|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
|
|
Delaware
|
20-5446972
|
||
(State or Other Jurisdiction of
|
(I.R.S. Employer
|
||
Incorporation or Organization)
|
Identification No.)
|
400 South LaSalle Street Chicago, Illinois
|
60605
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
Large accelerated filer
|
☒
|
Accelerated filer
|
☐
|
|
|
|
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
Class
|
|
July 31, 2017
|
Common Stock, par value $0.01
|
|
112,777,346 shares
|
|
|
Page
|
PART I. FINANCIAL INFORMATION
|
|
|
Item 1.
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
|
|
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PART II. OTHER INFORMATION
|
|
|
Item 1.
|
||
Item 1A.
|
||
Item 2.
|
||
Item 3.
|
||
Item 4.
|
||
Item 5.
|
||
Item 6.
|
||
|
|
|
SIGNATURES
|
||
|
•
|
"CBOE Holdings," "we," "us," "our" or "the Company" refers to CBOE Holdings, Inc. and its subsidiaries.
|
•
|
"Bats Exchanges" refers to BZX, BYX, EDGX and EDGA.
|
•
|
“Bats Global Markets” and “Bats” refer to our wholly-owned subsidiary Bats Global Markets, Inc., now known as CBOE V, LLC, and its subsidiaries.
|
•
|
“Bats Hotspot” and “Hotspot” refer to our foreign currency exchange. Hotspot operates in the United States and the United Kingdom.
|
•
|
“Bats Trading” and “Trading” refer to our broker-dealer entity, Bats Trading, Inc., a wholly-owned subsidiary of CBOE Holdings, Inc., operated in the United States.
|
•
|
“BTL” refers to Bats Trading Limited, a wholly-owned subsidiary of CBOE Holdings, Inc., the U.K. operator of our Multilateral Trading Facility ("MTF"), and our Regulated Market ("RM"), under its Recognized Investment Exchange ("RIE") status, collectively known as “Bats Europe”.
|
•
|
“BYX” refers to Bats BYX Exchange, Inc., a wholly-owned subsidiary of CBOE Holdings, Inc.
|
•
|
“BZX” refers to Bats BZX Exchange, Inc., a wholly-owned subsidiary of CBOE Holdings, Inc.
|
•
|
"C2" refers to C2 Options Exchange, Incorporated, a wholly-owned subsidiary of CBOE Holdings, Inc.
|
•
|
"CBOE" refers to Chicago Board Options Exchange, Incorporated, a wholly-owned subsidiary of CBOE Holdings, Inc.
|
•
|
"CFE" refers to CBOE Futures Exchange, LLC, a wholly-owned subsidiary of CBOE Holdings, Inc.
|
•
|
"CFTC" refers to the U.S. Commodity Futures Trading Commission.
|
•
|
“Chi-X Europe” refers to our broker-dealer operated in the United Kingdom.
|
•
|
“EDGA” refers to Bats EDGA Exchange, Inc., a wholly-owned subsidiary of CBOE Holdings, Inc.
|
•
|
“EDGX” refers to Bats EDGX Exchange, Inc., a wholly-owned subsidiary of CBOE Holdings, Inc.
|
•
|
"Exchanges" refers to CBOE, C2, BZX, BYX, EDGX, and EDGA.
|
•
|
"FASB" refers to the Financial Accounting Standards Board.
|
•
|
"FCA" refers to the U.K. Financial Conduct Authority.
|
•
|
"GAAP" refers to Generally Accepted Accounting Principles in the United States.
|
•
|
"Merger" refers to our acquisition of Bats Global Markets, completed on February 28, 2017.
|
•
|
"OCC" refers to The Options Clearing Corporation, which is the issuer and registered clearing agency for all U.S. exchange-listed options and is the designated clearing organization for futures traded on CFE.
|
•
|
"SEC" refers to the U.S. Securities and Exchange Commission.
|
•
|
"SPX" refers to our S&P 500 Index exchange-traded options products.
|
•
|
"VIX" refers to the CBOE Volatility Index methodology.
|
•
|
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 volumes, market data fees or a shift in the mix of products traded on our exchanges;
|
•
|
legislative or regulatory changes;
|
•
|
increasing competition by foreign and domestic entities;
|
•
|
our dependence on and exposure to risk from third parties;
|
•
|
our index providers' ability to maintain the quality and integrity of their indexes and to perform under our agreements;
|
•
|
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 attract and retain skilled management and other personnel, including those experienced with post-acquisition integration;
|
•
|
our ability to accommodate trading volume and transaction traffic, including significant increases, without failure or degradation of performance of our systems;
|
•
|
our ability to protect our systems and communication networks from security risks, including cyber-attacks and unauthorized disclosure of confidential information;
|
•
|
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;
|
•
|
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;
|
•
|
unanticipated difficulties or expenditures relating to the Merger, including, without limitation, difficulties that result in the failure to realize expected synergies, accretion, efficiencies and cost savings from the Merger within the expected time period (if at all), whether in connection with integration, migrating trading platforms, broadening distribution of product offerings or otherwise;
|
•
|
restrictions imposed by our debt obligations;
|
•
|
our ability to maintain an investment grade credit rating;
|
•
|
potential difficulties in our migration of trading platforms and our ability to retain employees as a result of the Merger; and
|
•
|
the accuracy of our estimates and expectations.
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
Assets
|
|
|
|
||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
148.6
|
|
|
$
|
97.3
|
|
Financial investments
|
110.4
|
|
|
—
|
|
||
Accounts receivables, net
|
231.3
|
|
|
76.7
|
|
||
Income taxes receivable
|
10.7
|
|
|
53.7
|
|
||
Other current assets
|
18.7
|
|
|
7.4
|
|
||
Total Current Assets
|
519.7
|
|
|
235.1
|
|
||
Investments
|
82.0
|
|
|
72.9
|
|
||
Land
|
4.9
|
|
|
4.9
|
|
||
Property and equipment, net
|
75.6
|
|
|
55.9
|
|
||
Goodwill
|
2,686.4
|
|
|
26.5
|
|
||
Intangible assets, net
|
1,970.4
|
|
|
8.7
|
|
||
Other assets, net
|
56.6
|
|
|
72.7
|
|
||
Total Assets
|
$
|
5,395.6
|
|
|
$
|
476.7
|
|
Liabilities, Redeemable Noncontrolling Interests and Stockholders’ Equity
|
|
|
|
||||
Current Liabilities:
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
151.0
|
|
|
$
|
82.4
|
|
Section 31 fees payable
|
150.9
|
|
|
4.4
|
|
||
Deferred revenue
|
14.3
|
|
|
3.1
|
|
||
Income taxes payable
|
3.9
|
|
|
—
|
|
||
Contingent consideration liability
|
56.2
|
|
|
—
|
|
||
Total Current Liabilities
|
376.3
|
|
|
89.9
|
|
||
|
|
|
|
||||
Long-term debt
|
1,411.3
|
|
|
—
|
|
||
Income tax liability
|
68.6
|
|
|
52.1
|
|
||
Deferred income taxes
|
703.4
|
|
|
—
|
|
||
Other non-current liabilities
|
6.7
|
|
|
4.2
|
|
||
Commitments and Contingencies
|
|
|
|
||||
|
|
|
|
||||
Redeemable Noncontrolling Interest
|
12.6
|
|
|
12.6
|
|
||
|
|
|
|
||||
Stockholders’ Equity:
|
|
|
|
||||
Preferred stock, $0.01 par value: 20,000,000 shares authorized, no shares issued and outstanding at June 30, 2017 and December 31, 2016
|
—
|
|
|
—
|
|
||
Common stock, $0.01 par value: 325,000,000 shares authorized, 124,632,833 and 112,777,346 shares issued and outstanding, respectively at June 30, 2017 and 92,950,065 and 81,285,307 shares issued and outstanding, respectively at December 31, 2016
|
1.2
|
|
|
0.9
|
|
||
Treasury stock, at cost: 11,855,487 shares at June 30, 2017 and 11,664,758 shares at December 31, 2016
|
(548.2
|
)
|
|
(532.2
|
)
|
||
Additional paid-in capital
|
2,596.8
|
|
|
139.2
|
|
||
Retained earnings
|
737.3
|
|
|
710.8
|
|
||
Accumulated other comprehensive income (loss), net
|
29.6
|
|
|
(0.8
|
)
|
||
Total Stockholders’ Equity
|
2,816.7
|
|
|
317.9
|
|
||
Total Liabilities, Redeemable Noncontrolling Interest and Stockholders’ Equity
|
$
|
5,395.6
|
|
|
$
|
476.7
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Transaction fees
|
$
|
453.9
|
|
|
$
|
127.6
|
|
|
$
|
710.3
|
|
|
$
|
253.8
|
|
Access fees
|
29.7
|
|
|
13.2
|
|
|
47.5
|
|
|
26.4
|
|
||||
Exchange services and other fees
|
19.9
|
|
|
11.4
|
|
|
35.3
|
|
|
22.8
|
|
||||
Market data fees
|
48.0
|
|
|
8.2
|
|
|
70.5
|
|
|
16.2
|
|
||||
Regulatory fees
|
83.3
|
|
|
9.2
|
|
|
121.6
|
|
|
18.3
|
|
||||
Other revenue
|
6.0
|
|
|
3.5
|
|
|
11.8
|
|
|
6.1
|
|
||||
Total Revenues
|
640.8
|
|
|
173.1
|
|
|
997.0
|
|
|
343.6
|
|
||||
Cost of Revenues:
|
|
|
|
|
|
|
|
||||||||
Liquidity payments
|
266.5
|
|
|
7.1
|
|
|
371.8
|
|
|
13.7
|
|
||||
Routing and clearing
|
12.2
|
|
|
2.6
|
|
|
18.5
|
|
|
4.3
|
|
||||
Section 31 fees
|
74.6
|
|
|
—
|
|
|
104.6
|
|
|
—
|
|
||||
Royalty fees
|
20.6
|
|
|
19.3
|
|
|
41.8
|
|
|
38.4
|
|
||||
Total Cost of Revenues
|
373.9
|
|
|
29.0
|
|
|
536.7
|
|
|
56.4
|
|
||||
Revenues less Cost of Revenues
|
266.9
|
|
|
144.1
|
|
|
460.3
|
|
|
287.2
|
|
||||
Operating Expenses:
|
|
|
|
|
|
|
|
||||||||
Compensation and benefits
|
50.0
|
|
|
28.5
|
|
|
97.8
|
|
|
55.6
|
|
||||
Depreciation and amortization
|
55.8
|
|
|
12.3
|
|
|
80.9
|
|
|
24.2
|
|
||||
Technology support services
|
12.0
|
|
|
5.7
|
|
|
19.5
|
|
|
11.4
|
|
||||
Professional fees and outside services
|
16.9
|
|
|
14.7
|
|
|
31.3
|
|
|
28.3
|
|
||||
Travel and promotional expenses
|
4.2
|
|
|
2.5
|
|
|
7.5
|
|
|
5.0
|
|
||||
Facilities costs
|
2.7
|
|
|
1.4
|
|
|
4.8
|
|
|
2.9
|
|
||||
Acquisition-related costs
|
4.7
|
|
|
—
|
|
|
69.9
|
|
|
—
|
|
||||
Change in contingent consideration
|
0.5
|
|
|
—
|
|
|
0.7
|
|
|
—
|
|
||||
Other expenses
|
2.3
|
|
|
1.0
|
|
|
4.0
|
|
|
2.3
|
|
||||
Total Operating Expenses
|
149.1
|
|
|
66.1
|
|
|
316.4
|
|
|
129.7
|
|
||||
Operating Income
|
117.8
|
|
|
78.0
|
|
|
143.9
|
|
|
157.5
|
|
||||
Non-operating (Expenses) Income:
|
|
|
|
|
|
|
|
||||||||
Interest expense, net
|
(12.5
|
)
|
|
—
|
|
|
(20.4
|
)
|
|
—
|
|
||||
Other income
|
0.8
|
|
|
5.8
|
|
|
0.9
|
|
|
6.8
|
|
||||
Income Before Income Tax Provision
|
106.1
|
|
|
83.8
|
|
|
124.4
|
|
|
164.3
|
|
||||
Income tax provision
|
38.1
|
|
|
32.9
|
|
|
41.2
|
|
|
64.2
|
|
||||
Net income
|
68.0
|
|
|
50.9
|
|
|
83.2
|
|
|
100.1
|
|
||||
Net loss attributable to redeemable noncontrolling interest
|
0.3
|
|
|
0.3
|
|
|
0.6
|
|
|
0.5
|
|
||||
Net Income Excluding Noncontrolling Interest
|
68.3
|
|
|
51.2
|
|
|
83.8
|
|
|
100.6
|
|
||||
Change in redemption value of noncontrolling interest
|
(0.3
|
)
|
|
(0.3
|
)
|
|
(0.6
|
)
|
|
(0.5
|
)
|
||||
Net income allocated to participating securities
|
(0.7
|
)
|
|
(0.2
|
)
|
|
(0.8
|
)
|
|
(0.4
|
)
|
||||
Net Income Allocated to Common Stockholders
|
$
|
67.3
|
|
|
$
|
50.7
|
|
|
$
|
82.4
|
|
|
$
|
99.7
|
|
Net Income Per Share Allocated to Common Stockholders:
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share
|
$
|
0.60
|
|
|
$
|
0.62
|
|
|
$
|
0.81
|
|
|
$
|
1.22
|
|
Diluted earnings per share
|
0.60
|
|
|
0.62
|
|
|
0.81
|
|
|
1.22
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic weighted average shares outstanding
|
112.1
|
|
|
81.3
|
|
|
102.1
|
|
|
81.6
|
|
||||
Diluted weighted average shares outstanding
|
112.5
|
|
|
81.3
|
|
|
102.3
|
|
|
81.6
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|||||||||||
|
2017
|
|
2016
|
|
2017
|
2016
|
||||||||
Net Income
|
$
|
68.0
|
|
|
$
|
50.9
|
|
|
$
|
83.2
|
|
$
|
100.1
|
|
Foreign currency translation adjustments
|
27.1
|
|
|
—
|
|
|
30.2
|
|
—
|
|
||||
Unrealized holding gains on available-for-sale investments
|
0.3
|
|
|
—
|
|
|
0.2
|
|
—
|
|
||||
Comprehensive Income
|
95.4
|
|
|
50.9
|
|
|
113.6
|
|
100.1
|
|
||||
Comprehensive loss attributable to noncontrolling interest
|
0.3
|
|
|
0.3
|
|
|
0.6
|
|
0.5
|
|
||||
Comprehensive Income Excluding Noncontrolling Interest
|
95.7
|
|
|
51.2
|
|
|
114.2
|
|
100.6
|
|
||||
Change in redemption value of noncontrolling interest
|
(0.3
|
)
|
|
(0.3
|
)
|
|
(0.6
|
)
|
(0.5
|
)
|
||||
Comprehensive income allocated to participating securities
|
(0.9
|
)
|
|
(0.2
|
)
|
|
(1.0
|
)
|
(0.4
|
)
|
||||
Comprehensive Income Allocated to Common Stockholders
|
$
|
94.5
|
|
|
$
|
50.7
|
|
|
$
|
112.6
|
|
$
|
99.7
|
|
|
Preferred Stock
|
|
Common Stock
|
|
Treasury Stock
|
|
Additional Paid-In Capital
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive (Loss) Income, net
|
|
Total Stockholders’ Equity
|
|
Redeemable Noncontrolling Interests
|
|||||||||||||||||
Balance at December 31, 2016
|
$
|
—
|
|
|
$
|
0.9
|
|
|
$
|
(532.2
|
)
|
|
$
|
139.2
|
|
|
$
|
710.8
|
|
|
$
|
(0.8
|
)
|
|
$
|
317.9
|
|
|
$
|
12.6
|
|
|
Issuance of stock for acquisition of Bats Global Markets, Inc.
