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Monday May 20th, 2019 10:47PM

Intercontinental Exchange Reports Fourth Quarter 2018

By The Associated Press

ATLANTA & NEW YORK--(BUSINESS WIRE)--Feb 7, 2019--Intercontinental Exchange (NYSE: ICE), a leading operator of global exchanges and clearing houses and provider of data and listing services, today reported financial results for the fourth quarter and full year of 2018. For the quarter ended December 31, 2018, consolidated net income attributable to ICE was $611 million on $1.3 billion of consolidated revenues less transaction-based expenses. Fourth quarter GAAP diluted earnings per share (EPS) were $1.07. Adjusted net income attributable to ICE was $536 million in the fourth quarter and adjusted diluted EPS were $0.94, up 25% year-over-year.

For the full year of 2018 consolidated net income attributable to ICE was $2.0 billion on $5.0 billion of consolidated revenues less transaction-based expenses. Full year 2018 GAAP diluted EPS were $3.43. On an adjusted basis, net income attributable to ICE for the year was $2.1 billion and adjusted diluted EPS were $3.59, up 21% year-over-year.

Please refer to the reconciliation of non-GAAP financial measures included in this press release for more information on our adjusted operating expenses, adjusted operating income, adjusted operating margin, adjusted net income, adjusted diluted EPS, organic data revenue and free cash flow.

“ 2018 marked our 13th consecutive year of record revenues - a track record directly attributable to customer demand for our risk management solutions and the investments we've made to enhance our technology, expand our content and broaden our distribution,” said ICE Chairman & Chief Executive Officer, Jeffrey C. Sprecher. “As we look to 2019, we remain focused on bringing mission-critical solutions to our customers and delivering value to our stockholders."

Scott A. Hill, ICE Chief Financial Officer, added: "In addition to record revenues, we generated record cash flows in 2018, enabling us to return nearly $1.8 billion in capital to stockholders, more than any year in our history. As we enter 2019, we remain committed to prudent capital management and a disciplined approach to investment to support continued growth and to enhance long-term stockholder value."

Fourth quarter consolidated net revenues were $1.3 billion, up 14% year-over-year. Data and listings revenues in the fourth quarter were $651 million and trading and clearing net revenues were $657 million, up 4% and 27% year-over-year, respectively. Consolidated operating expenses were $632 million for the fourth quarter of 2018. On an adjusted basis, consolidated operating expenses were $553 million. Consolidated operating income for the fourth quarter was $676 million and the operating margin was 52%. On an adjusted basis, consolidated operating income for the fourth quarter was $755 million and the adjusted operating margin was 58%.

Full year 2018 consolidated net revenues were $5.0 billion, up 7% year-over-year. Full year 2018 data and listings revenues were $2.6 billion and trading and clearing net revenues were $2.4 billion, up 2% and 14% year-over-year, respectively. Consolidated operating expenses were $2.4 billion for 2018. On an adjusted basis, consolidated operating expenses were $2.1 billion. Consolidated operating income for the year was $2.6 billion and the operating margin was 52%. On an adjusted basis, consolidated operating income for the year was $2.9 billion and the adjusted operating margin was 58%.

Data and Listings Segment Results

Fourth quarter data and listings revenues were $651 million, including data revenues of $539 million, up 3% year-over-year, negatively impacted by the divestiture of Trayport in the fourth quarter of 2017, and listings revenues of $112 million, up 8% year-over-year. On an organic, constant currency basis (1), segment revenues were up 6% with data revenues up 6% year-over-year and listings revenues up 8% year-over-year. Data and listings operating expenses were $376 million and on an adjusted basis, were $321 million in the fourth quarter. Segment operating income for the fourth quarter was $275 million and the operating margin was 42%. On an adjusted basis, operating income was $330 million and the adjusted operating margin was 51%.

Full year 2018 data and listings revenues were $2.6 billion, including data revenues of $2.1 billion, up 1% year-over-year, negatively impacted by the divestiture of Trayport in the fourth quarter of 2017, and listings revenues of $444 million, up 4% year-over-year, negatively impacted by the sale of NYSE Governance Services in the second quarter of 2017. On an organic, constant currency basis (1), segment revenues were up 5% with data revenues up 5% year-over-year and listings revenues up 6% year-over-year. Data and listings operating expenses were $1.5 billion and on an adjusted basis, were $1.2 billion for the year. Segment operating income for the full year was $1.1 billion and the operating margin was 42%. On an adjusted basis, operating income was $1.3 billion and the adjusted operating margin was 51%.

Trading and Clearing Segment Results

Fourth quarter trading and clearing net revenues were $657 million, up 27% from one year ago. Trading and clearing operating expenses were $256 million and adjusted operating expenses were $232 million in the fourth quarter. Segment operating income for the fourth quarter was $401 million and the operating margin was 61%. On an adjusted basis, operating income was $425 million and the adjusted operating margin was 65%.

