CME Group (CME) Earnings Report: Q1 2016 ... - s.t.st · CME Group (CME) Earnings Report: Q1 2016 Conference Call Transcript The following CME Group conference call took place on

CompanyName:CMEGroupIncCompanyTicker:CMESector:FinancialIndustry:FinancialServices

EventDescription:Q12016EarningsCallMarketCapasofEventDate:31.85BPriceasofEventDate:92.59

©2014TheStreet,Inc.Al l R ightsReserved Page1of16

CMEGroup(CME)EarningsReport:Q12016ConferenceCallTranscriptThefollowingCMEGroupconferencecalltookplaceonApril28,2016,08:30AMET.Thisisatranscriptofthatearningscall:

CompanyPart icipants

JohnPeschier;CMEGroup;InvestorRelationsPhupinderGill;CMEGroup;CEOJohnPietrowicz;CMEGroup;CFOSeanTully;CMEGroup;SeniorManagingDirector,Financial&OTCKimTaylor;CMEGroup;President,GlobalOperations,Technology&RiskDerekSammann;CMEGroup;SeniorManagingDirector,Commodities&OptionsProductsBryanDurkin;CMEGroup;CCO

OtherPart icipants

DanFannon;JefferiesLLC;AnalystRichardRepetto;SandlerO 'Neill&Partners;AnalystKenWorthington;JPMorgan;AnalystSameerMurukutla;BoAMerrillLynch;AnalystAlexKramm;UBS;AnalystAlexBlostein;GoldmanSachs;AnalystBrianBedell;DeutscheBank;AnalystChrisHarris;WellsFargoSecurities;AnalystKenHill;BarclaysCapital;AnalystKyleVoigt;Keefe,Bruyette&Woods;AnalystRobRutschow;CLSALimited;AnalystPatrickO'Shaughnessy;RaymondJames&Associates;Analyst

MANAGEMENTDISCUSSIONSECTION

Operator :

GooddayandwelcometotheCMEGroupfirstquarter2016earningscall.

IwouldliketoturntheconferenceovertoJohnPeschier.Pleasegoahead.

JohnPeschier (InvestorRelations):

Thankyouforjoiningusthismorning.

GillandJohnwillspendafewminutesdiscussingtheresultsandthenwewillopenupthecallforyourquestions.Terry,Bryan,Derek,SeanandKimareonthecallaswellandwillparticipateintheQ&Asession.

Beforetheybegin,IwillreadtheSafeHarborlanguage.

Statementsmadeonthiscallandintheslidesonourwebsitethatarenothistoricalfactsareforward-lookingstatements.Thesestatementsarenotguaranteesoffutureperformanceandinvolverisks,




uncertaintiesandassumptionsthataredifficulttopredict.Therefore,actualoutcomesandresultsmaydiffermateriallyfromwhatisexpressedorimpliedinanyforward-lookingstatements.

MoredetailedinformationaboutfactorsthatmayaffectourperformancemaybefoundinourfilingswiththeSECwhichareavailableonourwebsite.

Withthat,IwouldliketoturnthecallovertoGill.

PhupinderGill(CEO):

Thankyou,Mr.Peschier.Thankyouallforjoiningus.Itisanexceptionalstarttotheyearwithrecordquarterlyaveragedailyvolume,whichisup13%comparedwithanalreadystrongfirstquarterlastyear.Wehadverybalancedgrowthinbothfinancialandcommodityproducts,eachupdoubledigits.

WetrackcustomersegmentactivitycloselyandinQ1wehadmorethan10%growthfromassetmanagers,hedgefunds,corporates,proprietarytradingfundsandretailclientsduringthequarter.Volumefrombankswasup1%whichisstrongrelativetothedecreaseintheoveralltradingbusinessesovereachofthelastfewyears.

MorerecentlyAprilactivityhasbeenfairlystrongcomparedtolastyearandisupmorethan20%intotal.ItisencouragingtoseerelativelygoodvolumesasAprilhasbeenourslowestmonthoverthelasttwoyears.Openinterestremainselevatedandisupsignificantlysincethebeginningoftheyear.