|
—
|
|
|
0.3
|
|
|
—
|
|
|
2,424.4
|
|
|
—
|
|
|
—
|
|
|
2,424.7
|
|
|
—
|
|
|||||||||
Repurchase of restricted stock from employees
|
—
|
|
|
—
|
|
|
(16.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16.0
|
)
|
|
—
|
|
|||||||||
Common stock issued from employee stock plans
|
—
|
|
|
—
|
|
|
—
|
|
|
3.1
|
|
|
—
|
|
|
—
|
|
|
3.1
|
|
|
—
|
|
|||||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
30.1
|
|
|
—
|
|
|
—
|
|
|
30.1
|
|
|
—
|
|
|||||||||
Net income excluding noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
83.8
|
|
|
—
|
|
|
83.8
|
|
|
—
|
|
|||||||||
Cash dividends on common stock of $0.50 per share
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(56.7
|
)
|
|
—
|
|
|
(56.7
|
)
|
|
—
|
|
|||||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30.4
|
|
|
30.4
|
|
|
—
|
|
|||||||||
Net loss attributable to redeemable noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
|||||||||
Redemption value adjustment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
|
—
|
|
|
(0.6
|
)
|
|
0.6
|
|
|||||||||
Balance at June 30, 2017
|
$
|
—
|
|
|
$
|
1.2
|
|
|
$
|
(548.2
|
)
|
—
|
|
$
|
2,596.8
|
|
|
$
|
737.3
|
|
|
$
|
29.6
|
|
|
$
|
2,816.7
|
|
|
$
|
12.6
|
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net income
|
$
|
83.2
|
|
|
$
|
100.1
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
80.9
|
|
|
24.2
|
|
||
Amortization of debt issuance cost
|
1.0
|
|
|
—
|
|
||
Change in fair value of contingent consideration
|
0.7
|
|
|
—
|
|
||
Realized gain on available-for-sale securities
|
(0.2
|
)
|
|
—
|
|
||
Provision for deferred income taxes
|
(15.0
|
)
|
|
(0.4
|
)
|
||
Stock-based compensation expense
|
30.1
|
|
|
7.1
|
|
||
Impairment of data processing software
|
14.9
|
|
|
—
|
|
||
Equity in investments
|
(0.1
|
)
|
|
(0.5
|
)
|
||
Excess tax benefit from stock-based compensation
|
5.7
|
|
|
—
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
(33.9
|
)
|
|
(10.0
|
)
|
||
Income taxes receivable
|
48.3
|
|
|
(4.6
|
)
|
||
Other current assets
|
(8.4
|
)
|
|
(5.3
|
)
|
||
Accounts payable and accrued liabilities
|
9.1
|
|
|
(3.2
|
)
|
||
Section 31 fees payable
|
2.9
|
|
|
—
|
|
||
Deferred revenue
|
6.7
|
|
|
6.6
|
|
||
Income taxes payable
|
(50.1
|
)
|
|
(1.6
|
)
|
||
Income tax liability
|
(3.9
|
)
|
|
2.5
|
|
||
Other liabilities
|
0.2
|
|
|
—
|
|
||
Net Cash Flows provided by Operating Activities
|
172.1
|
|
|
114.9
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Acquisitions, net of cash acquired
|
(1,405.4
|
)
|
|
(14.3
|
)
|
||
Purchases of available-for-sale financial investments
|
(89.2
|
)
|
|
—
|
|
||
Proceeds from maturities of available-for-sale financial investments
|
45.0
|
|
|
—
|
|
||
Investments
|
1.4
|
|
|
(24.2
|
)
|
||
Purchases of property and equipment
|
(19.2
|
)
|
|
(25.4
|
)
|
||
Net Cash Flows used in Investing Activities
|
(1,467.4
|
)
|
|
(63.9
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Proceeds from long-term debt
|
1,944.2
|
|
|
—
|
|
||
Principal payments of long term debt
|
(525.0
|
)
|
|
—
|
|
||
Debt issuance costs
|
(1.3
|
)
|
|
—
|
|
||
Dividends paid
|
(56.7
|
)
|
|
(37.7
|
)
|
||
Purchase of unrestricted stock from employees
|
(16.0
|
)
|
|
—
|
|
||
Proceeds from exercise of stock-based compensation
|
1.3
|
|
|
—
|
|
||
Excess tax benefit from stock-based compensation
|
—
|
|
|
1.2
|
|
||
Proceeds from employee stock purchase plan
|
—
|
|
|
(4.1
|
)
|
||
Purchase of common stock under announced program
|
—
|
|
|
(60.5
|
)
|
||
Net Cash provided by (used in) Financing Activities
|
1,346.5
|
|
|
(101.1
|
)
|
||
Effect of Foreign Currency Exchange Rate Changes on Cash and Cash equivalents
|
0.1
|
|
|
—
|
|
||
Increase (Decrease) in Cash and Cash Equivalents
|
51.3
|
|
|
(50.1
|
)
|
||
Cash and Cash Equivalents:
|
|
|
|
||||
Beginning of Period
|
97.3
|
|
|
102.3
|
|
||
End of Period
|
$
|
148.6
|
|
|
$
|
52.2
|
|
Supplemental disclosure of noncash transactions:
|
|
|
|
||||
Forfeiture of common stock for payment of exercise of stock options
|
$
|
1.7
|
|
|
$
|
—
|
|
Supplemental disclosure of noncash investing activities:
|
|
|
|
||||
Accounts receivable acquired
|
$
|
117.8
|
|
|
$
|
—
|
|
Financial investments
|
66.0
|
|
|
—
|
|
||
Property and equipment acquired
|
21.8
|
|
|
—
|
|
||
Goodwill acquired
|
2,649.3
|
|
|
—
|
|
||
Intangible assets acquired
|
2,000.0
|
|
|
—
|
|
||
Other assets acquired
|
32.8
|
|
|
—
|
|
||
Accounts payable and accrued expenses acquired
|
(60.1
|
)
|
|
—
|
|
||
Section 31 fees payable acquired
|
(143.6
|
)
|
|
—
|
|
||
Deferred tax liability acquired
|
(718.5
|
)
|
|
—
|
|
||
Other liabilities assumed
|
(135.4
|
)
|
|
—
|
|
||
Issuance of common stock related to acquisition
|
(2,424.7
|
)
|
|
—
|
|
•
|
Transaction fees
- Transaction fees represent fees charged by the Company for the performance obligation of executing a trade on its markets. These fees can be variable based on trade volume tiered discounts, however, as all tiered discounts are calculated monthly, the actual discount is recorded on a monthly basis. Transaction fees, as well as any tiered volume discounts, are calculated and billed monthly in accordance with the Company’s published fee schedules. Transaction fees are recognized across all segments. The Company also pays liquidity payments to customers based on its published fee schedules. The Company uses these payments to improve the liquidity on its markets and therefore recognizes those payments as a cost of revenue.
|
•
|
Access fees -
Access fees represent fees assessed for the opportunity to trade, including fees for trading-related functionality across all segments. These fees are billed monthly in accordance with the Company’s published fee schedules and recognized on a monthly basis when the performance obligation is met. There is no remaining performance obligation after revenue is recognized.
|
•
|
Exchange services and other fees -
To facilitate trading, the Company offers technology services, terminal and other equipment rights, maintenance services, trading floor space and telecommunications services. Trading floor and equipment rights are generally on a month-to-month basis. Facilities, systems services and other fees are generally monthly fee-based, although certain services are influenced by trading volume or other defined metrics, while others are based solely on demand. All fees associated with the trading floor are recognized in the Options segment.
|
•
|
Market data fees -
Market data fees represent the fees received by the Company from the U.S. tape plans and fees charged to customers for proprietary market data. Fees from the U.S. tape plans are collected monthly based on published fee schedules and distributed quarterly to the U.S. exchanges based on a known formula. A contract for proprietary market data is entered into and charged on a monthly basis in accordance with the Company’s published fee schedules as the service is provided. Both types of market data are satisfied over time, and revenue is recognized on a monthly basis as the customer receives and consumes the benefit as the Company provides the data. U.S. tape plan market data is recognized in the U.S. Equities and Options segments. Proprietary market data fees are recognized across all segments.
|
•
|
Regulatory fees
-
There are two types of regulatory fees that the Company recognizes. The first type represents fees collected by the Company to cover the Section 31 fees charged to the Exchanges by the SEC. The fees charged to customers are based on the fee set by the SEC per notional value of the transaction executed on the Company’s U.S. securities markets. These fees are calculated and billed monthly and are recognized in the U.S. Equities and Options segments. As the Exchanges are responsible for the ultimate payment to the SEC, the exchanges are considered the principal in these transactions. Regulatory fees also includes the options regulatory fee (ORF) which supports the Company’s regulatory oversight function in the Options segment and other miscellaneous regulatory fees.
|
•
|
Other revenue -
Other revenue
primarily includes revenue from various licensing agreements, all fees related to the trade reporting facility operated in the European Equities segment, and revenue associated with advertisements through the Company’s website.
