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Mar 31, 2020
Cboe Q1 2020 Earnings Report
Cboe's first quarter was defined by market uncertainty due to COVID-19, leading to record net revenues and earnings.
Key Takeaways
Cboe Global Markets reported record results for the first quarter of 2020, driven by increased trading activity across asset classes and expense discipline. Net revenue reached a record $358.3 million, up 28 percent, and adjusted diluted EPS was $1.65, up 48 percent. The company returned $160 million to shareholders through share repurchases and dividends.
Diluted EPS for the quarter was $1.42, up 67 percent.
Record adjusted diluted EPS for the quarter was $1.65, up 48 percent.
Record net revenue for the quarter was $358.3 million, up 28 percent.
Set new quarterly highs for total options and FX volume.
Revenue by Segment
Forward Guidance
Cboe updated or reaffirmed its guidance for the 2020 fiscal year. This guidance does not take into account the company’s planned acquisition of EuroCCP, which is subject to satisfaction or waiver of conditions precedent, and its investment in launching pan-European derivatives trading and clearing, which is subject to regulatory approval. The company plans to update its guidance for 2020 after the acquisition closes, which is currently expected in the second quarter of this year.
Positive Outlook
- Adjusted operating expenses are now expected to be in the range of $419 to $427 million, down $16 million from the previous guidance of $435 to $443 million, primarily reflecting near-term cost reductions due to the COVID-19 pandemic.
- The guidance excludes the expected amortization of acquired intangible assets of $120 million, which the company plans to include in its non-GAAP reconciliation.
- Reaffirmed that depreciation and amortization expense, which is included in adjusted operating expenses above, is expected to be in the range of $34 to $38 million, excluding the expected amortization of acquired intangible assets of $120 million.
- Reaffirmed that the effective tax rate on adjusted earnings for the full year is expected to be in the range of 26.5 to 28.5 percent.
- Reaffirmed that capital expenditures are expected to be in the range of $65 to $70 million, which includes expenditures associated with the company’s Chicago headquarters relocation occurring later this year and its trading floor relocation planned for 2021.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
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Avg. Return Before/After Earnings
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