ThismorningIwillstartwithourseculardriversandthenIwillshifttoafewproducthighlights.Wehaveconsistentlyexpandedourglobalparticipationinspiteofthechallengingmacroenvironment.WeareverypleasedwiththetremendousresultsfromoutsideoftheUSduringthefirstquarter.

Wehadrecordquarterlynon-USvolumebyfaraswellasthehighestproportionofthebusinessfromoutsideoftheUSsincewestartedtrackingtheinformationwithmorethan25%inthefirstquartercomparedto23%inthefirstquarteroflastyear.

InEurope,wehadaverystrongfirstquarteractivitywithvolumeincreasing28%from2.3millioncontractsperdaylastyeartomorethan2.9millionperdaythisyear.Theincreaseisledbyequities--whichjumped70%;andenergywasupalmost60%.InAsia,energywasup75%andequitiesgrewbyabout70%withmetalsrisingmorethan30%.

FocusingonAsiaforamoment,wehavebeendiscussingtheopportunitytoexpandouruserbasetoincludeChinesefirmsandentitiesformanyyears.Ourfocusstartedprimarilywithintermediariesandwearenowengagingdirectlywithassetmanagers,hedgefundsandotherentitiesthere.

WegenerallylookatourtradingdataintermsofwhatweseethroughMainlandChina,HongKongandTaiwan.InQ1,wereachedapproximately200,000contractsperdaycombined,whichisupfrom100,000contractsperdayinQ1of2014and125,000contractslastyear.

OurmostnotablerecentsuccessisinourenergyfranchisewherewehaveseenMainlandChinaaveragedailyvolumeincreasefromlessthan10,000contractsinthemiddleoflastyeartomorethan30,000contractsinQ1.AhighlightfromHongKongactivityisinourequitybusinesswithaveragedailyvolumetheremorethandoublingtoalmost25,000contractsperdayinQ1.Thesurgeinvolumeisgreattoseeandweareveryfortunatetohavehighlyappealingproductstooffertheseclients.

BasedonthechallengesinChinaoverthelastyear,webelievemanyofthesefirmsarecomfortabletradinginourregulatedmarketsandbenefitingfromthesignificantliquiditywehavearoundtheclock.

Speakingofthat,inadditiontothecountryorigininformationwesharewithyou,wealsotrackelectronic




volumethroughoutthe24-hourtradingday.InQ1,volumeduringAsianhoursgrewbyalmost30%whileactivityduringEuropeanhoursrose60%.Liquiditybegetsliquidityandwearedisplayingdeeperelectronicmarketsinbothfuturesandmorerecentlyoptionsaroundtheclock.

Turningtooureffortsinoptions,weremainastrongleadercomparedtootherglobalexchangeswithQ1optionsvolumehittingarecord3.5millioncontractsperdaywhichisup22%withelectronicoptionsaveragedailyvolumerising26%toarecord1.8millioncontracts.ThecontinuedelectronificationofouroptionsfranchisehasenabledustofurtherglobalizeparticipationinouroptionsmarketswithourEuropeanoptionsvolumeup36%andAsianoptionsvolumesup25%inQ1.

Ourcontinuedinvestmentinsystemsenhancements,newproductsandclienteducationaredrivingsignificantlyincreasedusageofouroptionsproductsfromenduserswithvolumesfromhedgefundsandassetmanagersup34%andup29%respectively.

AcoupleofquickpointsandIwillfinishincommodityproducts.Startingwithinterestrates,volumerose9%tomorethan8millioncontractsadayandrevenueincreasedby14%withEurodollarsleadingtheway.WehitrecordlevelsofopeninterestinQ1inourratesbusinessdrivenbyEurodollaroptionsandtreasuryfutureswhichhitall-timehighs.WealsohadverystrongoptionsactivitywiththehighestquarterlyvolumeeverandreachedarecordpercentageoftheoptionstradingonGlobexinMarchwith71%electronicintreasuriesand25%electronicinEurodollars.SofarinApril,theelectronicpercentageinEurodollaroptionshasgrownto27%.