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
||||||||||||||
|
|
|
U.S.
|
|
|
|
European
|
|
Global
|
|
Items and
|
|
|
||||||||||||||
|
Options
|
|
Equities
|
|
Futures
|
|
Equities
|
|
FX
|
|
Eliminations
|
|
Total
|
||||||||||||||
Three months ended June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Transaction fees
|
$
|
181.2
|
|
|
$
|
208.3
|
|
|
$
|
34.0
|
|
|
$
|
20.8
|
|
|
$
|
9.6
|
|
|
$
|
—
|
|
|
$
|
453.9
|
|
Access fees
|
13.9
|
|
|
12.7
|
|
|
0.5
|
|
|
1.8
|
|
|
0.8
|
|
|
—
|
|
|
29.7
|
|
|||||||
Exchange services and other fees
|
10.1
|
|
|
5.9
|
|
|
2.2
|
|
|
1.2
|
|
|
0.5
|
|
|
—
|
|
|
19.9
|
|
|||||||
Market data fees
|
10.5
|
|
|
33.9
|
|
|
0.8
|
|
|
2.8
|
|
|
—
|
|
|
—
|
|
|
48.0
|
|
|||||||
Regulatory fees
|
14.7
|
|
|
68.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
83.3
|
|
|||||||
Other revenue
|
3.1
|
|
|
1.7
|
|
|
—
|
|
|
1.0
|
|
|
—
|
|
|
0.2
|
|
|
6.0
|
|
|||||||
|
$
|
233.5
|
|
|
$
|
331.1
|
|
|
$
|
37.5
|
|
|
$
|
27.6
|
|
|
$
|
10.9
|
|
|
$
|
0.2
|
|
|
$
|
640.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Timing of revenue recognition
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Services transferred at a point in time
|
$
|
199.0
|
|
|
$
|
278.6
|
|
|
$
|
34.0
|
|
|
$
|
21.8
|
|
|
$
|
9.6
|
|
|
$
|
0.2
|
|
|
$
|
543.2
|
|
Services transferred over time
|
34.5
|
|
|
52.5
|
|
|
3.5
|
|
|
5.8
|
|
|
1.3
|
|
|
—
|
|
|
97.6
|
|
|||||||
|
$
|
233.5
|
|
|
$
|
331.1
|
|
|
$
|
37.5
|
|
|
$
|
27.6
|
|
|
$
|
10.9
|
|
|
$
|
0.2
|
|
|
$
|
640.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Three months ended June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Transaction fees
|
$
|
99.8
|
|
|
$
|
—
|
|
|
$
|
27.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
127.6
|
|
Access fees
|
13.0
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13.2
|
|
|||||||
Exchange services and other fees
|
9.4
|
|
|
—
|
|
|
2.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11.4
|
|
|||||||
Market data fees
|
7.4
|
|
|
—
|
|
|
0.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.2
|
|
|||||||
Regulatory fees
|
9.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9.2
|
|
|||||||
Other revenue
|
2.9
|
|
|
—
|
|
|
0.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.5
|
|
|||||||
|
$
|
141.7
|
|
|
$
|
—
|
|
|
$
|
31.4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
173.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
||||||||||||||
|
|
|
|
U.S.
|
|
|
|
European
|
|
Global
|
|
Items and
|
|
|
||||||||||||||
|
|
Options
|
|
Equities
|
|
Futures
|
|
Equities
|
|
FX
|
|
Eliminations
|
|
Total
|
||||||||||||||
Six months ended June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Transaction fees
|
|
$
|
321.4
|
|
|
$
|
285.0
|
|
|
$
|
62.7
|
|
|
$
|
28.0
|
|
|
$
|
13.2
|
|
|
$
|
—
|
|
|
$
|
710.3
|
|
Access fees
|
|
26.2
|
|
|
16.9
|
|
|
1.0
|
|
|
2.4
|
|
|
1.0
|
|
|
—
|
|
|
47.5
|
|
|||||||
Exchange services and other fees
|
|
23.0
|
|
|
7.9
|
|
|
2.2
|
|
|
1.6
|
|
|
0.6
|
|
|
—
|
|
|
35.3
|
|
|||||||
Market data fees
|
|
20.9
|
|
|
45.0
|
|
|
0.8
|
|
|
3.7
|
|
|
0.1
|
|
|
—
|
|
|
70.5
|
|
|||||||
Regulatory fees
|
|
27.4
|
|
|
94.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
121.6
|
|
|||||||
Other revenue
|
|
7.3
|
|
|
2.3
|
|
|
0.7
|
|
|
1.2
|
|
|
—
|
|
|
0.3
|
|
|
11.8
|
|
|||||||
|
|
$
|
426.2
|
|
|
$
|
451.3
|
|
|
$
|
67.4
|
|
|
$
|
36.9
|
|
|
$
|
14.9
|
|
|
$
|
0.3
|
|
|
$
|
997.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Timing of revenue recognition
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Services transferred at a point in time
|
|
$
|
356.1
|
|
|
$
|
381.5
|
|
|
$
|
63.4
|
|
|
$
|
29.2
|
|
|
$
|
13.2
|
|
|
$
|
0.3
|
|
|
$
|
843.7
|
|
Services transferred over time
|
|
70.1
|
|
|
69.8
|
|
|
4.0
|
|
|
7.7
|
|
|
1.7
|
|
|
—
|
|
|
153.3
|
|
|||||||
|
|
$
|
426.2
|
|
|
$
|
451.3
|
|
|
$
|
67.4
|
|
|
$
|
36.9
|
|
|
$
|
14.9
|
|
|
$
|
0.3
|
|
|
$
|
997.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Six months ended June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Transaction fees
|
|
$
|
204.3
|
|
|
$
|
—
|
|
|
$
|
49.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
253.8
|
|
Access fees
|
|
26.0
|
|
|
—
|
|
|
0.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26.4
|
|
|||||||
Exchange services and other fees
|
|
18.9
|
|
|
—
|
|
|
3.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
22.8
|
|
|||||||
Market data fees
|
|
14.6
|
|
|
—
|
|
|
1.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16.2
|
|
|||||||
Regulatory fees
|
|
18.3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
18.3
|
|
|||||||
Other revenue
|
|
5.5
|
|
|
—
|
|
|
0.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6.1
|
|
|||||||
|
|
$
|
287.6
|
|
|
$
|
—
|
|
|
$
|
56.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
343.6
|
|
|
January 1, 2017
|
|
Cash
Additions
|
|
Revenue
Recognition
|
|
June 30, 2017
|
||||||||
Liquidity provider sliding scale (1)
|
$
|
—
|
|
|
$
|
12.0
|
|
|
$
|
(6.0
|
)
|
|
$
|
6.0
|
|
Other, net
|
3.1
|
|
|
11.0
|
|
|
(5.8
|
)
|
|
8.3
|
|
||||
Total deferred revenue
|
$
|
3.1
|
|
|
$
|
23.0
|
|
|
$
|
(11.8
|
)
|
|
$
|
14.3
|
|
Cash
|
|
$
|
955.5
|
|
Common stock issued
|
|
2,387.3
|
|
|
Equity awards issued
|
|
37.4
|
|
|
|
|
3,380.2
|
|
|
Debt extinguished
|
|
580.0
|
|
|
Total consideration paid
|
|
$
|
3,960.2
|
|
|
|
|
|
U.S.
|
|
European
|
|
|
|
|
||||||||
(amounts in millions)
|
|
Options
|
|
Equities
|
|
Equities
|
|
Global FX
|
|
Useful life
|
||||||||
Trading registrations and licenses
|
|
$
|
95.5
|
|
|
$
|
572.7
|
|
|
$
|
171.8
|
|
|
$
|
—
|
|
|
indefinite
|
Customer relationships
|
|
37.1
|
|
|
222.9
|
|
|
160.0
|
|
|
140.0
|
|
|
20 years
|
||||
Market data customer relationships
|
|
53.6
|
|
|
322.0
|
|
|
60.0
|
|
|
64.4
|
|
|
15 years
|
||||
Technology
|
|
22.5
|
|
|
22.5
|
|
|
22.5
|
|
|
22.5
|
|
|
7 years
|
||||
Trademarks and trade names
|
|
1.0
|
|
|
6.0
|
|
|
1.8
|
|
|
1.2
|
|
|
2 years
|
||||
Goodwill
|
|
226.4
|
|
|
1,736.4
|
|
|
419.3
|
|
|
267.2
|
|
|
|
||||
|
|
$
|
436.1
|
|
|
$
|
2,882.5
|
|
|
$
|
835.4
|
|
|
$
|
495.3
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||
|
2017
|
|
2017
|
|||||
Revenue
|
|
$
|
446.0
|
|
|
$
|
605.8
|
|
Operating income
|
|
28.6
|
|
|
26.6
|
|
||
Net income
|
|
18.3
|
|
|
17.6
|
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
||||||||
|
2016
|
2017
|
|
2016
|
||||||
Revenue
|
$
|
639.0
|
|
$
|
1,269.9
|
|
|
$
|
1,320.6
|
|
Operating income
|
100.9
|
|
229.4
|
|
|
207.9
|
|
|||
Net income allocated to common stockholders
|
59.4
|
|
157.3
|
|
|
116.4
|
|
|||
Earnings per share:
|
|
|
|
|
||||||
Basic
|
$
|
0.53
|
|
$
|
1.40
|
|
|
$
|
1.04
|
|
Diluted
|
$
|
0.53
|
|
$
|
1.40
|
|
|
$
|
1.03
|
|
|
Employee Termination Benefits
|
||
Balance at December 31, 2016
|
$
|
0.4
|
|
Termination benefits accrued
|
20.3
|
|
|
Termination payments made
|
(15.2
|
)
|
|
Balance at June 30, 2017
|
$
|
5.5
|
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
Equity Method:
|
|
|
|
||||
Investment in Signal Trading Systems, LLC
|
$
|
12.6
|
|
|
$
|
12.4
|
|
Investment in EuroCCP
|
8.7
|
|
|
—
|
|
||
Total equity method investments
|
21.3
|
|
|
12.4
|
|
||
|
|
|
|
||||
Cost Method:
|
|
|
|
||||
Investment in OCC
|
30.3
|
|
|
30.3
|
|
||
Other cost method investments
|
30.4
|
|
|
30.2
|
|
||
Total cost method investments
|
60.7
|
|
|
60.5
|
|
||
|
|
|
|
||||
Total Investments
|
$
|
82.0
|
|
|
$
|
72.9
|
|
|
December 31, 2016
|
|||||||||||
Cost basis
|
Unrealized gains
|
Unrealized losses
|
Fair value
|
|||||||||
Money market funds
|
$
|
67.5
|
|
—
|
|
—
|
|
$
|
67.5
|
|
||
Total
|
$
|
67.5
|
|
$
|
—
|
|
$
|
—
|
|
$
|
67.5
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
|||||
Construction in progress
|
|
$
|
8.9
|
|
|
$
|
0.2
|
|
Building
|
|
77.3
|
|
|
77.0
|
|
||
Furniture and equipment
|
|
162.0
|
|
|
138.8
|
|
||
Total property and equipment
|
|
248.2
|
|
|
216.0
|
|
||
Less accumulated depreciation
|
|
(172.6
|
)
|
|
(160.1
|
)
|
||
Total property and equipment, net
|
|
$
|
75.6
|
|
|
$
|
55.9
|
|
|
June 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
Software development work in progress
|
$
|
7.8
|
|
|
$
|
12.3
|
|
Data processing software
|
217.7
|
|
|
222.6
|
|
||
Less accumulated depreciation
|
(180.0
|
)
|
|
(172.0
|
)
|
||
Data processing software, net
|
45.5
|
|
|
62.9
|
|
||
|
|
|
|
||||
Other assets (1)
|
11.1
|
|
|
9.8
|
|
||
Data processing software and other assets, net
|
$
|
56.6
|
|
|
$
|
72.7
|
|
|
|
|
|
U.S.
|
|
European
|
|
Global
|
|
Corporate Items
|
|
|
||||||||||||
|
|
Options
|
|
Equities
|
|
Equities
|
|
FX
|
|
and Eliminations
|
|
Total
|
||||||||||||
Balance as of December 31, 2016
|
|
$
|
7.7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18.8
|
|
|
$
|
26.5
|
|
Additions
|
|
226.4
|
|
|
1,736.4
|
|
|
419.3
|
|
|
267.2
|
|
|
—
|
|
|
2,649.3
|
|
||||||
Dispositions
|
|
(1.4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.4
|
)
|
||||||
Changes in foreign currency exchange rates
|
|
—
|
|
|
—
|
|
|
12.0
|
|
|
—
|
|
|
—
|
|
|
12.0
|
|
||||||
Balance as of June 30, 2017
|
|
$
|
232.7
|
|
|
$
|
1,736.4
|
|
|
$
|
431.3
|
|
|
$
|
267.2
|
|
|
$
|
18.8
|
|
|
$
|
2,686.4
|
|
|
|
|
|
U.S.
|
|
European
|
|
Global
|
|
Corporate Items
|
|
|
||||||||||||
|
|
Options
|
|
Equities
|
|
Equities
|
|
FX
|
|
and Eliminations
|
|
Total
|
||||||||||||
Balance as of December 31, 2016
|
|
$
|
2.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6.7
|
|
|
$
|
8.7
|
|
Additions
|
|
209.7
|
|
|
1,146.1
|
|
|
416.1
|
|
|
228.1
|
|
|
—
|
|
|
2,000.0
|
|
||||||
Dispositions
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
||||||
Amortization
|
|
(6.0
|
)
|
|
(29.7
|
)
|
|
(9.5
|
)
|
|
(11.4
|
)
|
|
(0.6
|
)
|
|
(57.2
|
)
|
||||||
Changes in foreign currency exchange rates
|
|
—
|
|
|
—
|
|
|
19.1
|
|
|
—
|
|
|
—
|
|
|
19.1
|
|
||||||
Balance as of June 30, 2017
|
|
$
|
205.5
|
|
|
$
|
1,116.4
|
|
|
$
|
425.7
|
|
|
$
|
216.7
|
|
|
$
|
6.1
|
|
|
$
|
1,970.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remaining
|
||||||||||
|
|
June 30, 2017
|
|
Weighted Average
|
||||||||||||||||||
|
|
|
|
U.S.
|
|
European
|
|
|
|
Corporate Items
|
|
Amortization
|
||||||||||
|
|
Options
|
|
Equities
|
|
Equities
|
|
Global FX
|
|
and Eliminations
|
|
Period (in years)
|
||||||||||
Trading registrations and licenses
|
|
$
|
95.5
|
|
|
$
|
572.7
|
|
|
$
|
179.7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Indefinite
|
Customer relationships
|
|
38.0
|
|
|
222.9
|
|
|
167.3
|
|
|
140.0
|
|
|
3.0
|
|
|
20
|
|||||
Market data customer relationships
|
|
53.6
|
|
|
322.0
|
|
|
62.8
|
|
|
64.4
|
|
|
—
|
|
|
15
|
|||||
Technology
|
|
23.4
|
|
|
22.5
|
|
|
23.5
|
|
|
22.5
|
|
|
4.0
|
|
|
7
|
|||||
Trademarks and tradenames
|
|
1.4
|
|
|
6.0
|
|
|
1.9
|
|
|
1.2
|
|
|
1.0
|
|
|
2
|
|||||
Other
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|||||
Accumulated amortization
|
|
(6.6
|
)
|
|
(29.7
|
)
|
|
(9.5
|
)
|
|
(11.4
|
)
|
|
(1.9
|
)
|
|
|
|||||
|
|
$
|
205.5
|
|
|
$
|
1,116.4
|
|
|
$
|
425.7
|
|
|
$
|
216.7
|
|
|
$
|
6.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Remaining
|
||||||||||
|
|
December 31, 2016
|
|
Weighted Average
|
||||||||||||||||||
|
|
|
|
U.S.