Full year 2018 trading and clearing net revenues were $2.4 billion, up 14% from one year ago. Trading and clearing operating expenses were $911 million and adjusted operating expenses were $824 million in 2018. Segment operating income for the year was $1.5 billion and the operating margin was 62%. On an adjusted basis, operating income was $1.6 billion and the adjusted operating margin was 66%.

Other Matters

Earnings Conference Call Information

ICE will hold a conference call today, February 7, at 8:30 a.m. ET to review its fourth quarter 2018 financial results. A live audio webcast of the earnings call will be available on the company's website at www.theice.com in the investor relations section. Participants may also listen via telephone by dialing 888-317-6003 from the United States, 866-284-3684 from Canada or 412-317-6061 from outside of the United States and Canada. Telephone participants are required to provide the participant entry number 8241674 and are recommended to call 10 minutes prior to the start of the call. The call will be archived on the company's website for replay.

The conference call for the first quarter 2019 earnings has been scheduled for May 2, 2019 at 8:30 a.m. ET. Please refer to the Investor Relations website at www.ir.theice.com for additional information.

Historical futures, options and cash ADV, rate per contract, open interest data and CDS cleared information can be found at: http://ir.theice.com/investors-and-media/supplemental-volume-info/default.aspx

Non-GAAP Financial Measures and Reconciliation

We use non-GAAP measures internally to evaluate our performance and in making financial and operational decisions. When viewed in conjunction with our GAAP results and the accompanying reconciliation, we believe that our presentation of these measures provides investors with greater transparency and a greater understanding of factors affecting our financial condition and results of operations than GAAP measures alone. In addition, we believe the presentation of these measures is useful to investors for period-to-period comparison of results because the items described below as adjustments to GAAP are not reflective of our core business performance. These financial measures are not in accordance with, or an alternative to, GAAP financial measures and may be different from non-GAAP measures used by other companies. We use these adjusted results because we believe they more clearly highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures, since these measures eliminate from our results specific financial items that have less bearing on our core operating performance. We strongly recommend that investors review the GAAP financial measures and additional non-GAAP information included in our Annual Report on Form 10-K, including our consolidated financial statements and the notes thereto.

Adjusted operating expenses, adjusted operating income, adjusted operating margin, adjusted net income attributable to ICE common stockholders, adjusted diluted earnings per share, organic data revenue and free cash flow for the periods presented below are calculated by adding or subtracting the adjustments described below, which are not reflective of our cash operations and core business performance, and their related income tax effect and other tax adjustments (in millions, except for per share amounts):

About Intercontinental Exchange

Intercontinental Exchange (NYSE: ICE) is a Fortune 500 company formed in the year 2000 to modernize markets. ICE serves customers by operating the exchanges, clearing houses and information services they rely upon to invest, trade and manage risk across global financial and commodity markets. A leader in market data, ICE Data Services serves the information and connectivity needs across virtually all asset classes. As the parent company of the New York Stock Exchange, the company raises more capital than any other exchange in the world, driving economic growth and transforming markets.

Trademarks of ICE and/or its affiliates include Intercontinental Exchange, ICE, ICE block design, NYSE and New York Stock Exchange. Information regarding additional trademarks and intellectual property rights of Intercontinental Exchange, Inc. and/or its affiliates is located at http://www.intercontinentalexchange.com/terms-of-use. Key Information Documents for certain products covered by the EU Packaged Retail and Insurance-based Investment Products Regulation can be accessed on the relevant exchange website under the heading “Key Information Documents (KIDS).”

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 - Statements in this press release regarding ICE's business that are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see ICE's Securities and Exchange Commission (SEC) filings, including, but not limited to, the risk factors in Intercontinental Exchange, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2018, as filed with the SEC on February 7, 2019. We caution you not to place undue reliance on these forward looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of an unanticipated event. New factors emerge from time to time, and it is not possible for management to predict all factors that may affect our business and prospects. Further, management cannot assess the impact of each factor on the 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.

SOURCE: Intercontinental Exchange

ICE-CORP

View source version on businesswire.com:https://www.businesswire.com/news/home/20190207005272/en/

CONTACT: ICE Investor Relations Contact:

Warren Gardiner

+1 770 835 0114

warren.gardiner@theice.com

investors@theice.comICE Media Contact:

Damon Leavell

+1 212 323 8587

damon.leavell@theice.com

media@theice.com

KEYWORD: UNITED STATES NORTH AMERICA GEORGIA NEW YORK

INDUSTRY KEYWORD: PROFESSIONAL SERVICES BANKING CONSULTING FINANCE

SOURCE: Intercontinental Exchange

Copyright Business Wire 2019.

PUB: 02/07/2019 07:30 AM/DISC: 02/07/2019 07:31 AM

http://www.businesswire.com/news/home/20190207005272/en

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