Fourth Quarter and Full Year Highlights*
- Diluted EPS for the Quarter of $1.49, Down 3 percent; Diluted EPS for the Full
Year of $2.19, Down 55
percent
- Adjusted Diluted EPS¹ for the Quarter of $1.80, Up 6 percent; Adjusted Diluted EPS for the
Full Year of $6.93, Up 15
percent
- Net Revenue for the Quarter of $457.1
million, Up 17 percent; Net Revenue for the Full Year of
$1.7 billion, Up 18 percent
- Establishing Organic Total Net Revenue Growth
Target2 for 2023 of 7 to 9 percent and Data and
Access Solutions Organic Net Revenue Growth Target2 of 7
to 10 percent
- Establishing 2023 Adjusted Operating Expense
Guidance2 of $769 to
$779 million, Reflecting Continued
Investment to Drive Long-Term Revenue and Earnings Growth
CHICAGO, Feb. 3, 2023 /PRNewswire/ -- Cboe Global
Markets, Inc. (Cboe: CBOE) today reported financial results
for the fourth quarter of 2022 and full year.
"2022 was a year of substantial progress at Cboe as we continued
to build out our global network, while delivering record financial
results. Our accomplishments in 2022 have laid a strong foundation
and, as we enter our 50th year of business, we are more optimistic
than ever about the future," said Edward T.
Tilly, Cboe Global Markets Chairman and Chief Executive
Officer. "We are focused on accelerating our momentum in three key
areas of our business – Derivatives, Data and Access Solutions and
Digital. Furthermore, organic growth efforts aimed at deepening our
geographic reach and extending market access to our unique set of
products and services around the globe will be critical for us. I
want to thank the entire team at Cboe for the tremendous
accomplishments produced in 2022, and I look forward to an
outstanding year ahead."
"Cboe reported a very strong fourth quarter to cap a record year
for the company. I could not be more pleased with the consistent
progress we showed as a firm throughout 2022," said Brian N. Schell, Cboe Global Markets Executive
Vice President, Chief Financial Officer and Treasurer. "During 2022
our Derivatives business net revenues grew an impressive 28%, Cash
and Spot Market net revenues were up 3%, and Data and Access
Solutions net revenues increased by 16%. Following our record year
of revenue generation, we anticipate organic total net revenue
growth2 will average 7-9% in 2023, above our medium-term
guidance range of 5-7%. We anticipate Data and Access Solutions
organic net revenue growth2 will average an attractive
7-10%, in line with our medium-term expectations. While we will be
making continued investments in our business to drive future
durable growth, we anticipate delivering long-term shareholder
value through an attractive capital return policy. 2022 provided us
with many great opportunities to build upon in the year ahead, and
we look forward to delivering on our objectives in 2023."
*All comparisons are
fourth quarter 2022 compared to the same period in
2021.
|
(1)A full reconciliation
of our non-GAAP results to our GAAP ("Generally Accepted Accounting
Principles") results is included in the attached tables. See
"Non-GAAP Information" in the accompanying financial
tables.
|
(2)Specific quantifications of
the amounts that would be required to reconcile the company's
organic growth guidance, adjusted operating expenses guidance and
the effective tax rate on adjusted earnings guidance are not
available. The company believes that there is uncertainty and
unpredictability with respect to certain of its GAAP measures,
primarily related to acquisition-related revenues and expenses that
would be required to reconcile to GAAP revenues less cost of
revenues, GAAP operating expenses and GAAP effective tax rate,
which preclude the company from providing accurate guidance on
certain forward-looking GAAP to non-GAAP reconciliations. The
company believes that providing estimates of the amounts that would
be required to reconcile the range of the company's organic growth,
adjusted operating expenses and the effective tax rate on adjusted
earnings would imply a degree of precision that would be confusing
or misleading to investors for the reasons identified
above.
|
Consolidated Fourth Quarter Results - Table 1
Table 1 below presents summary selected unaudited condensed
consolidated financial information for the company as reported and
on an adjusted basis for the three months ended December 31, 2022 and 2021.
|
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Table
1
|
Consolidated Fourth Quarter Results
|
|
|
|
|
|
|
|
|
|
|
|
4Q22
|
|
4Q21
|
|
|
($ in millions except per share
data)
|
|
4Q22
|
|
4Q21
|
Change
|
|
Adjusted1
|
|
Adjusted1
|
Change
|
Total Revenues Less
Cost of Revenues
|
|
$
|
457.1
|
|
|
$
|
390.5
|
|
17
|
%
|
|
$
|
457.1
|
|
|
$
|
390.5
|
|
17
|
%
|
Total Operating
Expenses
|
|
$
|
206.6
|
|
|
$
|
169.9
|
|
22
|
%
|
|
$
|
176.6
|
|
|
$
|
137.5
|
|
28
|
%
|
Operating
Income
|
|
$
|
250.5
|
|
|
$
|
220.6
|
|
14
|
%
|
|
$
|
280.5
|
|
|
$
|
253.0
|
|
11
|
%
|
Operating Margin
%
|
|
|
54.8
|
%
|
|
|
56.5
|
%
|
(170)
|
pp
|
|
|
61.4
|
%
|
|
|
64.8
|
%
|
(340)
|
pp
|
Net Income Allocated to
Common Stockholders
|
|
$
|
159.0
|
|
|
$
|
165.3
|
|
(4)
|
%
|
|
$
|
192.2
|
|
|
$
|
181.7
|
|
6
|
%
|
Diluted EPS
|
|
$
|
1.49
|
|
|
$
|
1.54
|
|
(3)
|
%
|
|
$
|
1.80
|
|
|
$
|
1.70
|
|
6
|
%
|
EBITDA1
|
|
$
|
295.5
|
|
|
$
|
262.7
|
|
12
|
%
|
|
$
|
292.3
|
|
|
$
|
263.7
|
|
11
|
%
|
EBITDA Margin
%1
|
|
|
64.6
|
%
|
|
|
67.3
|
%
|
(270)
|
pp
|
|
|
63.9
|
%
|
|
|
67.5
|
%
|
(360)
|
pp
|
- Total revenues less cost of revenues (referred to as "net
revenue") of $457.1 million increased
17 percent, compared to $390.5
million in the prior-year period, reflecting increases in
derivatives markets and data and access solutions. Inorganic net
revenue1 in the fourth quarter of 2022 was $5.1 million.
- Total operating expenses were $206.6
million versus $169.9 million
in the fourth quarter of 2021, an increase of $36.7 million, while adjusted operating expenses¹
of $176.6 million increased 28
percent compared to $137.5 million in
the fourth quarter of 2021. These increases were primarily due to
the acquisitions of Cboe Digital (formerly ErisX) and NEO, as well
as higher compensation and benefits, travel and promotional, and
technology support services expenses.
- The effective tax rate for the fourth quarter of 2022 was 32.3
percent compared with 21.1 percent in the fourth quarter of 2021.
The increase is primarily due to releases of reserves for
unrecognized tax benefits in 2021. The effective tax rate on
adjusted earnings1 was 27.4 percent compared with 24.8
percent in last year's fourth quarter. The higher effective tax
rate in the fourth quarter of 2022 was primarily due to favorable
non-recurring adjustments in the fourth quarter of 2021.
- Diluted EPS for the fourth quarter of 2022 decreased 3 percent
to $1.49 compared to the fourth
quarter of 2021. Adjusted diluted EPS1 of $1.80 increased 6 percent compared to 2021's
fourth quarter results.