|
|
European
|
|
|
|
Corporate
|
|
Amortization
|
||||||||||
|
|
Options
|
|
Equities
|
|
Equities
|
|
Global FX
|
|
and Other
|
|
Period (in years)
|
||||||||||
Trading registrations and licenses
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
Customer relationships
|
|
0.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3.0
|
|
|
9
|
|||||
Market data customer relationships
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|||||
Technology
|
|
1.1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.0
|
|
|
4
|
|||||
Trademarks and tradenames
|
|
0.4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.0
|
|
|
6
|
|||||
Other
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|||||
Accumulated amortization
|
|
(0.6
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
|
|
|||||
|
|
$
|
2.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
6.7
|
|
|
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
|
|||||||
Compensation and benefit-related liabilities
|
$
|
11.9
|
|
|
$
|
25.1
|
|
Termination benefits
|
5.5
|
|
|
0.4
|
|
||
Royalties
|
18.2
|
|
|
17.8
|
|
||
Accrued liabilities
|
51.5
|
|
|
25.4
|
|
||
Marketing fee payable
|
9.0
|
|
|
7.2
|
|
||
Accounts payable
|
54.9
|
|
|
6.5
|
|
||
|
$
|
151.0
|
|
|
$
|
82.4
|
|
|
|
June 30,
|
|
December 31,
|
||||
|
|
2017
|
|
2016
|
||||
Term Loan Agreement
|
|
$
|
468.7
|
|
|
$
|
—
|
|
3.650% Senior Notes
|
|
643.6
|
|
|
—
|
|
||
1.950% Senior Notes
|
|
299.0
|
|
|
—
|
|
||
Revolving Credit Agreement
|
|
—
|
|
|
—
|
|
||
Total long-term debt
|
|
$
|
1,411.3
|
|
|
$
|
—
|
|
2017
|
$
|
—
|
|
2018
|
—
|
|
|
2019
|
300.0
|
|
|
2020
|
—
|
|
|
2021
|
—
|
|
|
Thereafter
|
1,125.0
|
|
|
Principal amounts repayable
|
1,425.0
|
|
|
Debt issuance cost
|
(7.9
|
)
|
|
Unamortized discount on Notes
|
(5.8
|
)
|
|
Total debt outstanding
|
$
|
1,411.3
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Components of interest expense:
|
|
|
|
|
|
|
|
|
||||||||
Contractual interest
|
|
$
|
10.9
|
|
|
$
|
—
|
|
|
$
|
18.5
|
|
|
$
|
—
|
|
Amortization of debt discount
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
||||
Amortization of debt issuance cost
|
|
1.4
|
|
|
—
|
|
|
2.3
|
|
|
—
|
|
||||
Interest expense
|
|
12.5
|
|
|
—
|
|
|
21.0
|
|
|
—
|
|
||||
Interest income
|
|
—
|
|
|
—
|
|
|
(0.6
|
)
|
|
—
|
|
||||
Interest expense, net
|
|
$
|
12.5
|
|
|
$
|
—
|
|
|
$
|
20.4
|
|
|
$
|
—
|
|
|
|
|
|
|
||||||||
|
Foreign
|
Unrealized
|
|
Total Other
|
||||||||
|
Currency
|
Investment
|
Post-Retirement
|
Comprehensive
|
||||||||
|
Translation
|
Gain/Loss
|
Benefits
|
Income
|
||||||||
Balance at December 31, 2016
|
$
|
—
|
|
$
|
—
|
|
$
|
(0.8
|
)
|
$
|
(0.8
|
)
|
Other comprehensive income
|
30.2
|
|
0.2
|
|
—
|
|
30.4
|
|
||||
Balance at June 30, 2017
|
$
|
30.2
|
|
$
|
0.2
|
|
$
|
(0.8
|
)
|
$
|
29.6
|
|
•
|
Level 1—Unadjusted inputs based on quoted markets for identical assets or liabilities.
|
•
|
Level 2—Observable inputs, either direct or indirect, not including Level 1, corroborated by market data or based upon quoted prices in non-active markets.
|
•
|
Level 3—Unobservable inputs that reflect management’s best assumptions of what market participants would use in valuing the asset or liability.
|
|
June 30, 2017
|
|||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||
Assets:
|
|
|
|
|
||||||||
Available-for-sale securities:
|
|
|
|
|
||||||||
U.S. Treasury securities
|
$
|
109.9
|
|
$
|
109.9
|
|
$
|
—
|
|
$
|
—
|
|
Trading securities:
|
|
|
|
|
||||||||
U.S. Treasury securities
|
0.5
|
|
0.5
|
|
—
|
|
—
|
|
||||
Money market funds
|
31.5
|
|
31.5
|
|
—
|
|
—
|
|
||||
Total assets
|
$
|
141.9
|
|
$
|
141.9
|
|
$
|
—
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
||||
Contingent consideration liability
|
$
|
56.2
|
|
$
|
—
|
|
$
|
—
|
|
$
|
56.2
|
|
Total liabilities
|
$
|
56.2
|
|
$
|
—
|
|
$
|
—
|
|
$
|
56.2
|
|
|
December 31, 2016
|
||||||||||||||
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
67.5
|
|
|
$
|
67.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total assets
|
$
|
67.5
|
|
|
$
|
67.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
June 30, 2017
|
|||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||
Assets:
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
148.6
|
|
$
|
148.6
|
|
$
|
—
|
|
$
|
—
|
|
Trading investments
|
0.5
|
|
0.5
|
|
—
|
|
—
|
|
||||
Available-for-sale investments
|
109.9
|
|
109.9
|
|
—
|
|
—
|
|
||||
Accounts receivable
|
231.3
|
|
231.3
|
|
—
|
|
—
|
|
||||
Income tax receivable
|
10.7
|
|
10.7
|
|
—
|
|
—
|
|
||||
Total assets
|
$
|
501.0
|
|
$
|
501.0
|
|
$
|
—
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
||||||||
Accounts payable
|
$
|
54.9
|
|
$
|
—
|
|
$
|
54.9
|
|
$
|
—
|
|
Section 31 fees payable
|
150.9
|
|
—
|
|
150.9
|
|
—
|
|
||||
Contingent consideration liability
|
56.2
|
|
—
|
|
—
|
|
56.2
|
|
||||
Long-term debt
|
1,411.3
|
|
—
|
|
1,411.3
|
|
—
|
|
||||
Total liabilities
|
$
|
1,673.3
|
|
$
|
—
|
|
$
|
1,617.1
|
|
$
|
56.2
|
|
|
December 31, 2016
|
|||||||||||
Total
|
Level 1
|
Level 2
|
Level 3
|
|||||||||
Assets:
|
|
|
|
|
||||||||
Cash and cash equivalents
|
$
|
97.3
|
|
$
|
97.3
|
|
$
|
—
|
|
$
|
—
|
|
Accounts receivable
|
76.7
|
|
76.7
|
|
—
|
|
—
|
|
||||
Income tax receivable
|
53.7
|
|
53.7
|
|
—
|
|
—
|
|
||||
Total assets
|
$
|
227.7
|
|
$
|
227.7
|
|
$
|
—
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
||||||||
Accounts payable
|
$
|
6.5
|
|
$
|
—
|
|
$
|
6.5
|
|
$
|
—
|
|
Total liabilities
|
$
|
6.5
|
|
$
|
—
|
|
$
|
6.5
|
|
$
|
—
|
|
|
Level 3 Financial Liabilities for the Six Months Ended June 30, 2017
|
||||||||||||
Balance at Beginning of Period
|
Acquired During Period
|
Settlements
|
Balances at end of period
|
||||||||||
Liabilities
|
|
|
|
|
|||||||||
Contingent consideration liability
|
$
|
—
|
|
$
|
56.2
|
|
$
|
—
|
|
$
|
56.2
|
|
|
Total Liabilities
|
$
|
—
|
|
$
|
56.2
|
|
$
|
—
|
|
$
|
56.2
|
|
|
Redeemable Noncontrolling Interest
|
||
Balance as at December 31, 2016
|
$
|
12.6
|
|
Net loss attributable to redeemable noncontrolling interest
|
(0.6
|
)
|
|
Redemption value adjustment
|
0.6
|
|
|
Balance as at June 30, 2017
|
$
|
12.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
|||||||||||||
|
|
|
|
U.S.
|
|
|
|
European
|
|
|
|
items and
|
|
|
|||||||||||||
|
|
Options
|
|
Equities
|
|
Futures
|
|
Equities
|
|
Global FX
|
|
eliminations
|
|
Total
|
|||||||||||||
Three months ended June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Revenues
|
|
$
|
233.5
|
|
|
$
|
331.1
|
|
|
$
|
37.5
|
|
|
$
|
27.6
|
|
|
10.9
|
|
|
$
|
0.2
|
|
|
$
|
640.8
|
|
Operating income (loss)
|
|
61.2
|
|
|
33.3
|
|
|
33.4
|
|
|
3.5
|
|
|
(4.1
|
)
|
|
(9.5
|
)
|
|
117.8
|
|
||||||
Three months ended June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Revenues
|
|
$
|
141.7
|
|
|
$
|
—
|
|
|
$
|
31.4
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
173.1
|
|
Operating income (loss)
|
|
53.6
|
|
|
—
|
|
|
26.5
|
|
|
—
|
|
|
—
|
|
|
(2.1
|
)
|
|
78.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate
|
|
|
||||||||||||||
|
|
|
|
U.S.
