatives 1,585 1,047 51.4% 5,107 4,314 18.4%

Consulting & IT 2,487 1,547 60.8% 5,658 5,829 -2.9%

Fixed income 1,373 1,463 -6.2% 4,914 5,062 -2.9%

- 23 -

October 2014


Index

A. Results


C. Financials

D. Business Drivers

- 24 -

October 2014


Balance sheetas of September, 30th

(Thousands of €)2014 2013

Goodwill 80,619 82,190

Other non-current assets 91,573 83,552

Cash and cash equivalents 204,349 243,088

Current financial assets 110,683 53,433

Non-Group current financial assets 25,459,077 36,160,066

Other current assets 45,427 38,295

Total assets 25,991,728 36,660,624

Owners' Equity 427,469 403,610

External Partners 0 161

Non-current liabilities 17,805 18,628

Current liabilities 25,546,454 36,238,225

Total equity and liabilities 25,991,728 36,660,624

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October 2014


P/L


Revenues 79,505 72,537 9.6% 249,035 225,918 10.2%

Expenses (24,237) (23,652) 2.5% (74,195) (74,435) -0.3%

EBITDA 55,268 48,885 13.1% 174,840 151,483 15.4%

EBIT 53,668 47,162 13.8% 170,030 146,224 16.3%

Financial results 397 506 -21.5% 1,908 2,911 -34.5%

Share of profit (loss) of associates 326 (161) 302.5% 1,058 (404) 361.9%

EBT 54,391 47,507 14.5% 172,996 148,731 16.3%

Net Profit 38,495 33,142 16.2% 122,229 105,160 16.2%

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October 2014


EBITDA 9M 2014/2013 [€ Mill.] Net Profit 9M 2014/2013 [€ Mill.]

Comparison with 9M 2013

Revenues 9M 2014/2013 Costs 9M 2014/2013

Margins

[€ Mill.] [€ Mill.]+ 10.2% - 0.3%

+ 15.4% + 16.2%

249.0 225.9

9M 2014 9M 2013

74.274.4

9M 2014 9M 2013

174.8 151.5

9M 2014 9M 2013

122.2 105.2

9M 2014 9M 2013

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October 2014


30.5% 32.6% 29.8%32.9%

3Q14 3Q13 9M14 9M13

45.2%50.2%

43.6%50.9%

3Q14 3Q13 9M14 9M13

67.5% 65.0% 68.3% 64.7%

3Q14 3Q13 9M14 9M13

Efficiency & ProfitabilityROE Evolution EBIT/Revenues Ratio Evolution

% ROE % EBIT/Revenues

% Cost/EBIT % Efficiency

Cost/EBIT Ratio Evolution Efficiency Ratio Evolution

36.5% 33.1%40.1%

34.7%

3Q14 3Q13 9M14 9M13

- 28 -

October 2014


Index

A. Results


C. Financials

D. Business Drivers

- 29 -

October 2014


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

Source: Bloomberg 1) As of 30/09/14

RK9M14

1

2

3

4

5

6

7

8

9

10

22

27

33

Company Daily avg. 9M14

Turnover (€ Biilion)RK

105.6

99.6

91.5

86.9

81.4

71.8

68.4

67.5

66.6

64.3

47.6

41.6

36.4

1

2

3

4

5

6

7

8

9

10

20

21

28

0.55

0.52

0.48

0.46

0.43

0.38

0.36

0.35

0.35

0.34

0.25

0.22

0.19

4.460%

1.660%

2.720%

1.560%

2.470%

2.650%

2.770%

1.660%

6.220%

3.330%

0.900%

1.470%

1.180%

Relative weight at EuroStoxx50 (%)1)

Turnover (€ Biilion)

- 30 -

October 2014


4Q13

1.193%

1.029%

1.021%

1.037%

1.010%

0.984%

0.927%

0.988%

1.022%

0.960%

1.095%

1.303%

1.102%

0.359%

0.332%

0.336%

0.359%

0.304%

0.290%

0.275%

0.271%

0.273%

0.249%

0.304%

0.322%

0.289%

0.070%

0.062%

0.063%

0.068%

0.066%

0.068%

0.064%

0.062%

0.061%

0.058%

0.059%

0.062%

0.056%

201309

201310

201311

201312

201401

201402

201403

201404

201405

201406

201407

201408

201409

The average spread continue to narrow in increasing liquidity:

– IBEX 35® average spread falling by 1.4 basis points from September 2013

– Medium and small cap companies have improved the average spread 7.0 and 9.1 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 (%)

- 31 -

October 2014


• Distribution by markets of business volume of the IBEX 35® companies (2008 – 1H14)

Diversified market

Source: Interim Reports from listed companies obtained from CNMV

Spain EU OCDE Rest

19%

20%

25%

- 32 -

October 2014


Q&A

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