Ontheproductdevelopmentfront,wementionedourlaunchoftheUltra10-yearcontractonourlastearningscall.Thisproducthascontinuedtogainmomentumandhasattractedattentionwithseveralarticleswrittenoverthelastmonthrelatedtothisinnovativenewproduct.Inaddition,wearepleasedthatweclearedourfirstswaptionstradeearlierthismonthandwethinkthisisyetanotherexampleofinnovatingandbeingfirsttomarketwithacustomer-ledsolution.

Wehelda(swap-options)customerwebinarthatattractedover500participantswithsignificantfollow-updiscussionsandwehadanumberofproductiveclienteventsrelatedtotheproduct.OurdollarrateswapsmarketsharereachedthehighestlevelinMarchthatwehaveseenoverthelastsixmonthsandwehada15%pickupinrevenuecaptureinswapsclearingversusQ4lastyear.

Lastly,weareactivelyinvolvedwithaworkinggroupofintermediariesandcustomersonapotentialrepoclearingoffering.Ifthatdevelopsoverthenextquarters,wewillshareadditionalinformation.

Turningtoequities,wearepleasedwiththestartoftheyearwithQ1volumeup28%andAprilupmorethan30%.Wehavehadsolidactivityinequityoptionswhichgrew20%duringthequarter.InQ1,ourS&P500optionsmarketshareversusCBOEexpandedto29.4%from27.8%lastyear.Openinterestinequityoptionsrose13%comparedtotheprioryearandournewBTICordertypecontinuestoperformwellandtradeat20,000contractsforthefirsttimeonMarch31.

Movingontoourcommoditiesportfolio,thesebusinesslinesoverallwereup13%.EnergyhasbeenparticularlystrongwithrecordQ1averagedailyvolumeof2.5millioncontractsandAprilhascontinuedtoberobustwithvolumesupalmost40%.WTIfutureshadarecordquarteraveragingabout1.2millioncontractsperdayandgasolinefuturesactivitywasalsoatarecordlevel.

Imentionedoptionsearlierandwithinenergy,wehadrecordWTIoptionsvolumeofover200,000contractsperdayandmorethan145,000contractsperdayonGlobex.Ournaturalgasoptionswereup38%duringthequarterandwehadarecordpercentageofvolumetradedelectronicallythere.Additionally,wesetarecordnumberoflargeopeninterestholdersinourenergyfuturesinQ1.

Ourmetalsbusinesswasalsoastandoutinthefirstquarterwithvolumesup23%.Ourpreciousmetals




averagedailyvolumewasup26%ledbyoptionswhichrose36%inQ1.Asmanyofyouknow,wehavemadesignificantinroadsintobaseandferrousmetalsbusinessesandwecontinuetoexpandourpresenceinthesekeygrowthareas.

Ourcopperbusinessisup11%andwehitanewopeninterestrecordduringQ1.Wecontinuetooutperformourprimarycompetitorinthismarketwherewehavepostedfastergrowthincopperineachofthelastfivequarters.

Inaluminum,wecontinuetoexpandoursuiteofaluminumofferingsachievingrecordvolumesandincreasingouropeninterestfivefoldinthelast12months.Andinironore,leveragingourcustomervaluepropositionofglobalelectronictradingoffuturesandoptionsandcustomeranonymity,wehavehadgrowingopeninterestandarecordtradingdayofalmost13,000contracts.Wehavenowachievedironoremarketshareof10%inQ1,upfromjust3%in2015aswecontinuetosuccessfullyexpandanddiversifyourglobalsuiteofmetalsproducts.

Finally,agriculturalproductshavebeenparticularlystronginAprilandaretrackingtowardamonthlyaveragedailyvolumerecordforthemonthafteraslowstarttotheyear.TradinghastakenoffbasedonproductionuncertaintyinSouthAmericawherewetconditionsinArgentinaanddryconditionsinBrazilarecausingconcerns.Wehadtwoconsecutiverecordtradingdayslastweekintheoverallcomplexwithalmost3millioncontractsincludingrecordsoybeanproductvolumeabove1.5millioncontractsononeofthosedays.