|
|
|
|
European
|
|
|
|
items and
|
|
|
||||||||||||||
|
|
Options
|
|
Equities
|
|
Futures
|
|
Equities
|
|
Global FX
|
|
eliminations
|
|
Total
|
||||||||||||||
Six Months Ended June 30, 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues
|
|
$
|
426.2
|
|
|
$
|
451.3
|
|
|
$
|
67.4
|
|
|
$
|
36.9
|
|
|
$
|
14.9
|
|
|
$
|
0.3
|
|
|
$
|
997.0
|
|
Operating income (loss)
|
|
126.2
|
|
|
45.5
|
|
|
59.3
|
|
|
5.1
|
|
|
(5.3
|
)
|
|
(86.9
|
)
|
|
143.9
|
|
|||||||
Six Months Ended June 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Revenues
|
|
$
|
287.6
|
|
|
$
|
—
|
|
|
$
|
56.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
343.6
|
|
Operating income (loss)
|
|
115.9
|
|
|
—
|
|
|
46.7
|
|
|
—
|
|
|
—
|
|
|
(5.1
|
)
|
|
157.5
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares
|
Weighted Average Exercise Price
|
Weighted Average Remaining Contractual Term (years)
|
Aggregate Intrinsic Value (in millions)
|
||||||
Outstanding, December 31, 2016
|
—
|
|
—
|
|
—
|
—
|
||||
Granted
|
683,390
|
|
$
|
22.45
|
|
4.8 years
|
$
|
40.1
|
|
|
Exercised
|
(172,166
|
)
|
$
|
17.20
|
|
|
|
|||
Outstanding and expected to vest at June 30, 2017
|
511,224
|
|
$
|
24.22
|
|
5.3 years
|
$
|
34.3
|
|
|
Exercisable at June 30, 2017
|
430,156
|
|
$
|
23.49
|
|
4.9 years
|
$
|
29.2
|
|
|
2017
|
Expected term (in years)
|
4.2
|
Expected volatility
|
19.8%
|
Expected dividend yield
|
1.3%
|
Risk-free rate
|
1.78%
|
Forfeiture rate
|
—%
|
Nonvested Options
|
Options
|
Weighted Average Grant-Date Fair Value
|
||||
January 1, 2017 - Nonvested
|
—
|
|
$
|
—
|
|
|
Vested
|
—
|
|
—
|
|
||
Granted
|
81,068
|
|
49.17
|
|
||
Forfeited
|
—
|
|
—
|
|
||
June 30, 2017 - Nonvested
|
81,068
|
|
$
|
49.17
|
|
|
Number of Shares
|
Weighted Average Grant Date Fair Value
|
||||
Nonvested stock at December 31, 2016
|
480,595
|
|
$
|
63.44
|
|
|
Granted
|
1,090,231
|
|
78.91
|
|
||
Vested
|
(379,955
|
)
|
66.03
|
|
||
Forfeited
|
(4,104
|
)
|
72.83
|
|
||
Nonvested stock at June 30, 2017
|
1,186,767
|
|
$
|
76.31
|
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
(in millions, except per share amounts)
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Basic EPS Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net Income
|
|
$
|
68.0
|
|
|
$
|
50.9
|
|
|
$
|
83.2
|
|
|
$
|
100.1
|
|
Loss attributable to noncontrolling interest
|
|
0.3
|
|
|
0.3
|
|
|
0.6
|
|
|
0.5
|
|
||||
Net Income Excluding Noncontrolling Interest
|
|
68.3
|
|
|
51.2
|
|
|
83.8
|
|
|
100.6
|
|
||||
Change in redemption value of noncontrolling interest
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|
(0.6
|
)
|
|
(0.5
|
)
|
||||
Earnings allocated to participating securities
|
|
(0.7
|
)
|
|
(0.2
|
)
|
|
(0.8
|
)
|
|
(0.4
|
)
|
||||
Net Income Allocated to Common Stockholders
|
|
$
|
67.3
|
|
|
$
|
50.7
|
|
|
$
|
82.4
|
|
|
$
|
99.7
|
|
Basic EPS Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding
|
|
112.1
|
|
|
81.3
|
|
|
102.1
|
|
|
81.6
|
|
||||
Basic Net Income Per Common Share
|
|
$
|
0.60
|
|
|
$
|
0.62
|
|
|
$
|
0.81
|
|
|
$
|
1.22
|
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted EPS Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net Income
|
|
$
|
68.0
|
|
|
$
|
50.9
|
|
|
$
|
83.2
|
|
|
$
|
100.1
|
|
Loss attributable to noncontrolling interest
|
|
0.3
|
|
|
0.3
|
|
|
0.6
|
|
|
0.5
|
|
||||
Net Income Excluding Noncontrolling Interest
|
|
68.3
|
|
|
51.2
|
|
|
83.8
|
|
|
100.6
|
|
||||
Change in redemption value of noncontrolling interest
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|
(0.6
|
)
|
|
(0.5
|
)
|
||||
Earnings allocated to participating securities
|
|
(0.7
|
)
|
|
(0.2
|
)
|
|
(0.8
|
)
|
|
(0.4
|
)
|
||||
Net Income Allocated to Common Stockholders
|
|
$
|
67.3
|
|
|
$
|
50.7
|
|
|
$
|
82.4
|
|
|
$
|
99.7
|
|
Diluted EPS Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding
|
|
112.1
|
|
|
81.3
|
|
|
102.1
|
|
|
81.6
|
|
||||
Dilutive common shares issued under stock program
|
|
0.4
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
||||
Total Dilutive Weighted Average Shares
|
|
112.5
|
|
|
81.3
|
|
|
102.3
|
|
|
$
|
81.6
|
|
|||
Diluted Net Income Per Common Share
|
|
$
|
0.60
|
|
|
$
|
0.62
|
|
|
$
|
0.81
|
|
|
$
|
1.22
|
|
|
|
|
|
|
|
•
|
trading volumes on our proprietary products such as the VIX options and futures and SPX options;
|
•
|
trading volumes in listed cash equity securities and ETPs in both the U.S. and Europe, volumes in listed equity options, and volumes in institutional FX trading, all of which are driven primarily by overall macroeconomic conditions;
|
•
|
the demand for the U.S. tape plan market data distributed by the Securities Information Processors (SIPs), which determines the pool size of the industry market data revenue we receive based on our market share;
|
•
|
the demand for information about, or access to, our markets, which is dependent on the products we trade, our importance as a liquidity center and the quality and pricing of our data and access services;
|
•
|
continuing pressure in transaction fee pricing due to intense competition in the United States and Europe; and
|
•
|
regulatory changes relating to market structure, increased capital requirements or affecting certain types of instruments, transactions, pricing structures, capital market participants or reporting or compliance requirements, including any changes resulting from Brexit.
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
|
Increase/
|
|
Percent
|
|
Six Months Ended June 30,
|
|
Increase/
|
|
Percent
|
||||||||||||||||||
2017
|
2016
|
|
(Decrease)
|
|
Change
|
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
||||||||||||||||
(in millions, except trading days, percentages and as noted below)
|
|
(in millions, except trading days, percentages and as noted below)
|
|||||||||||||||||||||||||||
Total revenues
|
$
|
640.8
|
|
|
$
|
173.1
|
|
|
$
|
467.7
|
|
|
270.2
|
%
|
|
$
|
997.0
|
|
|
$
|
343.6
|
|
|
$
|
653.4
|
|
|
190.2
|
%
|
Total cost of revenues
|
373.9
|
|
|
29.0
|
|
|
344.9
|
|
|
1,189.3
|
%
|
|
536.7
|
|
|
56.4
|
|
|
480.3
|
|
|
851.6
|
%
|
||||||
Revenues less cost of revenues
|
266.9
|
|
|
144.1
|
|
|
122.8
|
|
|
85.2
|
%
|
|
460.3
|
|
|
287.2
|
|
|
173.1
|
|
|
60.3
|
%
|
||||||
Total operating expenses
|
149.1
|
|
|
66.1
|
|
|
83.0
|
|
|
125.6
|
%
|
|
316.4
|
|
|
129.7
|
|
|
186.7
|
|
|
143.9
|
%
|
||||||
Operating income
|
117.8
|
|
|
78.0
|
|
|
39.8
|
|
|
51.0
|
%
|
|
143.9
|
|
|
157.5
|
|
|
(13.6
|
)
|
|
(8.6
|
)%
|
||||||
Income before income tax provision
|
106.1
|
|
|
83.8
|
|
|
22.3
|
|
|
26.6
|
%
|
|
124.4
|
|
|
164.3
|
|
|
(39.9
|
)
|
|
(24.3
|
)%
|
||||||
Income tax provision
|
38.1
|
|
|
32.9
|
|
|
5.2
|
|
|
15.8
|
%
|
|
41.2
|
|
|
64.2
|
|
|
(23.0
|
)
|
|
(35.8
|
)%
|
||||||
Net income
|
68.0
|
|
|
50.9
|
|
|
17.1
|
|
|
33.6
|
%
|
|
83.2
|
|
|
100.1
|
|
|
(16.9
|
)
|
|
(16.9
|
)%
|
||||||
Net income allocated to common stockholders
|
$
|
67.3
|
|
|
$
|
50.7
|
|
|
$
|
16.6
|
|
|
32.7
|
%
|
|
$
|
82.4
|
|
|
$
|
99.7
|
|
|
$
|
(17.3
|
)
|
|
(17.4
|
)%
|
Basic earnings per share
|
$
|
0.60
|
|
|
$
|
0.62
|
|
|
$
|
(0.02
|
)
|
|
(3.2
|
)%
|
|
$
|
0.81
|
|
|
$
|
1.22
|
|
|
$
|
(0.41
|
)
|
|
(33.6
|
)%
|
Diluted earnings per share
|
0.60
|
|
|
0.62
|
|
|
(0.02
|
)
|
|
(3.2
|
)%
|
|
0.81
|
|
|
1.22
|
|
|
(0.41
|
)
|
|
(33.6
|
)%
|
||||||
Organic net revenue (1)
|
152.0
|
|
|
144.1
|
|
|
7.9
|
|
|
5.5
|
%
|
|
306.2
|
|
|
287.2
|
|
|
19.0
|
|
|
6.6
|
%
|
||||||
EBITDA(2)
|
173.7
|
|
|
95.9
|
|
|
77.8
|
|
|
81.1
|
%
|
|
224.9
|
|
|
188.1
|
|
|
36.8
|
|
|
19.6
|
%
|
||||||
EBITDA margin(3)
|
65.1
|
%
|
|
66.6
|
%
|
|
(1.5
|
)%
|
|
*
|
|
|
48.9
|
%
|
|
65.5
|
%
|
|
(16.6
|
)%
|
|
*
|
|
Adjusted EBITDA(2)
|
$
|
178.9
|
|
|
$
|
91.6
|
|
|
$
|
87.3
|
|
|
95.3
|
%
|
|
$
|
304.6
|
|
|
$
|
184.6
|
|
|
$
|
120.0
|
|
|
65.0
|
%
|
Adjusted EBITDA margin(4)
|
67.0
|
%
|
|
63.6
|
%
|
|
3.4
|
%
|
|
*
|
|
|
66.2
|
%
|
|
64.3
|
%
|
|
1.9
|
%
|
|
*
|
|
||||||
Adjusted earnings(5)
|
$
|
98.0
|
|
|
$
|
48.7
|
|
|
$
|
49.3
|
|
|
101.2
|
%
|
|
$
|
170.2
|
|
|
$
|
98.6
|
|
|
$
|
71.6
|
|
|
72.6
|
%
|
Diluted weighted average shares outstanding
|
112.5
|
|
|
81.3
|
|
|
31.2
|
|
|
38.4
|
%
|
|
102.3
|
|
|
81.6
|
|
|
20.7
|
|
|
25.4
|
%
|
||||||
Diluted adjusted earnings per share
|
$
|
0.87
|
|
|
$
|
0.60
|
|
|
$
|
0.27
|
|
|
45.1
|
%
|
|
$
|
1.66
|
|
|
$
|
1.21
|
|
|
$
|
0.45
|
|
|
37.2
|
%
|
Options:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Average Daily Volume (ADV):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total touched contracts
|
7.0
|
|
|
6.1
|
|
|
0.9
|
|
|
14.8
|
%
|
|
6.9
|
|
|
6.2
|
|
|
0.7
|
|
|
11.3
|
%
|
||||||
Market ADV
|
16.7
|
|
|
15.8
|
|
|
0.9
|
|
|
5.7
|
%
|
|
16.6
|
|
|
16.4
|
|
|
0.2
|
|
|
1.2
|
%
|
||||||
Index contract ADV
|
1.9
|
|
|
1.7
|
|
|
0.2
|
|
|
11.8
|
%
|
|
1.9
|
|
|
1.8
|
|
|
0.1
|
|
|
5.6
|
%
|
||||||
Trading days
|
63
|
|
|
64
|
|
|
(1
|
)
|
|
(1.6
|
)%
|
|
125
|
|
|
125
|
|
|
—
|
|
|
—
|
%
|
||||||
U.S. Equities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
ADV:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Matched shares ADV (in billions)
|
1.3
|
|
|
—
|
|
|
1.3
|
|
|
*
|
|
|
1.3
|
|
|
—
|
|
|
1.3
|
|
|
*
|
|
||||||
Routed shares ADV (in billions)
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
*
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
*
|
|
||||||
Total touched shares ADV (in billions)
|
1.4
|
|
|
—
|
|
|
1.4
|
|
|
*
|
|
|
1.4
|
|
|
—
|
|
|
1.4
|
|
|
*
|
|
||||||
Market ADV (in billions)
|
6.9
|
|
|
—
|
|
|
6.9
|
|
|
*
|
|
|
6.9
|
|
|
—
|
|
|
6.9
|
|
|
*
|
|
||||||
Trading days
|
63
|
|
|
—
|
|
|
63
|
|
|
*
|
|
|
86
|
|
|
—
|
|
|
86
|
|
|
*
|
|
||||||
U.S. ETPs: launches (number of launches)
|
26
|
|
|
—
|
|
|
26
|
|
|
*
|
|
|
41
|
|
|
—
|
|
|
41
|
|
|
*
|
|
||||||
U.S. ETPs: listings (number of listings)
|
181
|
|
|
—
|
|
|
181
|
|
|
*
|
|
|
181
|
|
|
—
|
|
|
181
|
|
|
*
|
|
||||||
Futures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
ADV (in thousands)
|
306.8
|
|
|
258.2
|
|
|
48.6
|
|
|
18.8
|
%
|
|
296.4
|
|
|
237.8
|
|
|
58.6
|
|
|
24.6
|
%
|
||||||
Trading days
|
63
|
|
|
64
|
|
|
(1
|
)
|
|
(1.6
|
)%
|
|
125
|
|
|
125
|
|
|
—
|
|
|
—
|
%
|
||||||
European Equities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Average Daily Notional Value (ADNV):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Matched and touched ADNV (in billions)
|
€
|
10.3
|
|
|
€
|
—
|
|
|
€
|
10.3
|
|
|
*
|
|
|
€
|
10.3
|
|
|
€
|
—
|
|
|
€
|
10.3
|
|
|
*
|
|
Market ADNV (in billions)
|
€
|
48.6
|
|
|
€
|
—
|
|
|
€
|
48.6
|
|
|
*
|
|
|
€
|
48.3
|
|
|
€
|
—
|
|
|
€
|
48.3
|
|
|