Business Segment Information:
|
|
|
|
|
|
|
|
|
|
|
Table
2
|
Total Revenues Less
Cost of Revenues by
|
|
|
|
|
|
|
|
|
|
|
Business
Segment
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
|
4Q22
|
|
4Q21
|
Change
|
Options
|
|
$
|
273.2
|
|
$
|
202.5
|
|
|
35
|
%
|
North American
Equities
|
|
|
96.4
|
|
|
91.6
|
|
|
5
|
%
|
Europe and Asia
Pacific
|
|
|
44.2
|
|
|
51.7
|
|
|
(15)
|
%
|
Futures
|
|
|
26.8
|
|
|
29.9
|
|
|
(10)
|
%
|
Global FX
|
|
|
16.9
|
|
|
14.8
|
|
|
14
|
%
|
Digital
|
|
|
(0.4)
|
|
|
*
|
|
|
*
|
%
|
Total
|
|
$
|
457.1
|
|
$
|
390.5
|
|
|
17
|
%
|
|
(1)A full reconciliation of our
non-GAAP results to our GAAP results is included in the attached
tables. See "Non-GAAP Information" in the accompanying financial
tables.
|
*Not meaningful, due
to the establishment of the Digital segment during the second
quarter of 2022 as a result of the Cboe Digital acquisition on May
2, 2022.
|
Discussion of Results by Business
Segment1:
Options:
- Options net revenue of $273.2
million was up $70.7 million,
or 35 percent, from the fourth quarter of 2021. The growth was
driven by double-digit increases in net transaction and clearing
fees2, access and capacity fees, and market data. Net
transaction and clearing fees2 increased primarily as a
result of a 55 percent increase in index options trading volumes
versus the fourth quarter of 2021, along with a 4 percent increase
in index options revenue per contract ("RPC") for the quarter.
Access and capacity fees were 15 percent higher than fourth quarter
2021 and market data fees were 34 percent higher than fourth
quarter 2021.
- Net transaction and clearing fees2 increased
$65.9 million, or 41 percent,
reflecting a 15 percent increase in total options average daily
volume ("ADV") and a 25 percent increase in total options RPC
compared to the fourth quarter 2021. The increase in total options
RPC was due to a mix shift, with index options representing a
higher percentage of total options volume. The RPC for index
options increased 4 percent as higher-priced SPX options accounted
for a higher percentage of index options volume.
- Cboe's Options exchanges had total market share of 34.1 percent
for the fourth quarter of 2022 compared to 31.1 percent in the
fourth quarter of 2021, primarily reflecting an increase in Cboe's
multi-listed options market share for the quarter of 28.5 percent
compared to 27.3 percent in the fourth quarter of 2021.
North American (N.A.) Equities:
- N.A. Equities net revenue of $96.4
million was up $4.8 million,
or 5 percent. The increase was primarily due to a $5.5 million fourth quarter net revenue
contribution from the 2022 acquisition of NEO and higher access and
capacity fees, partially offset by lower transaction and clearing
fees and industry market data revenue.
- Net transaction and clearing fees2 decreased by
$1.2 million, or 4 percent, as
compared to the fourth quarter of 2021. The decrease was primarily
due to lower U.S. Equities off-exchange revenue, a result of lower
volumes and slightly lower net capture and market share trends
versus the fourth quarter of 2021. U.S. Equities exchange revenues
benefited from a 4 percent increase in U.S. Equities industry
volumes, offsetting a 2 percent decline in net capture.
- Cboe's U.S. Equities exchanges had market share of 13.1 percent
for the fourth quarter of 2022 compared to 13.3 percent in the
fourth quarter of 2021. U.S. Equities off-exchange market share was
21.5 percent versus 22.5 percent in the fourth quarter of 2021.
Canadian Equities market share rose to 13.6 percent as compared to
3.3 percent in the fourth quarter of 2021 given the inclusion of
NEO.
Europe and Asia Pacific (APAC):
- Europe and APAC net revenue of
$44.2 million decreased by 15
percent, reflecting continued currency headwinds. On a constant
currency basis2, net revenues were $49.8 million, down 4 percent on a year-over-year
basis. European Equities average daily notional value ("ADNV")
traded on Cboe European Equities was €10.0 billion, up 14 percent
compared to the fourth quarter of 2021, outperforming a 9 percent
decline in industry market volumes. Net capture decreased 13
percent for the quarter, reflecting a mix shift with the strongest
market share gains coming in Lit markets, outpacing the growth in
higher-capture Cboe BIDS Europe and Periodic Auction services, as
well as greater industry volume declines in higher-priced block
activity relative to Lit markets.
- For the fourth quarter of 2022, Cboe European Equities had 24.9
percent market share, up from 19.8 percent in the fourth quarter of
2021, as a result of positive momentum across all orderbooks,
making Cboe the largest stock exchange and block trading venue in
Europe in the fourth quarter of
2022.
Futures:
- Futures net revenue of $26.8
million decreased $3.1
million, or 10 percent, due to a decline in net transaction
and clearing fees2, offset slightly by an increase in
market data fees.
- Net transaction and clearing fees2 decreased
$3.7 million, reflecting a 16 percent
decline in volumes during the quarter.
Global FX:
- Global FX net revenue of $16.9
million increased 14 percent, primarily as a result of
higher net transaction and clearing fees2. ADNV traded
on the Cboe FX platform was $40.8
billion for the quarter, up 21 percent compared to last
year's fourth quarter, and net capture per one million dollars traded was $2.69 for the quarter, down 3 percent compared to
$2.77 in the fourth quarter of
2021.
- Cboe FX market share was 18.4 percent for the quarter compared
to 16.8 percent in last year's fourth quarter, which is a quarterly
record for Cboe FX. The increase was driven by the continued
adoption of our diverse set of FX order types and trading
protocols.
(1)The Digital and Corporate
segments are not further discussed as results were not material
during the fourth quarter of 2022.
|
(2)A full reconciliation of our
non-GAAP results to our GAAP results is included in the attached
tables. See "Non-GAAP Information" in the accompanying financial
tables.
|
2023 Fiscal Year Financial Guidance
Cboe provided guidance for the 2023 fiscal year as noted
below.
- Organic total net revenue growth1 is expected to be
in the range of 7 to 9 percentage points in 2023, above medium-term
organic total net revenue1 guidance expectations of 5 to
7 percentage points.
- Revenue from acquisitions held less than a year1 is
expected to contribute total net revenue growth of 0.5 percentage
points in 2023.
- Organic net revenue1 from Data and Access Solutions
is expected to increase by approximately 7 to 10 percentage points
in 2023, in line with medium-term guidance expectations.
- Adjusted operating expenses1 in 2023 are expected to
be in the range of $769 to
$779 million, from a base of
$652 million in 2022. The guidance
excludes the expected amortization of acquired intangible assets of
$112 million; the company plans to
reflect the exclusion of this amount in its non-GAAP
reconciliation.
- Depreciation and amortization expense for 2023, which is
included in adjusted operating expenses above, is expected to be in
the range of $48 to $52 million, excluding the expected amortization
of acquired intangible assets.
- Other income (expense), net, is expected to contribute a
$27 to $33
million benefit in 2023 given expected performance of
minority investments.
- The effective tax rate1 on adjusted earnings for the
full year 2023 is expected to be in the range of 28.5 to 30.5
percent. Significant changes in trading volume, expenses, tax laws
or rates and other items could materially impact this
expectation.
- Capital expenditures for 2023 are expected to be in the range
of $60 to $66
million.
(1) Specific
quantifications of the amounts that would be required to reconcile
the company's organic and inorganic growth guidance, adjusted
operating expenses guidance and the effective tax rate on adjusted
earnings guidance are not available. Acquisitions are considered
organic after 12 months of closing. The company believes that
there is uncertainty and unpredictability with respect to certain
of its GAAP measures, primarily related to acquisition-related
revenues and expenses that would be required to reconcile to GAAP
revenues less cost of revenues, GAAP operating expenses and GAAP
effective tax rate, which preclude the company from providing
accurate guidance on certain forward-looking GAAP to non-GAAP
reconciliations. The company believes that providing estimates of
the amounts that would be required to reconcile the range of the
company's organic growth, adjusted operating expenses and the
effective tax rate on adjusted earnings would imply a degree of
precision that would be confusing or misleading to investors for
the reasons identified above.
|
Capital Management
At December 31, 2022, the company
had adjusted cash2 of $403.2
million. Total debt as of December
31, 2022 was $1,742.0 million,
a decrease of $117.8 million from
September 30, 2022.