Electronicagoptionsaresurgingupfromnear130,000inAprillastyeartomorethan250,000dailysofarthisApril.Importantly,openinterestinsoybeanandcornfuturesareup16%and8%respectivelyfromlastyear.Finally,lastweekwereachedanall-timehighinlargeopeninterestholdersinagriculturalproducts.

Insummary,wecontinuetoworkwithourcustomersonbringinginnovativeriskmanagementsolutionstothemarketplaceandourproductdiversityisunparalleled.Johnwilltouchonourprogresstocontinuetostreamlineourinfrastructurecosts,toreallocateourexpensestogrowthinitiativesandtofurtherinnovateinourbusinesses.

Withthat,IamgoingtoturnthecallovertoJohntodiscussthefinancials.Thankyou.

JohnPietrowicz (CFO):

Thankyou,Gill.Goodmorning,everyone.

Ourteamhasbeenintenselyfocusedonthreethings,drivingglobalrevenuegrowth,operatingourbusinessasefficientlyaswecan,andreturningexcesscapitaltoourshareholdersinaconsistentway.AsGillmentioned,wehadatremendousstarttotheyearwithstrongandbalancedrevenuegrowth.Totalrevenuewasup11%comparedtoaverystrongquarterlastyearwhiletotaladjustedexpenserosejust3%.Ouradjustedoperatingmarginexpandedto65%andadjustedEPSof$1.15wasup17%.

Ourratepercontractforthefirstquarterwas$0.756,down4%from$0.789inQ4asouroverallADVrose29%sequentially.Thebiggestimpactswerememberversusnonmembermixandvolumediscounttiersthisquarterduetothelargeincreaseinactivity.

Comparedtothefourthquarter,ourmembersvolumegrew30%andnonmembersjumped23%.Inaddition,wehadhighervolumediscountsinQ1relativetoQ4asaresultofsignificantgrowthincertainproducts.

Marketdatarevenuewasup4.5%comparedtoQ1lastyearandinlinewithourguidance.Wecontinuetomonitorthislinecarefullyasweareseeingsomerationalizationaswebringallcustomersinlinewith




thefullpriceofferingandweareseeingsomescreendeclinesduetorecentbankstaffreductions.

Adjustedoperatingexpensesforthequartertotaled$327million,up3%drivenprimarilybyan$8millionincreaseinlicensingandotherfeeagreements.Excludinglicensefees,ourtotalexpenseyear-over-yearwasapproximatelyflatandasareminder,ourannualguidancewasa1%increaseonthatbasis.

Weendedthequarterwithapproximately2600employeeswiththemajorityofthehiringdoneinIndiaandBelfastwhichispartofourplantoreducetechnologyexpensewhileimprovingservicebystaffinginthoselower-costlocationsandreducingcontractors.OurcompensationratioforQ1cameinat14.1%comparedto16.1%forthefull-yearof2015.

Lookingatthenonoperatingincomeandexpenseline,ourownershipintheS&PDowJonesjointventuredrovemorethan$26millioninnetearningsfromunconsolidatedsubsidiarieswhichwasup13%fromtheprioryear.WearepleasedwiththeinvestmentwemadeintheIndexbusinesswhilealsoassuringwecontinuetooffertheworld'sleadingIndexfuturesproductsonCME.

Nowturningtoinvestmentincome,wehadameaningfulincreaseininvestmentincomedrivenalmostentirelybythereturnsgeneratedthroughreinvestmentofcashperformancebondsandguarantyfundcontributions.

Theriseinshort-termratesattheendoftheyearresultedinanincreaseininvestmentincomeof$17million.DuringQ1,wehadreturnedapproximately$10millionofthattoclearingfirms,whichisdisplayedontheincomestatementunderothernon-operatingexpense.Thisamountisanticipatedtoincreaseasourinvestmentreturnsgrow.

WerecentlyreceivedapprovaltoestablishanaccountdirectlyattheFed.Atthispointtheaccountwillonlybeforclearingfirmhousepositionsheldincash.WearecurrentlyintheprocessofoperationalizingtheaccountswiththeFed.Wheneffective,weexpecttopassahigherratetoclearingmembersfortheirhousepositionsthanwedotoday.