*
|
|
Trading days
|
63
|
|
|
—
|
|
|
63
|
|
|
*
|
|
|
86
|
|
|
—
|
|
|
86
|
|
|
*
|
|
||||||
Average Euro/British pound exchange rate
|
£
|
0.856
|
|
|
£
|
0.788
|
|
|
£
|
0.068
|
|
|
8.6
|
%
|
|
£
|
0.861
|
|
|
£
|
0.783
|
|
|
£
|
0.078
|
|
|
10.0
|
%
|
Global FX:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
ADNV (in billions)
|
$
|
27.9
|
|
|
$
|
—
|
|
|
$
|
27.9
|
|
|
*
|
|
|
$
|
28.4
|
|
|
$
|
—
|
|
|
$
|
28.4
|
|
|
*
|
|
Trading days
|
65
|
|
|
—
|
|
|
65
|
|
|
*
|
|
|
88
|
|
|
—
|
|
|
88
|
|
|
*
|
|
||||||
Market share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Options
|
42.2
|
%
|
|
27.2
|
%
|
|
15
|
%
|
|
*
|
|
|
38.2
|
%
|
|
26.9
|
%
|
|
11.3
|
%
|
|
*
|
|
||||||
U.S. Equities
|
19.2
|
%
|
|
—
|
%
|
|
19.2
|
%
|
|
*
|
|
|
19.2
|
%
|
|
—
|
%
|
|
19.2
|
%
|
|
*
|
|
||||||
ETPs: launches
|
42.6
|
%
|
|
—
|
%
|
|
42.6
|
%
|
|
*
|
|
|
38.3
|
%
|
|
—
|
%
|
|
38.3
|
%
|
|
*
|
|
||||||
ETPs: listings
|
8.9
|
%
|
|
—
|
%
|
|
8.9
|
%
|
|
*
|
|
|
8.9
|
%
|
|
—
|
%
|
|
8.9
|
%
|
|
*
|
|
||||||
European Equities
|
21.3
|
%
|
|
—
|
%
|
|
21.3
|
%
|
|
*
|
|
|
21.3
|
%
|
|
—
|
%
|
|
21.3
|
%
|
|
*
|
|
||||||
Net capture:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total Options (revenue per contract)(6)
|
$
|
0.225
|
|
|
$
|
0.328
|
|
|
$
|
(0.103
|
)
|
|
(31.4
|
)%
|
|
$
|
0.253
|
|
|
$
|
0.337
|
|
|
$
|
(0.084
|
)
|
|
(24.9
|
)%
|
Multiply Listed Options
|
0.058
|
|
|
0.086
|
|
|
(0.028
|
)
|
|
(32.6
|
)%
|
|
0.063
|
|
|
0.093
|
|
|
(0.031
|
)
|
|
(32.3
|
)%
|
||||||
Index Options
|
0.694
|
|
|
0.701
|
|
|
(0.007
|
)
|
|
(1.0
|
)%
|
|
0.701
|
|
|
0.711
|
|
|
(0.010
|
)
|
|
(1.4
|
)%
|
||||||
U.S. Equities (net capture per one hundred touched shares)(7)
|
0.023
|
|
|
—
|
|
|
0.023
|
|
|
*
|
|
|
0.023
|
|
|
—
|
|
|
0.023
|
|
|
*
|
|
||||||
Futures
|
1.762
|
|
|
1.682
|
|
|
0.080
|
|
|
4.8
|
%
|
|
1.765
|
|
|
1.664
|
|
|
0.101
|
|
|
6.1
|
%
|
European Equities (net capture per matched notional value in basis points)(8)
|
0.162
|
|
|
—
|
|
|
0.162
|
|
|
*
|
|
|
0.162
|
|
|
—
|
|
|
0.162
|
|
|
*
|
|
||||||
Global FX (net capture per one million dollars traded) (9)
|
$
|
2.65
|
|
|
$
|
—
|
|
|
$
|
2.65
|
|
|
*
|
|
|
$
|
2.64
|
|
|
$
|
—
|
|
|
$
|
2.64
|
|
|
*
|
|
Average British pound/U.S. dollar exchange rate
|
$
|
1.278
|
|
|
$
|
1.434
|
|
|
$
|
(0.156
|
)
|
|
(10.9
|
)%
|
|
$
|
1.256
|
|
|
$
|
1.433
|
|
|
$
|
(0.177
|
)
|
|
(12.4
|
)%
|
(1)
|
Organic net revenue is defined as revenues less cost of revenues excluding revenues less cost of revenues of any acquisition for the quarter the business was acquired and the following year comparable quarter. Organic net revenue does not represent, and should not be considered as, an alternative to revenues less cost of revenues, or net revenue, as determined in accordance with GAAP. We have presented organic net revenue because we consider it an important supplemental measure of our performance and we use it as the basis for monitoring our operating financial performance before the effects of acquisitions. We also believe that it is frequently used by analysts, investors and other interested parties in the evaluation of companies. We believe that investors may find this non-GAAP measure useful in evaluating our performance compared to that of peer companies in our industry. Other companies may calculate organic net revenue differently than we do. Organic net revenue has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP.
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
2017
|
|
2016
|
|
2017
|
|
2016
|
|||||||||
Revenues less cost of revenues
|
$
|
266.9
|
|
|
$
|
144.1
|
|
|
$
|
460.3
|
|
|
$
|
287.2
|
|
Recent acquisitions:
|
|
|
|
|
|
|
|
||||||||
Bats revenues less cost of revenues (since acquisition)
|
$
|
(114.9
|
)
|
|
$
|
—
|
|
|
$
|
(154.1
|
)
|
|
$
|
—
|
|
Organic net revenue
|
$
|
152.0
|
|
|
$
|
144.1
|
|
|
$
|
306.2
|
|
|
$
|
287.2
|
|
(2)
|
EBITDA is defined as income before interest, income taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA before acquisition-related costs, accelerated stock-based compensation, and a legal settlement. EBITDA and adjusted EBITDA do not represent, and should not be considered as, alternatives to net income or cash flows from operations, each as determined in accordance with GAAP. We have presented EBITDA and adjusted EBITDA because we consider them important supplemental measures of our performance and believe that they are frequently used by analysts, investors and other interested parties in the evaluation of companies. In addition, we use adjusted EBITDA as a measure of operating performance for preparation of our forecasts, evaluating our leverage ratio for the debt to earnings covenant included in our outstanding credit facility. Other companies may calculate EBITDA and adjusted EBITDA differently than we do. EBITDA and adjusted EBITDA have limitations as analytical tools, and you should not consider them in isolation or as substitutes for analysis of our results as reported under GAAP.
|
|
Three Months Ended June 30, 2017
|
||||||||||||||||||||
Options
|
U.S. Equities
|
Futures
|
European Equities
|
Global FX
|
Corporate Items and Eliminations
|
Total
|
|||||||||||||||
Net income (loss) allocated to common stockholders
|
$
|
34.7
|
|
$
|
32.8
|
|
$
|
33.4
|
|
$
|
1.8
|
|
$
|
(4.2
|
)
|
$
|
(31.2
|
)
|
$
|
67.3
|
|
Interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
12.5
|
|
12.5
|
|
|||||||
Income tax provision
|
35.6
|
|
0.6
|
|
—
|
|
1.8
|
|
0.1
|
|
—
|
|
38.1
|
|
|||||||
Depreciation and amortization
|
14.2
|
|
24.4
|
|
0.4
|
|
7.4
|
|
9.1
|
|
0.3
|
|
55.8
|
|
|||||||
EBITDA
|
84.5
|
|
57.8
|
|
33.8
|
|
11.0
|
|
5.0
|
|
(18.4
|
)
|
173.7
|
|
|||||||
Acquisition-related costs
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
4.7
|
|
4.7
|
|
|||||||
Change in contingent consideration
|
—
|
|
—
|
|
—
|
|
—
|
|
0.5
|
|
—
|
|
0.5
|
|
|||||||
Adjusted EBITDA
|
$
|
84.5
|
|
$
|
57.8
|
|
$
|
33.8
|
|
$
|
11.0
|
|
$
|
5.5
|
|
$
|
(13.7
|
)
|
$
|
178.9
|
|
|
Three Months Ended June 30, 2016
|
||||||||||||||||||||
Options
|
U.S. Equities
|
Futures
|
European Equities
|
Global FX
|
Corporate Items and Eliminations
|
Total
|
|||||||||||||||
Net income (loss) allocated to common stockholders
|
$
|
21.0
|
|
$
|
—
|
|
$
|
26.5
|
|
$
|
—
|
|
$
|
—
|
|
$
|
3.2
|
|
$
|
50.7
|
|
Interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Income tax provision
|
32.9
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
32.9
|
|
|||||||
Depreciation and amortization
|
11.0
|
|
—
|
|
0.9
|
|
—
|
|
—
|
|
0.4
|
|
12.3
|
|
|||||||
EBITDA
|
64.9
|
|
—
|
|
27.4
|
|
—
|
|
—
|
|
3.6
|
|
95.9
|
|
|||||||
Acquisition-related costs
|
—
|
|
|
|
|
|
—
|
|
—
|
|
0.3
|
|
0.3
|
|
|||||||
Legal settlement
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5.5
|
)
|
(5.5
|
)
|
|||||||
Accelerated stock-based compensation
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
0.9
|
|
0.9
|
|
|||||||
Adjusted EBITDA
|
$
|
64.9
|
|
$
|
—
|
|
$
|
27.4
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(0.7
|
)
|
$
|
91.6
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||||||||
|
Options
|
U.S. Equities
|
Futures
|
European Equities
|
Global FX
|
Corporate Items and Eliminations
|
Total
|
||||||||||||||
Net income (loss) allocated to common stockholders
|
$
|
97.6
|
|
$
|
44.7
|
|
$
|
59.3
|
|
$
|
2.7
|
|
$
|
(5.4
|
)
|
$
|
(116.5
|
)
|
$
|
82.4
|
|
Interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
20.4
|
|
20.4
|
|
|||||||
Income tax provision
|
37.7
|
|
0.9
|
|
—
|
|
2.5
|
|
0.1
|
|
—
|
|
41.2
|
|
|||||||
Depreciation and amortization
|
25.1
|
|
32.5
|
|
0.7
|
|
9.9
|
|
12.1
|
|
0.6
|
|
80.9
|
|
|||||||
EBITDA
|
160.4
|
|
78.1
|
|
60.0
|
|
15.1
|
|
6.8
|
|
(95.5
|
)
|
224.9
|
|
|||||||
Acquisition-related costs
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
69.9
|
|
69.9
|
|
|||||||
Change in contingent consideration
|
—
|
|
—
|
|
—
|
|
—
|
|
0.7
|
|
—
|
|
0.7
|
|
|||||||
Accelerated stock-based compensation
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
9.1
|
|
9.1
|
|
|||||||
Adjusted EBITDA
|
$
|
160.4
|
|
$
|
78.1
|
|
$
|
60.0
|
|
$
|
15.1
|
|
$
|
7.5
|
|
$
|
(16.5
|
)
|
$
|
304.6
|
|
|
Six Months Ended June 30, 2016
|
||||||||||||||||||||
|
Options
|
U.S. Equities
|
Futures
|
European Equities
|
Global FX
|
Corporate Items and Eliminations
|
Total
|
||||||||||||||
Net income (loss) allocated to common stockholders
|
$
|
53.0
|
|
$
|
—
|
|
$
|
46.7
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
99.7
|
|
Interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
Income tax provision
|
64.2
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
64.2
|
|
|||||||
Depreciation and amortization
|
21.7
|
|
—
|
|
1.8
|
|
—
|
|
—
|
|
0.7
|
|
24.2
|
|
|||||||
EBITDA
|
138.9
|
|
—
|
|
48.5
|
|
—
|
|
—
|
|
0.7
|
|
188.1
|
|
|||||||
Acquisition-related costs
|
—
|
|
|
|
|
|
—
|
|
—
|
|
0.6
|
|
0.6
|
|
|||||||
Legal settlement
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(5.5
|
)
|
(5.5
|
)
|
|||||||
Assessment of computer-based lease taxes for prior period use
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
0.3
|
|
0.3
|
|
|||||||
Accelerated stock-based compensation
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
1.1
|
|
1.1
|
|
|||||||
Adjusted EBITDA
|
$
|
138.9
|
|
$
|
—
|
|
$
|
48.5
|
|
$
|
—
|
|
$
|
—
|
|
$
|
(2.8
|
)
|
$
|
184.6
|
|
(3)
|
EBITDA margin represents EBITDA divided by revenues less cost of revenues.
|
(4)
|
Adjusted EBITDA margin represents adjusted EBITDA divided by revenues less cost of revenues.
|
(5)
|
Adjusted earnings is defined as net income adjusted for amortization of purchased intangibles, acquisition-related costs, legal settlements, and accelerated stock-based compensation, net of the income tax effects of these adjustments. Adjusted earnings does not represent, and should not be considered as, an alternative to net income, as determined in accordance with GAAP. We have presented adjusted earnings because we consider it an important supplemental measure of our performance and we use it as the basis for monitoring our own core operating financial performance relative to other operators of exchanges. We also believe that it is frequently used by analysts, investors and other interested parties in the evaluation of companies. We believe that investors may find this non-GAAP measure useful in evaluating our performance compared to that of peer companies in our industry. Other companies may calculate adjusted earnings differently than we do. Adjusted earnings has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP.