The company paid cash dividends of $53.4
million, or $0.50 per share,
during the fourth quarter of 2022 and utilized $15.3 million to repurchase 132 thousand shares
of its common stock under its share repurchase program at an
average price of $116.07 per share.
As of December 31, 2022, the company
had approximately $217.9 million of
availability remaining under its existing share repurchase
authorizations.
Earnings Conference Call
Executives of Cboe Global Markets will host a conference call to
review its fourth-quarter financial results today, February 3, 2023, at 8:30 a.m.
ET/7:30 a.m. CT. The conference call and any accompanying
slides will be publicly available via live webcast from the
Investor Relations section of the company's website at www.cboe.com
under Events & Presentations. Participants may also listen
via telephone by dialing (877) 255–4313 from the United States, (866) 450–4696 from
Canada or (412) 317–5466 for
international callers. Telephone participants should place calls 10
minutes prior to the start of the call. The webcast will be
archived on the company's website for replay. A telephone replay of
the earnings call also will be available from approximately
11:00 a.m. CT, February 3, 2023,
through 11:00 p.m. CT, February 10,
2023, by calling (877) 344–7529 from the U.S., (855)
669–9658 from Canada or (412)
317–0088 for international callers, using replay code 10160639.
(2)
A full reconciliation of our non-GAAP results to our GAAP
results is included in the attached tables. See "Non-GAAP
Information" in the accompanying financial tables.
|
About Cboe Global Markets
Cboe Global Markets (Cboe: CBOE), a leading provider of market
infrastructure and tradable products, delivers cutting-edge
trading, clearing and investment solutions to market participants
around the world. The Company is committed to operating a trusted,
inclusive global marketplace, and to providing leading products,
technology and data solutions that enable participants to define a
sustainable financial future. Cboe provides trading solutions and
products in multiple asset classes, including equities,
derivatives, FX, and digital assets, across North America, Europe, and Asia
Pacific. To learn more, visit www.cboe.com.
Cautionary Statements Regarding Forward-Looking
Information
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995
that involve a number of risks and uncertainties. You can identify
these statements by forward-looking words such as "may," "might,"
"should," "expect," "plan," "anticipate," "believe," "estimate,"
"predict," "potential" or "continue," and the negative of these
terms and other comparable terminology. All statements that reflect
our expectations, assumptions or projections about the future other
than statements of historical fact are forward-looking statements.
These forward-looking statements, which are subject to known and
unknown risks, uncertainties and assumptions about us, may include
projections of our future financial performance based on our growth
strategies and anticipated trends in our business. These statements
are only predictions based on our current expectations and
projections about future events. There are important factors that
could cause our actual results, level of activity, performance or
achievements to differ materially from those expressed or implied
by the forward-looking statements.
We operate in a very competitive and rapidly changing
environment. New risks and uncertainties emerge from time to time,
and it is not possible to predict all risks and uncertainties, nor
can we assess the impact of all factors on our business or the
extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any
forward-looking statements.
Some factors that could cause actual results to differ include:
the loss of our right to exclusively list and trade certain index
options and futures products; economic, political and market
conditions; compliance with legal and regulatory obligations; price
competition and consolidation in our industry; decreases in trading
or clearing volumes, market data fees or a shift in the mix of
products traded on our exchanges; legislative or regulatory changes
or changes in tax regimes; our ability to protect our systems and
communication networks from security risks, cybersecurity risks,
insider threats and unauthorized disclosure of confidential
information; our ability to attract and retain skilled management
and other personnel, including compensation inflation; increasing
competition by foreign and domestic entities; our dependence on and
exposure to risk from third parties; fluctuations to currency
exchange rates; factors that impact the quality and integrity of
our indices; the impact of the novel coronavirus ("COVID-19")
pandemic; our ability to operate our business without violating the
intellectual property rights of others and the costs associated
with protecting our intellectual property rights; our ability to
minimize the risks, including our credit and default risks,
associated with operating a European clearinghouse; our ability to
accommodate trading and clearing volume and transaction traffic,
including significant increases, without failure or degradation of
performance of our systems; misconduct by those who use our markets
or our products or for whom we clear transactions; challenges to
our use of open source software code; our ability to meet our
compliance obligations, including managing potential conflicts
between our regulatory responsibilities and our for-profit status;
our ability to maintain BIDS Trading as an independently managed
and operated trading venue, separate from and not integrated with
our registered national securities exchanges; damage to our
reputation; the ability of our compliance and risk management
methods to effectively monitor and manage our risks; our ability to
manage our growth and strategic acquisitions or alliances
effectively; restrictions imposed by our debt obligations and our
ability to make payments on or refinance our debt obligations; our
ability to maintain an investment grade credit rating; impairment
of our goodwill, long-lived assets, investments or intangible
assets; the accuracy of our estimates and expectations; litigation
risks and other liabilities; and operating a digital asset business
and clearinghouse, including the expected benefits of our ErisX
acquisition, subsequently rebranded to Cboe Digital, cybercrime,
changes in digital asset regulation, losses due to digital asset
custody, and fluctuations in digital asset prices. More detailed
information about factors that may affect our actual results to
differ may be found in our filings with the SEC, including in our
Annual Report on Form 10-K for the year ended December 31, 2021 and other filings made from
time to time with the SEC.
We do not undertake, and we expressly disclaim, any duty to
update any forward-looking statement whether as a result of new
information, future events or otherwise, except as required by law.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date
hereof.
The condensed consolidated statements of income and balance
sheets are unaudited and subject to revision.
|
|
|
|
|
Cboe Media
Contacts:
|
|
|
|
Analyst
Contact:
|
Angela Tu
|
|
Tim Cave
|
|
Kenneth Hill,
CFA
|
(646)
856–8734
|
|
+44 (0) 7593 506
719
|
|
(312)
786–7559
|
atu@cboe.com
|
|
tcave@cboe.com
|
|
khill@cboe.com
|
CBOE-F
Trademarks:
Cboe®, Cboe Global Markets®, Cboe Volatility Index®, Bats®, BIDS
Trading®, BZX®, BYX®, Chi-X®, Cboe Clear Europe®, EDGX®, EDGA®,
ErisX®, EuroCCP®, MATCHNow®, and VIX® are registered trademarks of
Cboe Global Markets, Inc. and its subsidiaries. All other
trademarks and service marks are the property of their respective
owners.
Cboe Global
Markets, Inc.