CashheldinsegregatedcustomeraccountswillcontinuetobeinvestedthroughcommercialbanksandU.S.Treasurysecuritiesastheyarenow.Weexpectthatthehouseaccountswillbeoperationalinthenextmonthorsoasinthepastweplantocontinuetopassthroughthemajorityoftheearningsbacktotheclearingmembers.

Turningtotaxes,forthequarterweendedat36.3%,slightlybelowourguidance.

Andnowtothebalancesheet.DuringQ1,wepaidalmost$1.2billionindividendstoshareholdersincludingourvariabledividendandthefirstregulardividend.Attheendofthefirstquarter,wehad$1.33billionincash,restrictedcashandmarketablesecurities.Weadded$130millionduringthequarterdrivenbythesale-leasebacktransactionofourdatacenterwithCyrusOne.

Duringthefirstquarter,capitalexpendituresnetofleaseholdimprovementallowanceswere$16millionaswecontinuetoleveragemoresoftwareandinfrastructureasaservicewhichisincludedinexpense.

Wecontinueourintensefocusonefficiency,withthesaleofourofficebuildingsoverthelastfewyearsandmorerecentlyourdatacenter,wearetakinganassetlightapproachwhichwillallowwastofocusonrunningourcorebusiness.I

n2015,wede-layeredthemanagementstructure,closedfuturespits,reducedmarketingcostandfocusedondatacenterconsolidation.Sofarthisyearwehavecompletedthesaleofourdatacenter,subletexcessofficespaceinChicago,announcedtheclosureofourtradingfloorsinNewYorkatyear-endandhavebeguntooffshoresomepositionsreducingcompensationandconsultingcosts.




Withthesaleandleasebackofourdatacenter,wewillcontinuetooperateourtradingandclearingfunctionsaswellasourco-locationbusinessandwewillcontinuetoreceivethecorrespondingco-locationrevenue.Fromanearningsperspective,thistransactionisapproximatelyneutral.

Intermsofexpenses,wewillseeanetreductionintotalquarterlyexpenseofabout$1millionprimarilyindepreciationandweexpectacorrespondingincreaseunderinterestexpense.

TurningtotheNewYorkfloor,wewillsaveapproximately$5millionofexpenseannuallybeginningin2017andpossiblyanother$3millionperyearifwecansuccessfullysubleasethespace.

Insummary,Iamverypleasedwiththehardworkthisquarteracrosstheentirebusiness.Asyouknow,operatingleverageinourbusinessissignificantandthiswasclearlyevidencedbythemarginonincrementalrevenueofapproximately90%.

Wehaveoutlinedmanypositivesgoingforwardincludingbuildingliquidityaroundtheclockandfromaroundtheworld,innovatingnewproducts,gettingaccesstotheFedaccountswhichshouldbenefitbothourintermediariesandourshareholders,andcontinuingtofocusonourefficiencystrategy.

Withthat,wewouldliketoopenupthecallforyourquestions.Giventhenumberofanalystswhocoverus,weaskthatyoulimityourselftoonequestionsowecangettoeveryone.

Pleasefeelfreetogetbackintothequeueifyouhaveanyfurtherquestions.Thankyou.

QUESTIONS&ANSWERS

Operator :

(OperatorInstructions)

DanFannon,Jefferies.

DanFannon (Analyst-JefferiesLLC):

Thanks.Goodmorning.SinceyourlastcalltherehasbeenalotofheadlinesaroundM&AorpotentialM&Ainyourindustry.

Gill,ifyoucouldupdateusonyourthoughtsaroundyourviewsaroundM&A,bothlarge-scaleaswellasstrategic?

Andthen,John,alsomaybetalkaboutthefinancialaspectsasyouguysthinkaboutreturnthresholdsaroundpotentialacquisitions?