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
2017
|
|
2016
|
|
2017
|
|
2016
|
|||||||||
Net income allocated to common stockholders
|
$
|
67.3
|
|
|
$
|
50.7
|
|
|
$
|
82.4
|
|
|
$
|
99.7
|
|
Amortization
|
42.6
|
|
|
0.4
|
|
|
57.0
|
|
|
0.6
|
|
||||
Acquisition-related costs
|
4.7
|
|
|
0.3
|
|
|
69.9
|
|
|
0.7
|
|
||||
Debt issuance cost
|
0.9
|
|
|
—
|
|
|
0.9
|
|
|
—
|
|
||||
Assessment of computer-based lease taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
||||
Acceleration of stock based compensation
|
—
|
|
|
—
|
|
|
9.1
|
|
|
—
|
|
||||
Other compensation related items
|
—
|
|
|
0.9
|
|
|
—
|
|
|
1.1
|
|
||||
Legal settlement
|
—
|
|
|
(5.5
|
)
|
|
—
|
|
|
(5.5
|
)
|
||||
Interest and other borrowing costs
|
—
|
|
|
—
|
|
|
4.3
|
|
|
—
|
|
||||
Change in contingent consideration
|
0.5
|
|
|
—
|
|
|
0.7
|
|
|
—
|
|
||||
Change in redemption value of noncontrolling interest
|
0.3
|
|
|
0.3
|
|
|
0.6
|
|
|
0.5
|
|
||||
Tax effects of adjustments
|
(18.0
|
)
|
|
1.6
|
|
|
(54.0
|
)
|
|
1.2
|
|
||||
Net income allocated to participating securities
|
(0.3
|
)
|
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
||||
Adjusted earnings
|
$
|
98.0
|
|
|
$
|
48.7
|
|
|
$
|
170.2
|
|
|
$
|
98.6
|
|
(6)
|
Revenue per contract represents transaction fees less liquidity payments and routing and clearing costs
|
(7)
|
Net capture per one hundred 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 for the period.
|
(8)
|
Net capture per matched notional value refers to transaction fees less liquidity payments in British pounds divided by the product of ADNV in British pounds of shares matched on Bats Europe and the number of trading days for the period.
|
(9)
|
Net capture per one million dollars traded refers to transaction fees less liquidity payments, if any, divided by the product of one-thousandth of ADNV traded on the Hotspot FX market and the number of trading days, divided by two, which represents the buyer and seller that are both charged on the transaction for the period.
|
|
Three Months Ended
June 30, |
Increase/ (Decrease)
|
Percent Change
|
|
Six Months Ended
June 30, |
Increase/ (Decrease)
|
Percent Change
|
||||||||||||||||
2017
|
2016
|
|
2017
|
2016
|
|||||||||||||||||||
(in millions, except percentages)
|
|
(in millions, except percentages)
|
|||||||||||||||||||||
Transaction fees
|
$
|
453.9
|
|
$
|
127.6
|
|
$
|
326.3
|
|
255.7
|
%
|
|
$
|
710.3
|
|
$
|
253.8
|
|
$
|
456.5
|
|
179.9
|
%
|
Access fees
|
29.7
|
|
13.2
|
|
16.5
|
|
125.0
|
%
|
|
47.5
|
|
26.4
|
|
21.1
|
|
79.9
|
%
|
||||||
Exchange services and other fees
|
19.9
|
|
11.4
|
|
8.5
|
|
74.6
|
%
|
|
35.3
|
|
22.8
|
|
12.5
|
|
54.8
|
%
|
||||||
Market data fees
|
48.0
|
|
8.2
|
|
39.8
|
|
485.4
|
%
|
|
70.5
|
|
16.2
|
|
54.3
|
|
335.2
|
%
|
||||||
Regulatory fees
|
83.3
|
|
9.2
|
|
74.1
|
|
805.4
|
%
|
|
121.6
|
|
18.3
|
|
103.3
|
|
564.5
|
%
|
||||||
Other revenue
|
6.0
|
|
3.5
|
|
2.5
|
|
71.4
|
%
|
|
11.8
|
|
6.1
|
|
5.7
|
|
93.4
|
%
|
||||||
Total revenues
|
$
|
640.8
|
|
$
|
173.1
|
|
$
|
467.7
|
|
270.2
|
%
|
|
$
|
997.0
|
|
$
|
343.6
|
|
$
|
653.4
|
|
190.2
|
%
|
|
Three Months Ended
June 30, |
Increase/ (Decrease)
|
Percent Change
|
|
Six Months Ended
June 30, |
Increase/ (Decrease)
|
Percent Change
|
||||||||||||||||
2017
|
2016
|
|
2017
|
2016
|
|||||||||||||||||||
|
(in millions, except percentages)
|
|
(in millions, except percentages)
|
||||||||||||||||||||
Liquidity payments
|
$
|
266.5
|
|
$
|
7.1
|
|
$
|
259.4
|
|
*
|
|
|
$
|
371.8
|
|
$
|
13.7
|
|
$
|
358.1
|
|
*
|
|
Routing and clearing
|
12.2
|
|
2.6
|
|
9.6
|
|
369.2
|
%
|
|
18.5
|
|
4.3
|
|
14.2
|
|
330.2
|
%
|
||||||
Section 31 fees
|
74.6
|
|
—
|
|
74.6
|
|
*
|
|
|
104.6
|
|
—
|
|
104.6
|
|
*
|
|
||||||
Royalty fees
|
20.6
|
|
19.3
|
|
1.3
|
|
6.7
|
%
|
|
41.8
|
|
38.4
|
|
3.4
|
|
8.9
|
%
|
||||||
Total cost of revenues
|
$
|
373.9
|
|
$
|
29.0
|
|
$
|
344.9
|
|
1,189.3
|
%
|
|
$
|
536.7
|
|
$
|
56.4
|
|
$
|
480.3
|
|
851.6
|
%
|
|
Three Months Ended
June 30, |
Increase/
|
Percent
|
|
Six Months Ended
June 30, |
Increase/
|
Percent
|
||||||||||||||||
|
2017
|
2016
|
(Decrease)
|
Change
|
|
2017
|
2016
|
(Decrease)
|
Change
|
||||||||||||||
|
(in millions, except percentages)
|
|
(in millions, except percentages)
|
||||||||||||||||||||
Transaction fees less liquidity payments and routing and clearing costs
|
$
|
175.2
|
|
$
|
117.9
|
|
$
|
57.3
|
|
48.6
|
%
|
|
$
|
320.0
|
|
$
|
235.8
|
|
$
|
84.2
|
|
35.7
|
%
|
Access fees
|
29.7
|
|
13.2
|
|
16.5
|
|
125.0
|
%
|
|
47.5
|
|
26.4
|
|
21.1
|
|
79.9
|
%
|
||||||
Exchange services and other fees
|
19.9
|
|
11.4
|
|
8.5
|
|
74.6
|
%
|
|
35.3
|
|
22.8
|
|
12.5
|
|
54.8
|
%
|
||||||
Market data fees
|
48.0
|
|
8.2
|
|
39.8
|
|
485.4
|
%
|
|
70.5
|
|
16.2
|
|
54.3
|
|
335.2
|
%
|
||||||
Regulatory fees, less Section 31 fees
|
8.7
|
|
9.2
|
|
(0.5
|
)
|
(5.4
|
)%
|
|
17.0
|
|
18.3
|
|
(1.3
|
)
|
(7.1
|
)%
|
||||||
Royalty fees
|
(20.6
|
)
|
(19.3
|
)
|
(1.3
|
)
|
6.7
|
%
|
|
(41.8
|
)
|
(38.4
|
)
|
(3.4
|
)
|
8.9
|
%
|
||||||
Other
|
6.0
|
|
3.5
|
|
2.5
|
|
71.4
|
%
|
|
11.8
|
|
6.1
|
|
5.7
|
|
93.4
|
%
|
||||||
Revenues less cost of revenues
|
$
|
266.9
|
|
$
|
144.1
|
|
$
|
122.8
|
|
85.2
|
%
|
|
$
|
460.3
|
|
$
|
287.2
|
|
$
|
173.1
|
|
60.3
|
%
|
|
Three Months Ended
June 30, |
Increase/
|
Percent
|
|
Six Months Ended
June 30, |
Increase/
|
Percent
|
||||||||||||||||
2017
|
2016
|
(Decrease)
|
Change
|
|
2017
|
2016
|
(Decrease)
|
Change
|
|||||||||||||||
(in millions, except percentages)
|
|
(in millions, except percentages)
|
|||||||||||||||||||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Compensation and benefits
|
$
|
50.0
|
|
$
|
28.5
|
|
$
|
21.5
|
|
75.4
|
%
|
|
$
|
97.8
|
|
$
|
55.6
|
|
$
|
42.2
|
|
75.9
|
%
|
Depreciation and amortization
|
55.8
|
|
12.3
|
|
43.5
|
|
353.7
|
%
|
|
80.9
|
|
24.2
|
|
56.7
|
|
234.3
|
%
|
||||||
Technology support services
|
12.0
|
|
5.7
|
|
6.3
|
|
110.5
|
%
|
|
19.5
|
|
11.4
|
|
8.1
|
|
71.1
|
%
|
||||||
Professional fees and outside services
|
16.9
|
|
14.7
|
|
2.2
|
|
15.0
|
%
|
|
31.3
|
|
28.3
|
|
3.0
|
|
10.6
|
%
|
||||||
Travel and promotional expenses
|
4.2
|
|
2.5
|
|
1.7
|
|
68.0
|
%
|
|
7.5
|
|
5.0
|
|
2.5
|
|
50.0
|
%
|
||||||
Facilities costs
|
2.7
|
|
1.4
|
|
1.3
|
|
92.9
|
%
|
|
4.8
|
|
2.9
|
|
1.9
|
|
65.5
|
%
|
||||||
Acquisition-related costs
|
4.7
|
|
—
|
|
4.7
|
|
*
|
|
|
69.9
|
|
—
|
|
69.9
|
|
*
|
|
||||||
Change in contingent consideration
|
0.5
|
|
—
|
|
0.5
|
|
*
|
|
|
0.7
|
|
—
|
|
0.7
|
|
*
|
|
||||||
Other expenses
|
2.3
|
|
1.0
|
|
1.3
|
|
130.0
|
%
|
|
4.0
|
|
2.3
|
|
1.7
|
|
73.9
|
%
|
||||||
Total operating expenses
|
$
|
149.1
|
|
$
|
66.1
|
|
$
|
83.0
|
|
125.6
|
%
|
|
$
|
316.4
|
|
$
|
129.7
|
|
$
|
186.7
|
|
143.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
|||||||||||||||
|
Three Months Ended
June 30, |
|
Percent Change
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|
Percent Change
|
|
Six Months Ended
June 30, |
|||||||||||||||||||||||
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
2017
|
|
2016
|
|||||||||||||||||
Options
|
|
$
|
233.5
|
|
|
$
|
141.7
|
|
|
64.8
|
%
|
|
36.4
|
%
|
|
81.9
|
%
|
|
$
|
426.2
|
|
|
$
|
287.6
|
|
|
48.2
|
%
|
|
42.8
|
%
|
|
83.7
|
%
|
U.S. Equities
|
|
331.1
|
|
|
—
|
|
|
*
|
|
|
51.7
|
%
|
|
—
|
%
|
|
451.3
|
|
|
—
|
|
|
*
|
|
|
45.3
|
%
|
|
—
|
%
|
||||
Futures
|
|
37.5
|
|
|
31.4
|
|
|
19.4
|
%
|
|
5.9
|
%
|
|
18.1
|
%
|
|
67.4
|
|
|
56.0
|
|
|
20.4
|
%
|
|
6.7
|
%
|
|
16.3
|
%
|
||||
European Equities
|
|
27.6
|
|
|
—
|
|
|
*
|
|
|
4.3
|
%
|
|
—
|
%
|
|
36.9
|
|
|
—
|
|
|
*
|
|
|
3.7
|
%
|
|
—
|
%
|
||||
Global FX
|
|
10.9
|
|
|
—
|
|
|
*
|
|
|
1.7
|
%
|
|
—
|
%
|
|
14.9
|
|
|
—
|
|
|
*
|
|
|
1.5
|
%
|
|
—
|
%
|
||||
Corporate Items and Eliminations
|
|
0.2
|
|
|
—
|
|
|
*
|
|
|
—
|
%
|
|
—
|
%
|
|
0.3
|
|
|
—
|
%
|
|
*
|
|
|
—
|
%
|
|
—
|
%
|
||||
Total revenues
|
|
$
|
640.8
|
|
|
$
|
173.1
|
|
|
270.2
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
$
|
997.0
|
|
|
$
|
343.6
|
|
|
190.2
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
|
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
||||||||||
|
Three Months Ended
June 30, |
Percent
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|
Percent
|
|
Six Months Ended
June 30, |
||||||||||||||||||
2017
|
2016
|
Change
|
|
2017
|
2016
|
|
2017
|
2016
|
|
Change
|
|
2017
|
2016
|
|||||||||||||||
|
(in millions, except percentages)
|
|||||||||||||||||||||||||||
Revenues less cost of revenues
|
$
|
126.7
|
|
$
|
113.9
|
|
11.2
|
%
|
|
19.8
|
%
|
65.8
|
%
|
|
$
|
255.6
|
|
$
|
233.3
|
|
|
9.6
|
%
|
|
25.6
|
%
|
67.9
|
%
|
Operating expenses
|
65.5
|
|
60.3
|
|
8.6
|
%
|
|
10.2
|
%
|
34.8
|
%
|
|
129.4
|
|
117.4
|
|
|
10.2%
|
|
13.0
|
%
|
34.2
|
%
|
|||||
Operating income
|
$
|
61.2
|
|
$
|
53.6
|
|
14.2
|
%
|
|
9.6
|
%
|
31.0
|
%
|
|
$
|
126.2
|
|
$
|
115.9
|
|
|
8.9
|
%
|
|
12.6
|
%
|
33.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
EBITDA (1)
|
$
|
84.5
|
|
$
|
64.9
|
|
30.2
|
%
|
|
13.2
|
%
|
37.5
|
%
|
|
$
|
160.4
|
|
$
|
138.9
|
|
|
15.5
|
%
|
|
16.1
|
%
|
40.4
|
%
|
EBITDA margin (2)
|
66.7
|
%
|
57.0
|
%
|
*
|
|
*
|