Key Performance
Statistics by Business Segment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4Q 2022
|
3Q
2022
|
2Q
2022
|
1Q
2022
|
4Q 2021
|
Options
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total industry ADV (in
thousands)
|
|
|
42,694
|
|
|
39,947
|
|
|
39,377
|
|
|
42,464
|
|
|
40,794
|
|
Total Company
Options ADV (in thousands)
|
|
|
14,545
|
|
|
13,521
|
|
|
13,054
|
|
|
13,392
|
|
|
12,694
|
|
Multi-listed
options
|
|
|
11,186
|
|
|
10,592
|
|
|
10,378
|
|
|
10,978
|
|
|
10,527
|
|
Index
options
|
|
|
3,359
|
|
|
2,929
|
|
|
2,677
|
|
|
2,414
|
|
|
2,167
|
|
Total Options market
share
|
|
|
34.1
|
%
|
|
33.8
|
%
|
|
33.2
|
%
|
|
31.5
|
%
|
|
31.1
|
%
|
Multi-listed
options
|
|
|
28.5
|
%
|
|
28.6
|
%
|
|
28.3
|
%
|
|
27.4
|
%
|
|
27.3
|
%
|
Total Options
RPC:
|
|
$
|
0.248
|
|
$
|
0.242
|
|
$
|
0.233
|
|
$
|
0.210
|
|
$
|
0.199
|
|
Multi-listed
options
|
|
$
|
0.060
|
|
$
|
0.061
|
|
$
|
0.066
|
|
$
|
0.067
|
|
$
|
0.066
|
|
Index
options
|
|
$
|
0.876
|
|
$
|
0.896
|
|
$
|
0.883
|
|
$
|
0.857
|
|
$
|
0.845
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North American
Equities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Equities -
Exchange:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total industry ADV
(shares in billions)
|
|
|
11.2
|
|
|
10.9
|
|
|
12.6
|
|
|
12.9
|
|
|
10.8
|
|
Market share
%
|
|
|
13.1
|
%
|
|
13.3
|
%
|
|
13.6
|
%
|
|
14.3
|
%
|
|
13.3
|
%
|
Net capture (per 100
touched shares)
|
|
$
|
0.024
|
|
$
|
0.023
|
|
$
|
0.020
|
|
$
|
0.017
|
|
$
|
0.025
|
|
U.S. Equities -
Off-Exchange:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADV (touched shares, in
millions)
|
|
|
80.8
|
|
|
80.1
|
|
|
92.7
|
|
|
108.5
|
|
|
84.2
|
|
Off-Exchange ATS Block
Market Share % (reported on a two-month lag)
|
|
|
21.5
|
%
|
|
21.7
|
%
|
|
22.7
|
%
|
|
24.4
|
%
|
|
22.5
|
%
|
Net capture (per 100
touched shares)
|
|
$
|
0.113
|
|
$
|
0.114
|
|
$
|
0.108
|
|
$
|
0.117
|
|
$
|
0.115
|
|
Canadian
Equities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADV (matched shares, in
millions)
|
|
|
139.0
|
|
|
113.2
|
|
|
73.7
|
|
|
41.1
|
|
|
41.3
|
|
Total market share
%
|
|
|
13.6
|
%
|
|
12.2
|
%
|
|
6.4
|
%
|
|
3.2
|
%
|
|
3.3
|
%
|
Net capture (per 10,000
shares, in Canadian Dollars)
|
|
$
|
3.901
|
|
$
|
4.316
|
|
$
|
5.668
|
|
$
|
9.103
|
|
$
|
8.475
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe and Asia
Pacific
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
European
Equities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total industry ADNV
(Euros - in billions)
|
|
€
|
40.1
|
|
€
|
39.2
|
|
€
|
46.9
|
|
€
|
58.7
|
|
€
|
44.0
|
|
Market share
%
|
|
|
24.9
|
%
|
|
24.6
|
%
|
|
23.2
|
%
|
|
21.8
|
%
|
|
19.8
|
%
|
Net capture
(bps)
|
|
€
|
0.224
|
|
€
|
0.229
|
|
€
|
0.238
|
|
€
|
0.233
|
|
€
|
0.256
|
|
Cboe Clear
Europe:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trades cleared (in
thousands)
|
|
|
340,932.2
|
|
|
341,549.2
|
|
|
356,351.1
|
|
|
454,437.8
|
|
|
345,074.8
|
|
Fee per trade
cleared
|
|
€
|
0.008
|
|
€
|
0.008
|
|
€
|
0.009
|
|
€
|
0.009
|
|
€
|
0.011
|
|
Net settlement volume
(shares in thousands)
|
|
|
2,490.5
|
|
|
2,546.8
|
|
|
2,501.6
|
|
|
2,802.1
|
|
|
2,664.9
|
|
Net fee per
settlement
|
|
€
|
0.886
|
|
€
|
0.902
|
|
€
|
0.808
|
|
€
|
0.924
|
|
€
|
0.860
|
|
Australian
Equities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADNV (AUD
billions)
|
|
$
|
0.7
|
|
$
|
0.7
|
|
$
|
0.8
|
|
$
|
0.9
|
|
$
|
0.8
|
|
Market share -
Continuous
|
|
|
17.2
|
%
|
|
16.7
|
%
|
|
17.0
|
%
|
|
15.8
|
%
|
|
16.1
|
%
|
Net capture (per
matched notional value (bps), in Australian Dollars)
|
|
$
|
0.142
|
|
$
|
0.168
|
|
$
|
0.171
|
|
$
|
0.173
|
|
$
|
0.171
|
|
Japanese
Equities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADNV (JPY
billions)
|
|
¥
|
114.1
|
|
¥
|
160.6
|
|
¥
|
136.0
|
|
¥
|
161.8
|
|
¥
|
111.4
|
|
Market share - Lit
Continuous
|
|
|
2.9
|
%
|
|
4.4
|
%
|
|
3.5
|
%
|
|
3.8
|
%
|
|
2.9
|
%
|
Net capture (per
matched notional value (bps))
|
|
¥
|
0.265
|
|
¥
|
0.259
|
|
¥
|
0.258
|
|
¥
|
0.228
|
|
¥
|
0.358
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Futures
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADV (in
thousands)
|
|
|
193
|
|
|
205
|
|
|
222
|
|
|
254
|
|
|
230
|
|
RPC
|
|
$
|
1.689
|
|
$
|
1.700
|
|
$
|
1.677
|
|
$
|
1.637
|
|
$
|
1.651
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global
FX
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market share
%
|
|
|
18.4
|
%
|
|
17.8
|
%
|
|
17.0
|
%
|
|
17.3
|
%
|
|
16.8
|
%
|
ADNV ($ in
billions)
|
|
$
|
40.8
|
|
$
|
41.3
|
|
$
|
39.6
|
|
$
|
42.0
|
|
$
|
33.7
|
|
Net capture (per one
million dollars traded)
|
|
$
|
2.69
|
|
$
|
2.69
|
|
$
|
2.71
|
|
$
|
2.67
|
|
$
|
2.77
|
|
ADV = average daily volume; ADNV = average daily notional
value.
RPC, average revenue per contract, for options and futures
represents total net transaction fees recognized for the period
divided by total contracts traded during the period.
Touched volume represents the total number of shares of equity
securities and ETFs internally matched on our exchanges or routed
to and executed on an external market center.
Matched volume represents the total number of shares of equity
securities and ETFs executed on our exchanges.
U.S. Equities - Exchange, "net capture per 100 touched shares"
refers to transaction fees less liquidity payments and routing and
clearing costs divided by the product of one-hundredth ADV of
touched shares on BZX, BYX, EDGX and EDGA and the number of
trading days. U.S. Equities – Off-Exchange data reflects BIDS
Trading. For U.S. Equities – Off-Exchange, "net capture per 100
touched shares" refers to transaction fees less order and execution
management system (OMS/EMS) fees and clearing costs divided by the
product of one-hundredth ADV of touched shares on BIDS Trading and
the number of trading days for the period.
Canadian Equities, "net capture per 10,000 shares" refers to
transaction fees divided by the product of one-ten thousandth ADV
of shares for MATCHNow and NEO and the number of trading days.
Total market share represents MATCHNow and NEO volume divided by
the total volume of the Canadian Equities market.
European Equities, "net capture per matched notional value"
refers to transaction fees less liquidity payments in Euros divided
by the product of ADNV in Euros of shares matched on Cboe Europe
Equities and the number of trading days. "Trades cleared" refers to
the total number of non-interoperable trades cleared, "Fee per
trade cleared" refers to clearing fees divided by number of
non-interoperable trades cleared, "Net settlement volume" refers to
the total number of settlements executed after netting, and "Net
fee per settlement" refers to settlement fees less direct costs
incurred to settle divided by the number of settlements executed
after netting. Asia Pacific data
reflects the acquisition of Cboe Asia Pacific (formerly Chi-X Asia
Pacific) effective July 1, 2021.
Australian Equities "Net capture per matched notional value" refers
to transaction fees less liquidity payments in Australian dollars
divided by the product of ADNV in Australian dollars of shares
matched on Cboe Australia and the number of Australian Equities
trading days. Japanese Equities "Net capture per matched notional
value" refers to transaction fees less liquidity payments in
Japanese Yen divided by the product of ADNV in Japanese Yen of
shares matched on Cboe Japan and the number of Japanese Equities
trading days.