PhupinderGill(CEO):

Dan,Ithinkthestoryisconsistentwithwhatwehavespokentoyouaboutinthepast.WewillcontinueourfocusonourglobalizationontheoptionsgrowthIhadtalkedalittlebitaboutashortwhileago.AndaswellaswhatwearenowcallingcapitalefficiencieswhichisacombinationofabunchofthingswhichisessentiallywhetherwearetalkingaboutclearingofOTCtrades,thefuturizationofthemarketplace,brandnewclientsorthecrossmarginingandthecompressionservicesthatweoffer.

Andwiththatfocusthatwehavewecontinuetoremainopportunisticwithrespecttoanykindofopportunitiesthatwemightseethatmakesenseforbothourselves,ourshareholdersaswellasourclients.





Dan,thisisJohnjumpingin.Wewillgetbothorganicandinorganicgrowthopportunitiesallthetimeandreallyitisaboutcreatingshareholdervalueinthebestwaypossible.Sowelookatacquisitionsinparticular.Welookatitfromobviouslymultiplevaluationmetrics,isitaccretiveovertimetoearnings?Doesitcreatevaluebylookingatcashflowmodels?Sowhenwelookatreturnthresholds,weusuallyuseabout9%to10%askindofthethresholdthatwelookat.

ButIthinkforusitisarewecreatingshareholdervalue,howisthebestwaytogetfromastrategicperspectivetowherewewanttobe?Isitgrowingthebusinessorganically,investingthebusinessorganicallyorisitpurchasinggoodservicesoranothercompanyfromsomebodyelse?Sothatiswhatwewouldlookat.

DanFannon (Analyst-JefferiesLLC):

Thankyou.

Operator :

RichardRepetto,SandlerO 'Neill.

RichardRepetto (Analyst-SandlerO 'Neill&Partners):

Goodmorning,guys.Somyquestionisonexpenses.Youarerunningsignificantlybelowthefull-yearguidancelikewecomeoutwith1.15andtheguidanceIbelieveis1.18.Andthiswasahighrevenuequarter,yougothighpayrolltaxes.Theotherthingtogoalongwiththat,youarerunningsignificantlybelowonCapExaswell,thefull-yearrunrate.SoI'mjusttryingtoseewhattheexpenseguide,whetherit'smaintainedandifitismaintained,whatcouldwebespendingstuffoninthebackthreequarters?


Thanks,Rich.ExpensecontrolandrunningourbusinessasefficientlyaspossibleisaverybigfocusoftheentiremanagementteamandithasreallybecomepartofourDNA.Whenwelookattheexpenses,thefirstquartertendstobeaslowerquarterintermsofexpensesaswebuildupandprojectsgetlaunchedinthesecondandthirdquarters.Butifyoulookatslide14,youcanseetheresultsofourfocusonexpenses.Youcanseethatovertimewehavehadexpandingoperatingmarginsandwe'vegotincrementalmarginslastyearof112%and90%incrementalmarginsthisquarterandoperatingmarginsaround65%.

Soithasbeenalargefocusofours.Intermsoftheguidance,wehaveguidedtoaverymodest1%increaseinexpensesex-licensefees.Wearenotadjustingguidanceatthistimebutweareintenselyfocusedonthebusinessandrunningthebusinessasefficientlyaspossible.

WhatthisdoesisthisallowsustofreeupcostsforgrowthinitiativesandsomeofthegrowthinitiativesGilloutlinedinhispreparedremarksandforexampleswaptionsissomethingthatwewillbelaunchingthatmaybeSeancancommentonasanexampleofwhatweareworkingon.

SeanT ully(SeniorManagingDirector,Financial&OTC):

Yes,sure.IntermsofourOTCclearing,whichGilltalkedaboutintermsofofferingcapitalandmarginefficienciestothemarketplace,weactuallywerecentlylaunchedBRL,interestrateswapclearingwhichisauniquevaluepropositionrelativetoourlargecompetitor.Mexicanpeso,welaunchedalittleoverayearago,itisdoingextremelywell.Wedidhaveourfirstswaptionstradeveryrecently.Weareveryexcitedabouthowthatwilldevelopoverthecomingtwoquarters.