*
|
|
62.8
|
%
|
59.5
|
%
|
|
*
|
|
*
|
*
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
||||||||||
|
Three Months Ended
June 30, |
Percent
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
Percent
|
|
Six Months Ended
June 30, |
||||||||||||||||
2017
|
2016
|
Change
|
|
2017
|
2016
|
|
2017
|
2016
|
Change
|
|
2017
|
2016
|
|||||||||||||
|
(in millions, except percentages)
|
||||||||||||||||||||||||
Revenues less cost of revenues
|
$
|
74.4
|
|
$
|
—
|
|
*
|
|
11.6
|
%
|
—
|
%
|
|
$
|
99.9
|
|
$
|
—
|
|
*
|
|
10.0
|
%
|
—
|
%
|
Operating expenses
|
41.1
|
|
—
|
|
*
|
|
6.4
|
%
|
—
|
%
|
|
54.4
|
|
—
|
|
*
|
|
5.5
|
%
|
—
|
%
|
||||
Operating income
|
$
|
33.3
|
|
$
|
—
|
|
*
|
|
5.2
|
%
|
—
|
%
|
|
$
|
45.5
|
|
$
|
—
|
|
*
|
|
4.5
|
%
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
EBITDA (1)
|
$
|
57.8
|
|
$
|
—
|
|
*
|
|
9.0
|
%
|
—
|
%
|
|
$
|
78.1
|
|
$
|
—
|
|
*
|
|
7.8
|
%
|
—
|
%
|
EBITDA margin (2)
|
77.7
|
%
|
*
|
*
|
|
*
|
*
|
|
78.2
|
%
|
*
|
*
|
|
*
|
*
|
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
|
|
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
||||||||||
Three Months Ended
June 30, |
Percent
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|
Percent
|
|
Six Months Ended
June 30, |
||||||||||||||||||||
2017
|
2016
|
Change
|
|
2017
|
2016
|
|
2017
|
|
2016
|
|
Change
|
|
2017
|
2016
|
|||||||||||||||
|
(in millions, except percentages)
|
||||||||||||||||||||||||||||
Revenues less cost of revenues
|
$
|
36.2
|
|
$
|
30.2
|
|
19.9
|
%
|
|
5.6
|
%
|
17.4
|
%
|
|
65.0
|
|
|
53.9
|
|
|
20.6
|
%
|
|
6.4
|
%
|
15.7
|
%
|
||
Operating expenses
|
2.8
|
|
3.7
|
|
(24.3
|
)%
|
|
0.3
|
%
|
2.1
|
%
|
|
5.7
|
|
|
7.2
|
|
|
(20.8
|
)%
|
|
0.6
|
%
|
2.1
|
%
|
||||
Operating income
|
$
|
33.4
|
|
$
|
26.5
|
|
26.0
|
%
|
|
5.2
|
%
|
15.3
|
%
|
|
$
|
59.3
|
|
|
$
|
46.7
|
|
|
27.0
|
%
|
|
5.9
|
%
|
13.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
EBITDA (1)
|
$
|
33.8
|
|
$
|
27.4
|
|
23.4
|
%
|
|
5.3
|
%
|
15.8
|
%
|
|
$
|
60.0
|
|
|
$
|
48.5
|
|
|
23.7
|
%
|
|
6.0
|
%
|
14.1
|
%
|
EBITDA margin (2)
|
93.4
|
%
|
90.7
|
%
|
*
|
|
*
|
*
|
|
92.3
|
%
|
|
90.0
|
%
|
|
*
|
|
*
|
*
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
||||||||||
|
Three Months Ended
June 30, |
Percent Change
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
Percent Change
|
|
Six Months Ended
June 30, |
|||||||||||||||||
2017
|
2016
|
|
2017
|
2016
|
|
2017
|
|
2016
|
|
2017
|
2016
|
|||||||||||||||
(in millions, except percentages)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Revenues less cost of revenues
|
$
|
18.5
|
|
$
|
—
|
|
*
|
|
2.9
|
%
|
—
|
%
|
|
$
|
24.6
|
|
|
$
|
—
|
|
*
|
|
2.5
|
%
|
—
|
%
|
Operating expenses
|
15.0
|
|
—
|
|
*
|
|
2.3
|
%
|
—
|
%
|
|
19.5
|
|
|
—
|
|
*
|
|
2.0
|
%
|
—
|
%
|
||||
Operating income
|
$
|
3.5
|
|
$
|
—
|
|
*
|
|
0.6
|
%
|
—
|
%
|
|
$
|
5.1
|
|
|
$
|
—
|
|
*
|
|
0.5
|
%
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
EBITDA (1)
|
$
|
11.0
|
|
$
|
—
|
|
*
|
|
1.7
|
%
|
—
|
%
|
|
$
|
15.1
|
|
|
$
|
—
|
|
*
|
|
1.5
|
%
|
—
|
%
|
EBITDA margin (2)
|
59.5
|
%
|
*
|
*
|
|
*
|
*
|
|
61.4
|
%
|
|
*
|
*
|
|
*
|
*
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
|
|
|
|
|
|
|
Percentage of Total Revenues
|
||||||||||
|
Three Months Ended
June 30, |
Percent Change
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
Percent
|
|
Six Months Ended
June 30, |
||||||||||||||||
2017
|
2016
|
|
2017
|
2016
|
|
2017
|
2016
|
Change
|
|
2017
|
2016
|
||||||||||||||
|
(in millions, except percentages)
|
||||||||||||||||||||||||
Revenues less cost of revenues
|
$
|
10.9
|
|
$
|
—
|
|
*
|
|
1.7
|
%
|
—
|
%
|
|
$
|
14.9
|
|
$
|
—
|
|
*
|
|
1.5
|
%
|
—
|
%
|
Operating expenses
|
15.0
|
|
—
|
|
*
|
|
2.3
|
%
|
—
|
%
|
|
20.2
|
|
—
|
|
*
|
|
2.0
|
%
|
—
|
%
|
||||
Operating (loss) income
|
$
|
(4.1
|
)
|
$
|
—
|
|
*
|
|
(0.6
|
)%
|
—
|
%
|
|
$
|
(5.3
|
)
|
$
|
—
|
|
*
|
|
(0.5
|
)%
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
EBITDA (1)
|
$
|
5.0
|
|
$
|
—
|
|
*
|
|
0.8
|
%
|
—
|
%
|
|
$
|
6.8
|
|
$
|
—
|
|
*
|
|
0.7
|
%
|
—
|
%
|
EBITDA margin (2)
|
45.9
|
%
|
*
|
*
|
|
*
|
*
|
|
45.6
|
%
|
*
|
*
|
|
*
|
*
|
|
|
Six Months Ended
June 30, |
||||||
|
2017
|
|
2016
|
|||||
Net cash provided by operating activities
|
|
$
|
172.1
|
|
|
$
|
114.9
|
|
Net cash used in investing activities
|
|
(1,467.4
|
)
|
|
(63.9
|
)
|
||
Net cash provided by (used in) financing activities
|
|
1,346.5
|
|
|
(101.1
|
)
|
||
Effect of foreign currency exchange rate changes on cash and cash equivalents
|
|
0.1
|
|
|
—
|
|
||
|
|
$
|
51.3
|
|
|
$
|
(50.1
|
)
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
Cash and cash equivalents
|
$
|
148.6
|
|
|
$
|
97.3
|
|
Financial investments
|
110.4
|
|
|
—
|
|
||
Cash collected for Section 31 fees
|
(110.0
|
)
|
|
—
|
|
||
Adjusted cash (1)
|
$
|
149.0
|
|
|
$
|
97.3
|
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
Term Loan Agreement
|
$
|
475.0
|
|
|
$
|
—
|
|
3.650% Senior Notes
|
650.0
|
|
|
—
|
|
||
1.950% Senior Notes
|
300.0
|
|
|
—
|
|
||
Revolving Credit Agreement
|
—
|
|
|
—
|
|
||
Less unamortized discount and debt issuance costs
|
(13.7
|
)
|
|
—
|
|
||
Total long-term debt
|
$
|
1,411.3
|
|
|
$
|
—
|
|
|
Three Months Ended
June 30, 2017 |
|
Six Months Ended
June 30, 2016 |
||||||||||||
Euro(1)
|
|
British Pound (1)
|
|
Euro(1)
|
|
British Pound (1)
|
|||||||||
Foreign denominated % of:
|
|
|
|
|
|
|
|
||||||||
Revenues
|
1.9
|
%
|
|
1.6
|
%
|
|
1.6
|
%
|
|
1.5
|
%
|
||||
Cost of revenues
|
1.6
|
%
|
|
—
|
%
|
|
1.5
|
%
|
|
—
|
%
|
||||
Operating expenses
|
0.4
|
%
|
|
—
|
%
|
|
0.2
|
%
|
|
—
|
%
|
||||
Impact of 10% adverse currency fluctuation on:
|
|
|
|
|
|
|
|
||||||||
Revenues
|
$
|
1.0
|
|
|
$
|
0.9
|
|
|
$
|
1.6
|
|
|
$
|
1.5
|
|
Cost of revenues
|
0.5
|
|
|
—
|
|
|
0.7
|
|
|
—
|
|
||||
Operating expenses
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
British Pound (1)
|
||
|
(in millions)
|
||
Net equity investment in Bats Europe
|
$
|
676.2
|
|
Impact on consolidated equity of a 10% adverse currency fluctuation
|
$
|
67.6
|
|
|
|
CBOE HOLDINGS, INC.
|
|
|
|
Registrant
|
|
|
|
|
|
|
|
By:
|
/s/ Edward T. Tilly
|
|
|
|
Edward T. Tilly
|
|
|
|
Chief Executive Officer (Principal Executive Officer)
|
Date:
|
August 4, 2017
|
|
|
|
|
|
|
|
|
By:
|
/s/ Alan J. Dean
|
|
|
|
Alan J. Dean
|
|
|
|
Executive Vice President and Chief Financial Officer (Principal Financial Officer)
|
Date:
|
August 4, 2017
|
|
|
Exhibit No.
|
|
Description
|
10.1
|
|
Form of Amended and Restated Director Indemnification Agreement (Filed herewith).
|
|
|
|
12.1
|
|
Ratio of Earnings to Fixed Charges (Filed herewith).
|
|
|
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Rule 13a-14 (Filed herewith).
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Rule 13a-14 (Filed herewith).
|
|
|
|
32.1
|
|
Certificate of Chief Executive Officer pursuant to Rule 13a-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (Filed herewith).
|
|
|
|
32.2
|
|
Certificate of Chief Financial Officer pursuant to Rule 13a-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (Filed herewith).
|
|
|
|
101.INS
|
|
XBRL Instance Document (Filed herewith).
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document (Filed herewith).
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document (Filed herewith).
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase (Filed herewith).
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document (Filed herewith).
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document (Filed herewith).
|
|
Six Months Ended June 30,
|
Year Ended December 31,
|
||||||||||||||||
|
||||||||||||||||||
|
||||||||||||||||||
(in millions, except ratios)
|
2017
|
2016
|
2015
|
2014
|
2013
|
2012
|
||||||||||||
Earnings:
|
|
|
|
|
|
|
||||||||||||
Income before taxes
|
$
|
123.7
|
|
$
|
305.4
|
|
$
|
323.2
|
|
$
|
310.9
|
|
$
|
285.6
|
|
$
|
244.3
|
|
Fixed charges:
|
|
|
|
|
|
|
||||||||||||
Interest expensed and capitalized and amortized premiums, discounts
|
21.1
|
|
5.7
|
|
—
|
|
—
|
|
—
|
|
—
|
|
||||||
An estimate of interest expense within rental expense
|
1.4
|
|
1.5
|
|
1.4
|
|
1.3
|
|
1.0
|
|
1.1
|
|
||||||
Distributed income of equity investees
|
1.5
|
|
2.9
|
|
2.4
|
|
—
|
|
—
|
|
—
|
|
||||||
Total fixed charges
|
$
|
24.0
|
|
$
|
10.1
|
|
$
|
3.8
|
|
$
|
1.3
|
|
$
|
1.0
|
|
$
|
1.1
|
|
|
|
|
|
|
|
|
||||||||||||
Total earnings including fixed charges
|
$
|
147.7
|
|
$
|
315.6
|
|
$
|
327.0
|
|
$
|
312.2
|
|
$
|
286.6
|
|
$
|
245.4
|
|
|
|
|
|
|
|
|
||||||||||||
Ratio of earnings to fixed charges (1)
|
6.6x
|
|
43.7x
|
|
231.4x
|
|
245.7x
|
|
286.9x
|
|
213.6x
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
Dated:
|
August 4, 2017
|
|
/s/ Edward T. Tilly
|
|
|
|
Edward T. Tilly
|
|
|
|
Chief Executive Officer
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
Dated:
|
August 4, 2017
|
|
/s/ Alan J. Dean
|
|
|
|
Alan J. Dean
|
|
|
|
Executive Vice President and Chief Financial Officer
|
/s/ Edward T. Tilly
|
|
|
Edward T. Tilly
|
|
|
August 4, 2017
|
|
|
/s/ Alan J. Dean
|
|
|
Alan J. Dean
|
|
|
August 4, 2017
|
|
|