Global FX, "net capture per one million
dollars traded" refers to transaction fees less liquidity
payments, if any, divided by the Spot and SEF products of
one-thousandth of ADNV traded on the Cboe FX Markets and the number
of trading days, divided by two, which represents the buyer and
seller that are both charged on the transaction. Market Share
represents Cboe FX volume divided by the total volume of publicly
reporting spot FX venues (Cboe FX, EBS, Refinitiv, and Euronext
FX).
Average transaction fees per contract can be affected by various
factors, including exchange fee rates, volume-based discounts and
transaction mix by contract type and product type.
Cboe Global Markets,
Inc. and Subsidiaries
Condensed
Consolidated Statements of Income (Unaudited)
Three and Twelve
Months Ended December 31, 2022 and 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended December 31,
|
|
Twelve Months Ended
December 31,
|
(in millions, except
per share amounts)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and spot
markets
|
|
$
|
423.0
|
|
$
|
381.6
|
|
$
|
1,777.6
|
|
$
|
1,660.5
|
Data and access
solutions
|
|
|
128.1
|
|
|
113.8
|
|
|
497.0
|
|
|
427.7
|
Derivatives
markets
|
|
|
453.6
|
|
|
371.0
|
|
|
1,683.9
|
|
|
1,406.6
|
Total
Revenues
|
|
|
1,004.7
|
|
|
866.4
|
|
|
3,958.5
|
|
|
3,494.8
|
Cost of
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidity
payments
|
|
|
381.4
|
|
|
395.7
|
|
|
1,670.2
|
|
|
1,650.7
|
Routing and
clearing
|
|
|
19.8
|
|
|
21.8
|
|
|
83.2
|
|
|
87.8
|
Section 31
fees
|
|
|
109.1
|
|
|
31.0
|
|
|
329.8
|
|
|
179.6
|
Royalty fees
|
|
|
34.4
|
|
|
23.7
|
|
|
120.0
|
|
|
86.3
|
Other cost of
revenues
|
|
|
2.9
|
|
|
3.7
|
|
|
13.6
|
|
|
14.3
|
Total Cost of
Revenues
|
|
|
547.6
|
|
|
475.9
|
|
|
2,216.8
|
|
|
2,018.7
|
Revenues Less Cost
of Revenues
|
|
|
457.1
|
|
|
390.5
|
|
|
1,741.7
|
|
|
1,476.1
|
Operating
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation and
benefits
|
|
|
93.6
|
|
|
74.5
|
|
|
363.0
|
|
|
288.5
|
Depreciation and
amortization
|
|
|
44.7
|
|
|
42.0
|
|
|
166.8
|
|
|
167.4
|
Technology support
services
|
|
|
21.3
|
|
|
16.6
|
|
|
77.7
|
|
|
66.7
|
Professional fees and
outside services
|
|
|
24.8
|
|
|
21.7
|
|
|
89.0
|
|
|
83.7
|
Travel and promotional
expenses
|
|
|
9.2
|
|
|
3.9
|
|
|
23.7
|
|
|
9.7
|
Facilities
costs
|
|
|
5.8
|
|
|
5.7
|
|
|
25.1
|
|
|
22.2
|
Acquisition-related
costs
|
|
|
2.0
|
|
|
3.7
|
|
|
19.9
|
|
|
15.6
|
Goodwill
impairment
|
|
|
—
|
|
|
—
|
|
|
460.9
|
|
|
—
|
Other
expenses
|
|
|
5.2
|
|
|
1.8
|
|
|
26.0
|
|
|
16.4
|
Total Operating
Expenses
|
|
|
206.6
|
|
|
169.9
|
|
|
1,252.1
|
|
|
670.2
|
Operating
Income
|
|
|
250.5
|
|
|
220.6
|
|
|
489.6
|
|
|
805.9
|
Non-operating Income
(Expenses):
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense,
net
|
|
|
(15.7)
|
|
|
(11.1)
|
|
|
(56.4)
|
|
|
(47.4)
|
Other income (expense),
net
|
|
|
1.0
|
|
|
0.7
|
|
|
(0.3)
|
|
|
(2.4)
|
Total Non-operating
Expenses
|
|
|
(14.7)
|
|
|
(10.4)
|
|
|
(56.7)
|
|
|
(49.8)
|
Income Before Income
Tax Provision
|
|
|
235.8
|
|
|
210.2
|
|
|
432.9
|
|
|
756.1
|
Income tax
provision
|
|
|
76.1
|
|
|
44.3
|
|
|
197.9
|
|
|
227.1
|
Net
Income
|
|
|
159.7
|
|
|
165.9
|
|
|
235.0
|
|
|
529.0
|
Net income allocated to
participating securities
|
|
|
(0.7)
|
|
|
(0.6)
|
|
|
(0.9)
|
|
|
(1.7)
|
Net Income Allocated
to Common Stockholders
|
|
$
|
159.0
|
|
$
|
165.3
|
|
$
|
234.1
|
|
$
|
527.3
|
Net Income Per Share
Allocated to Common Stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per
share
|
|
$
|
1.50
|
|
$
|
1.55
|
|
$
|
2.20
|
|
$
|
4.93
|
Diluted earnings per
share
|
|
|
1.49
|
|
|
1.54
|
|
|
2.19
|
|
|
4.92
|
Weighted average shares
used in computing earnings per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
106.2
|
|
|
106.8
|
|
|
106.3
|
|
|
107.0
|
Diluted
|
|
|
106.5
|
|
|
107.1
|
|
|
106.7
|
|
|
107.2
|
Cboe Global Markets,
Inc. and Subsidiaries
Condensed
Consolidated Balance Sheets (Unaudited)
December 31, 2022
and December 31, 2021
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
|
|
December 31,
|
(in
millions)
|
|
2022
|
|
2021
|
Assets
|
|
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
432.7
|
|
$
|
341.9
|
Financial
investments
|
|
|
91.7
|
|
|
37.1
|
Accounts receivable,
net
|
|
|
369.8
|
|
|
326.9
|
Margin deposits and
clearing funds
|
|
|
543.0
|
|
|
745.9
|
Digital assets -
safeguarded assets
|
|
|
22.9
|
|
|
—
|
Income taxes
receivable
|
|
|
48.3
|
|
|
42.7
|
Other current
assets
|
|
|
47.6
|
|
|
36.8
|
Total Current
Assets
|
|
|
1,556.0
|
|
|
1,531.3
|
|
|
|
|
|
|
|
Investments
|
|
|
253.2
|
|
|
245.8
|
Land
|
|
|
2.3
|
|
|
2.3
|
Property and equipment,
net
|
|
|
108.2
|
|
|
105.2
|
Operating lease right
of use assets
|
|
|
111.7
|
|
|
110.1
|
Goodwill
|
|
|
3,122.8
|
|
|
3,025.4
|
Intangible assets,
net
|
|
|
1,662.8
|
|
|
1,668.6
|
Other assets,
net
|
|
|
181.9
|
|
|
125.8
|
Total
Assets
|
|
$
|
6,998.9
|
|
$
|
6,814.5
|
|
|
|
|
|
|
|
Liabilities and
Stockholders' Equity
|
|
|
|
|
|
|
Current
Liabilities:
|
|
|
|
|
|
|
Accounts payable and
accrued liabilities
|
|
$
|
420.2
|
|
$
|
295.4
|
Section 31 fees
payable
|
|
|
147.1
|
|
|
40.8
|
Deferred
revenue
|
|
|
11.7
|
|
|
15.2
|
Margin deposits and
clearing funds
|
|
|
543.0
|
|
|
745.9
|
Income taxes
payable
|
|
|
3.5
|
|
|
8.2
|
Digital assets -
safeguard liabilities
|
|
|
22.9
|
|
|
—
|
Current portion of
long-term debt
|
|
|
304.7
|
|
|
—
|
Current portion of
contingent consideration liabilities
|
|
|
24.1
|
|
|
63.8
|
Total Current
Liabilities
|
|
|
1,477.2
|
|
|
1,169.3
|
|
|
|
|
|
|
|
Long-term
debt
|
|
|
1,437.3
|
|
|
1,299.3
|
Non-current
unrecognized tax benefits
|
|
|
196.1
|
|
|
197.9
|
Deferred income
taxes
|
|
|
222.9
|
|
|
372.7
|
Non-current operating
lease liabilities
|
|
|
129.3
|
|
|
129.2
|
Non-current portion of
contingent consideration liabilities
|
|
|
15.0
|
|
|
6.7
|
Other non-current
liabilities
|
|
|
55.8
|
|
|
34.6
|
Total
Liabilities
|
|
|
3,533.6
|
|
|
3,209.7
|
|
|
|
|
|
|
|
Stockholders'
Equity:
|
|
|
|
|
|
|
Preferred
stock
|
|
|
—
|
|
|
—
|
Common stock
|
|
|
1.1
|
|
|
1.1
|
Treasury stock at
cost
|
|
|
(131.0)
|
|
|
(106.8)
|
Additional
paid-in-capital
|
|
|
1,455.1
|
|
|
1,509.4
|
Retained
earnings
|
|
|
2,171.1
|
|
|
2,145.5
|
Accumulated other
comprehensive (loss) income, net
|
|
|
(31.0)
|
|
|
55.6
|
Total Stockholders'
Equity
|
|
|
3,465.3
|
|
|
3,604.8
|
|
|
|
|
|
|
|
Total Liabilities
and Stockholders' Equity
|
|
$
|
6,998.9
|
|
$
|
6,814.5
|
Non-GAAP Information
In addition to disclosing results determined in accordance with
GAAP, Cboe Global Markets has disclosed certain non-GAAP measures
of operating performance. These measures are not in accordance
with, or a substitute for, GAAP, and may be different from or
inconsistent with non-GAAP financial measures used by other
companies. The non-GAAP measures provided in this press release
include net transaction and clearing fees, adjusted operating
expenses, adjusted operating income, organic net revenue, inorganic
net revenue, net revenues on a constant currency basis, and
adjusted operating margin, adjusted net income allocated to common
stockholders and adjusted diluted earnings per share, effective tax
rate on adjusted earnings, net revenues on a constant currency
basis, adjusted cash, EBITDA, EBITDA margin, adjusted EBITDA and
adjusted EBITDA margin.
Management believes that the non-GAAP financial measures
presented in this press release provide additional and comparative
information to assess trends in our core operations and a means to
evaluate period-to-period comparisons. Non-GAAP financial measures
disclosed by management are provided as additional information to
investors in order to provide them with an alternative method for
assessing our financial condition and operating results.
Organic net revenue, inorganic net revenue, organic
non-transaction revenue and organic net revenue
guidance: These are non-GAAP financial measures that
exclude or have otherwise been adjusted for the impact of our
acquisitions for the period or guidance, as applicable. Management
believes the organic net revenue growth and guidance measures
provide users with supplemental information regarding the company's
ongoing and future potential revenue performances and trends by
presenting revenue growth and guidance excluding the impact of the
acquisitions. Revenues from acquisitions that have been owned for
at least one year are considered organic and are no longer excluded
from organic net revenue from either period for comparative
purposes.
Amortization expense of acquired intangible assets: We
amortize intangible assets acquired in connection with various
acquisitions. Amortization of intangible assets is inconsistent in
amount and frequency and is significantly affected by the timing
and size of our acquisitions. As such, if intangible asset
amortization is included in performance measures, it is more
difficult to assess the day-to-day operating performance of the
businesses, the relative operating performance of the businesses
between periods and the earnings power of the company. Therefore,
we believe performance measures excluding intangible asset
amortization expense provide investors with an additional basis for
comparison across accounting periods.
Acquisition-related expenses: From time to time, we have
pursued acquisitions, which have resulted in expenses which would
not otherwise have been incurred in the normal course of the
company's business operations. These expenses include integration
costs, as well as legal, due diligence, impairment charges, and
other third-party transaction costs. The frequency and the amount
of such expenses vary significantly based on the size, timing and
complexity of the transaction. Accordingly, we exclude these costs
for purposes of calculating non-GAAP measures which provide an
additional analysis of Cboe's ongoing operating performance or
comparisons in Cboe's performance between periods.
The tables below show the reconciliation of each financial
measure from GAAP to non-GAAP. The non-GAAP financial measures
exclude the impact of those items detailed below and are referred
to as adjusted financial measures.
Organic Net Revenue
Reconciliation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table
3
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
(in
millions)
|
|
December 31,
|
|
December 31,
|
|
Reconciliation of
Revenues Less Cost of Revenues to Organic Net
Revenue
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
Revenues less cost of
revenues (net revenue)
|
|
$
|
457.1
|
|
$
|
390.5
|
|
$
|
1,741.7
|
|
$
|
1,476.1
|
|
Less
acquisitions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition revenues
less cost of revenues (inorganic net revenue)
|
|
$
|
(5.1)
|
|
$
|
—
|
|
$
|
(28.7)
|
|
$
|
—
|
|
Organic net
revenue
|
|
$
|
452.0
|
|
$
|
390.5
|
|
$
|
1,713.0
|
|
$
|
1,476.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
GAAP and non-GAAP Information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Twelve Months
Ended
|
|
Table
4
|
|
December 31,
|
|
December 31,
|
|
(in millions, except
per share amounts)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
Reconciliation of
Net Income Allocated to Common Stockholders to
Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(As shown on Table
1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income allocated to
common stockholders
|
|
$
|
159.0
|
|
$
|
165.3
|
|
$
|
234.1
|
|
$
|
527.3
|
|
Non-GAAP
adjustments
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
expenses (1)
|
|
|
2.0
|
|
|
3.7
|
|
|
19.9
|
|
|
15.6
|
|
Investment
establishment costs (2)
|
|
|
—
|
|
|
—
|
|
|
3.0
|
|
|
—
|
|
Gain on investment
(3)
|
|
|
—
|
|
|
—
|
|
|
(7.5)
|
|
|
—
|
|
Loan forgiveness
(4)
|
|
|
—
|
|
|
—
|
|
|
(1.3)
|
|
|
—
|
|
Amortization of
acquired intangible assets (5)
|
|
|
33.2
|
|
|
31.4
|
|
|
124.3
|
|
|
126.6
|
|
Goodwill impairment
(6)
|
|
|
—
|
|
|
—
|
|
|
460.9
|
|
|
—
|
|
Impairment of
investment (7)
|
|
|
—
|
|
|
—
|
|
|
10.6
|
|
|
5.0
|
|
Change in contingent
consideration (8)
|
|
|
(5.2)
|
|
|
(2.7)
|
|
|
(5.2)
|
|
|
(2.7)
|
|
Total Non-GAAP
adjustments
|
|
|
30.0
|
|
|
32.4
|
|
|
604.7
|
|
|
144.5
|
|
Income tax expense
related to the items above
|
|
|
5.3
|
|
|
(7.4)
|
|
|
(143.7)
|
|
|
(31.8)
|
|
Tax reserves
(9)
|
|
|
—
|
|
|
(5.4)
|
|
|
48.5
|
|
|
(5.4)
|
|
Deferred tax
re-measurements
|
|
|
(2.0)
|
|
|
(3.1)
|
|
|
(2.0)
|
|
|
14.6
|
|
Net income allocated to
participating securities - effect of reconciling
items
|
|
|
(0.1)
|
|
|
(0.1)
|
|
|
(1.8)
|
|
|
(0.4)
|
|
Adjusted net income
allocated to common stockholders
|
|
$
|
192.2
|
|
$
|
181.7
|
|
$
|
739.8
|
|
$
|
648.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Diluted EPS to Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
common share
|
|
$
|
1.49
|
|
$
|
1.54
|
|
$
|
2.19
|
|
$
|
4.92
|
|
Per share impact of
non-GAAP adjustments noted above
|
|
|
0.31
|
|
|
0.16
|
|
|
4.74
|
|
|
1.13
|
|
Adjusted diluted
earnings per common share
|
|
$
|
1.80
|
|
$
|
1.70
|
|
$
|
6.93
|
|
$
|
6.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Operating Margin to Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues less cost of
revenues
|
|
$
|
457.1
|
|
$
|
390.5
|
|
$
|
1,741.7
|
|
$
|
1,476.1
|
|
Non-GAAP adjustments
noted above
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Adjusted revenues
less cost of revenues
|
|
$
|
457.1
|
|
$
|
390.5
|
|
$
|
1,741.7
|
|
$
|
1,476.1
|
|
Operating expenses
(10)
|
|
$
|
206.6
|
|
$
|
169.9
|
|
$
|
1,252.1
|
|
$
|
670.2
|
|
Non-GAAP adjustments
noted above
|
|
|
30.0
|
|
|
32.4
|
|
|
599.9
|
|
|
139.5
|
|
Adjusted operating
expenses
|
|
$
|
176.6
|
|
$
|
137.5
|
|
$
|
652.2
|
|
$
|
530.7
|
|
Operating
income
|
|
$
|
250.5
|
|
$
|
220.6
|
|
$
|
489.6
|
|
$
|
805.9
|
|
Non-GAAP adjustments
noted above
|
|
|
30.0
|
|
|
32.4
|
|
|
599.9
|
|
|
139.5
|
|
Adjusted operating
income
|
|
$
|
280.5
|
|
$
|
253.0
|
|
$
|
1,089.5
|
|
$
|
945.4
|
|
Adjusted operating
margin (11)
|
|
|
61.4
|
%
|
|
64.8
|
%
|
|
62.6
|
%
|
|
64.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Income Tax Rate to Non-GAAP
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income
taxes
|
|
|
235.8
|
|
|
210.2
|
|
|
432.9
|
|
|
756.1
|
|
Non-GAAP adjustments
noted above
|
|
|
30.0
|
|
|
32.4
|
|
|
604.7
|
|
|
144.5
|
|
Adjusted income
before income taxes
|
|
$
|
265.8
|
|
$
|
242.6
|
|
$
|
1,037.6
|
|
$
|
900.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
expense
|
|
|
76.1
|
|
|
44.3
|
|
|
197.9
|
|
|
227.1
|
|
Non-GAAP adjustments
noted above
|
|
|
(3.3)
|
|
|
15.9
|
|
|
97.2
|
|
|
22.6
|
|
Adjusted income tax
expense
|
|
$
|
72.8
|
|
$
|
60.2
|
|
$
|
295.1
|
|
$
|
249.7
|
|
Adjusted income tax
rate
|
|
|
27.4
|
%
|
|
24.8
|
%
|
|
28.4
|
%
|
|
27.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) This amount
includes professional fees (which includes fees associated with the
valuation of the Cboe Digital goodwill impairment) and outside
services, related to the Company's acquisitions.
|
(2) This amount
represents the investment establishment costs related to the
company's investment in 7RIDGE Investments 3 LP, which acquired
Trading Technologies, Inc.
|
(3) This amount
represents the gain on the Company's investment in Eris Innovations
Holdings, LLC in connection with the full acquisition of Cboe
Digital (formerly ErisX).
|
(4) This amount
represents the forgiveness of a PPP ("Paycheck Protection Program")
loan previously held by Cboe Digital.
|
(5) This amount
represents the amortization of acquired intangible assets related
to the company's acquisitions.
|
(6) This amount
represents the impairment of Cboe Digital goodwill.
|
(7) This amount
represents the impairment of investment related to the Company's
investments in American Financial Exchange, LLC in 2022 and Curve
Global in 2021.
|
(8) This amount
represents the gain on change in contingent consideration related
to the acquisition of MATCHNow.
|
(9) This amount
represents the tax reserves related to Section 199
matters.
|
(10) The company
sponsors deferred compensation plans held in a trust. The expenses
or income related to the deferred compensation plans are included
in "Compensation and benefits" ($2.0 million and $1.8 million in
expense for the three months ended December 31, 2022 and 2021,
respectively, and $0.5 million and $3.5 million in expense for the
twelve months ended December, 2022 and 2021, respectively), and are
directly offset by deferred compensation income, expenses and
dividends included within "Other income, net" ($2.0 million and
$1.8 million in income, expense and dividends in the three months
ended December 31, 2022 and 2021, respectively, and $0.5 million
and $3.5 million in income, expense and dividends in the twelve
months ended December, 2022 and 2021, respectively), on the
condensed consolidated statements of income. The deferred
compensation plans' expenses are not excluded from "adjusted
operating expenses" and do not have an impact on "Income before
income taxes."
|
(11) Adjusted
operating margin represents adjusted operating income divided by
adjusted revenue less cost of revenue.
|
EBITDA Reconciliations
EBITDA (earnings before interest, income taxes, depreciation and
amortization) and Adjusted EBITDA are widely used non-GAAP
financial measures of operating performance. EBITDA margin
represents EBITDA divided by revenues less cost of revenues (net
revenue). It is presented as supplemental information that the
company believes is useful to investors to evaluate its results
because it excludes certain items that are not directly related to
the company's core operating performance. EBITDA is calculated by
adding back to net income interest expense, income tax expense,
depreciation and amortization. Adjusted EBITDA is calculated by
adding back to EBITDA acquisition-related expenses, change in
contingent consideration, gain on investment, loan forgiveness,
investment establishment costs, goodwill impairment, and impairment
of investment. EBITDA and Adjusted EBITDA should not be considered
as substitutes either for net income, as an indicator of the
company's operating performance, or for cash flow, as a measure of
the company's liquidity. In addition, because EBITDA and Adjusted
EBITDA may not be calculated identically by all companies, the
presentation here may not be comparable to other similarly titled
measures of other companies. Adjusted EBITDA margin represents
Adjusted EBITDA divided by net revenue.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table
5
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
(in
millions)
|
|
December 31,
|
|
December 31,
|
|
Reconciliation of
Net Income Allocated to Common Stockholders to EBITDA and Adjusted
EBITDA
(Per Table 1)
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
Net income allocated
to common stockholders
|
|
$
|
159.0
|
|
$
|
165.3
|
|
$
|
234.1
|
|
$
|
527.3
|
|
Interest expense,
net
|
|
|
15.7
|
|
|
11.1
|
|
|
56.4
|
|
|
47.4
|
|
Income tax
provision
|
|
|
76.1
|
|
|
44.3
|
|
|
197.9
|
|
|
227.1
|
|
Depreciation and
amortization
|
|
|
44.7
|
|
|
42.0
|
|
|
166.8
|
|
|
167.4
|
|
EBITDA
|
|
$
|
295.5
|
|
$
|
262.7
|
|
$
|
655.2
|
|
$
|
969.2
|
|
EBITDA
Margin
|
|
|
64.6
|
%
|
|
67.3
|
%
|
|
37.6
|
%
|
|
65.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP adjustments
not included in above line items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition-related
expenses
|
|
|
2.0
|
|
|
3.7
|
|
|
19.9
|
|
|
15.6
|
|
Investment
establishment costs
|
|
|
—
|
|
|
—
|
|
|
3.0
|
|
|
—
|
|
Gain on
investment
|
|
|
—
|
|
|
—
|
|
|
(7.5)
|
|
|
—
|
|
Loan
forgiveness
|
|
|
—
|
|
|
—
|
|
|
(1.3)
|
|
|
—
|
|
Change in contingent
consideration
|
|
|
(5.2)
|
|
|
(2.7)
|
|
|
(5.2)
|
|
|
(2.7)
|
|
Goodwill
impairment
|
|
|
—
|
|
|
—
|
|
|
460.9
|
|
|
—
|
|
Impairment of
investment
|
|
|
—
|
|
|
—
|
|
|
10.6
|
|
|
5.0
|
|
Adjusted
EBITDA
|
|
$
|
292.3
|
|
$
|
263.7
|
|
$
|
1,135.6
|
|
$
|
987.1
|
|
Adjusted EBITDA
Margin
|
|
|
63.9
|
%
|
|
67.5
|
%
|
|
65.2
|
%
|
|
66.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table
6
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
|
December 31,
|
|
December 31,
|
|
|
|
|
|
|
|
Reconciliation of
Cash and cash equivalents to Adjusted Cash
|
|
2022
|
|
2021
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
432.7
|
|
$
|
341.9
|
|
|
|
|
|
|
|
Financial
investments
|
|
|
91.7
|
|
|
37.1
|
|
|
|
|
|
|
|
Less deferred
compensation plan assets
|
|
|
(27.5)
|
|
|
(28.0)
|
|
|
|
|
|
|
|
Less cash collected for
Section 31 Fees
|
|
|
(93.7)
|
|
|
(25.9)
|
|
|
|
|
|
|
|
Adjusted
Cash
|
|
$
|
403.2
|
|
$
|
325.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table
7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Net Transaction and Clearing Fees - Three Months Ended December 31,
2022 and 2021
|
|
Consolidated
|
|
Options
|
|
N.A.
Equities
|
|
Europe and
APAC
|
|
Futures
|
|
Global
FX
|
|
Digital
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Transaction and
clearing fees
|
$
|
718.4
|
|
$
|
678.8
|
|
$
|
392.7
|
|
$
|
330.9
|
|
$
|
255.4
|
|
$
|
270.1
|
|
$
|
35.3
|
|
$
|
41.1
|
|
$
|
20.5
|
|
$
|
24.2
|
|
$
|
14.4
|
|
$
|
12.5
|
|
$
|
0.1
|
|
$
|
—
|
Liquidity
payments
|
|
(381.4)
|
|
|
(395.7)
|
|
|
(157.7)
|
|
|
(162.2)
|
|
|
(214.4)
|
|
|
(226.3)
|
|
|
(8.8)
|
|
|
(7.2)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.5)
|
|
|
—
|
Routing and
clearing
|
|
(19.8)
|
|
|
(21.8)
|
|
|
(7.3)
|
|
|
(6.9)
|
|
|
(8.2)
|
|
|
(9.8)
|
|
|
(4.2)
|
|
|
(4.9)
|
|
|
—
|
|
|
—
|
|
|
(0.1)
|
|
|
(0.2)
|
|
|
—
|
|
|
—
|
Net transaction and
clearing fees
|
$
|
317.2
|
|
$
|
261.3
|
|
$
|
227.7
|
|
$
|
161.8
|
|
$
|
32.8
|
|
$
|
34.0
|
|
$
|
22.3
|
|
$
|
29.0
|
|
$
|
20.5
|
|
$
|
24.2
|
|
$
|
14.3
|
|
$
|
12.3
|
|
$
|
(0.4)
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Net Revenue by Revenue Caption –Three Months Ended December 31,
2022 and 2021
|
|
Cash and Spot
Markets
|
|
Data and Access
Solutions
|
|
Derivatives
Markets
|
|
Total
|
|
Three Months Ended
|
|
Three Months Ended
|
|
Three Months Ended
|
|
Three Months Ended
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
Transaction and
clearing fees
|
$
|
305.3
|
|
$
|
323.7
|
|
$
|
—
|
|
$
|
—
|
|
$
|
413.1
|
|
$
|
355.1
|
|
$
|
718.4
|
|
$
|
678.8
|
Access and capacity
fees
|
|
—
|
|
|
—
|
|
|
82.7
|
|
|
74.4
|
|
|
—
|
|
|
—
|
|
|
82.7
|
|
|
74.4
|
Market data
fees
|
|
18.2
|
|
|
19.7
|
|
|
45.0
|
|
|
36.0
|
|
|
8.5
|
|
|
7.8
|
|
|
71.7
|
|
|
63.5
|
Regulatory
fees
|
|
89.2
|
|
|
27.8
|
|
|
—
|
|
|
—
|
|
|
31.2
|
|
|
7.5
|
|
|
120.4
|
|
|
35.3
|
Other
revenue
|
|
10.3
|
|
|
10.4
|
|
|
0.4
|
|
|
3.4
|
|
|
0.8
|
|
|
0.6
|
|
|
11.5
|
|
|
14.4
|
Total
revenues
|
$
|
423.0
|
|
$
|
381.6
|
|
$
|
128.1
|
|
$
|
113.8
|
|
$
|
453.6
|
|
$
|
371.0
|
|
$
|
1,004.7
|
|
$
|
866.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidity
payments
|
$
|
223.1
|
|
$
|
233.3
|
|
$
|
—
|
|
$
|
—
|
|
$
|
158.3
|
|
$
|
162.4
|
|
$
|
381.4
|
|
$
|
395.7
|
Routing and clearing
fees
|
|
12.5
|
|
|
14.9
|
|
|
—
|
|
|
—
|
|
|
7.3
|
|
|
6.9
|
|
|
19.8
|
|
|
21.8
|
Section 31
fees
|
|
86.9
|
|
|
27.0
|
|
|
—
|
|
|
—
|
|
|
22.2
|
|
|
4.0
|
|
|
109.1
|
|
|
31.0
|
Royalty fees and other
cost of revenues
|
|
3.4
|
|
|
3.7
|
|
|
2.3
|
|
|
2.3
|
|
|
31.6
|
|
|
21.4
|
|
|
37.3
|
|
|
27.4
|
Total cost of
revenues
|
$
|
325.9
|
|
$
|
278.9
|
|
$
|
2.3
|
|
$
|
2.3
|
|
$
|
219.4
|
|
$
|
194.7
|
|
$
|
547.6
|
|
$
|
475.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues less cost
of revenues (net
revenue)
|
$
|
97.1
|
|
$
|
102.7
|
|
$
|
125.8
|
|
$
|
111.5
|
|
$
|
234.2
|
|
$
|
176.3
|
|
$
|
457.1
|
|
$
|
390.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition revenue
less cost of
revenues (inorganic net revenue)
|
|
(1.8)
|
|
|
—
|
|
|
(3.3)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5.1)
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Organic net
revenue
|
$
|
95.3
|
|
$
|
102.7
|
|
$
|
122.5
|
|
$
|
111.5
|
|
$
|
234.2
|
|
$
|
176.3
|
|
$
|
452.0
|
|
$
|
390.5
|
|
|
|
|
|
|
|
|
Table
9
|
|
|
|
|
|
|
|
Reconciliation of
GAAP Effective Tax Rate to Effective Tax Rate Excluding Goodwill
Impairment and Section 199 Matters - Three Months and Twelve Months
Ended December 31, 2022
|
|
|
|
|
|
|
|
|
|
|
Three months
ended,
|
|
|
Twelve Months
Ended
|
|
|
|
|
December 31,
2022
|
|
|
December 31,
2022
|
|
|
GAAP effective tax
rate
|
|
32.3
|
%
|
|
45.7
|
%
|
|
Tax effect of goodwill
impairment
|
|
—
|
%
|
|
(8.5)
|
%
|
|
Tax effect of Section
199 related matters
|
|
—
|
%
|
|
(5.5)
|
%
|
|
Effective tax rate
excluding goodwill impairment and Section 199 matters
|
|
32.3
|
%
|
|
31.7
|
%
|
|
|
|
|
|
|
|
Table
10
|
|
|
|
|
|
Reconciliation of
GAAP Net Revenues to Net Revenues in Constant Currency - Three and
Twelve Months Ended December 31, 2022
|
|
|
|
|
|
|
|
|
Three months
ended,
|
|
|
Twelve months
ended,
|
|
|
December
31,
2022
|
|
|
December
31,
2022
|
Europe and Asia Pacific
net revenues
|
$
|
44.2
|
|
$
|
196.1
|
Constant currency
adjustment1
|
|
5.6
|
|
|
21.3
|
Europe and Asia Pacific
net revenue in constant currency
|
$
|
49.8
|
|
$
|
217.4
|
|
(1) We
define constant currency net revenues as total net revenues
excluding the effect of foreign exchange rate movements. Constant
currency impact in dollars is calculated by translating the current
period GAAP net revenues using the foreign currency exchange rates
that were in effect during the previous comparable period and
subtracting it by the current period GAAP net revenues.
|
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