Andinadditiontothat,weareworkingverycloselywiththemarketplaceonrepoclearingasGill




mentionedinhisremarks.Sowearetalkingtoandworkingcloselywiththesamesetoffolksthatweworkedwithinordertolaunchoursuccessfulinterestrateswapclearinginitiativeandwearelookingatreplicatingthatwithsolvingalotofthemarketplacesissuesintherepoparticularlyinthetreasuryrepomarketsimilarly.


So,Rich,Imeanwearefocusedonexpensemanagement,wearefocusedonreducinginfrastructurecostsandfreeingupthosecoststoinvestinnewinitiativeslikeSeanjustmentioned.

Operator :

KenWorthington,JPMorgan.

KenWorthington (Analyst-JPMorgan):

Goodmorning.IntermsofyouruseoftheFedforhousepositions,howmuchmoneycangetplacedwiththeFedundertheexistingstructurethatyoujustgotsetupwiththeapproval?Towhatextentcanyoumovebeyondthisforjusthousepositionsinthefuture?

Andthenyoumentionedthepassingofthemajorityincomebacktoclients.TowhatextentdoesthisgiveCMEanopportunitytokeepmoreaswell?I'msureyouwon'tanswerbutIwillaskitanyway.Ifso,howmuch?


Thanks,Ken.Wehavebeenveryfocusedondrivingourinvestmentincomeline.Infact,ifyoutakealooksince2012inthefirstquarterof2012,weactuallyhadan$18millionexpenseinnonoperatingincomeandnowwehavedriventhattoa$5millionincomeonthatline.Sooverallwhenyoulookattheearningsthatwegotformanagingcollateral,weearnedapproximately$7millionthisquarterthroughinvestingthatcollateralwhichisaboutdoublelastquarter.Itwasdrivenprimarilybytheincreaseininterestrates.

AccesstotheFedaccountswillbeforhousepositionsheldincashsototheextentthatthatcashbalanceincreasesthereisanopportunityforustoearnmoreandwewillbeabletoprovidemorecoloronhowmuchisaboutthatimpactnextquarterwhentheFedaccountsbecomeoperational.Buttogiveyouanidea,about20%ofour$138billionincollateralishouseaccountrelated.MaybeKimcouldcommentontheFedaccount.

PhupinderGill(CEO):

Thecashcomponentofthat20%islower,thatisthepartthatwe[can],Ithink,Kim,itis$3billion?

KimT aylor (President,GlobalOperations,Technology&Risk):

Currentlythecashbalancesonthehousepositionsis$3billion.Thatisnotanumberthatwecontrol,itisanumberthattheclearingmemberscontrolwiththedecisionsthattheymakeaboutwhattheypostformargin.Butobviouslythereturnthattheygetonthefundsthattheypostwithusispartofthatdecision.

PhupinderGill(CEO):

Anditisahigherreturnforourclientbaseandoneoftheexcitingthingsabouthavingthisaccountforus.





Andthenyouaskedaboutthecustomeraccounts.Thoseareauthorized.Thatprocessisunderwaybetweentheregulators.Thatisnotsomethingthatwecanreallycommentonthetimingofbutweknowthatitisstillbeingworkedon.

Operator :

MikeCarrier,BankofAmerica.

SameerMurukutla(Analyst-BoAMerrillLynch):

Goodmorning.ThisisactuallySameerMurukutlaonforMikecarrier.Thanksfortakingmyquestion.Goodmorning.IamgoingtojustleverageoffofDan'squestionabit.CanyouprovideanupdateonyourthoughtsintothelevelofyourstakeinBM&FgiventheircurrentM&Athattheyareinvolvedin?AndanycommentsonthepossibleinterestintheIndianCommodityExchange?Thanks.


Sure,thisisJohn.BVMFisoneofourmostimportantinternationalstrategicrelationshipsregardlessofanyownershipstakes.Wecontinuetoholdabouta4%stakeinBVMF,thevalueofwhichhasincreasedover$150millionsincetheendof2015andwewillcontinuetoworkwiththemaswehavehistorically.

IntermsoftheIndianExchange,wearenotgoingtocommentonanyoftherumorsorM&Aactivitythere.

SameerMurukutla(Analyst-BoAMerrillLynch):

Okay,thanksfortakingmyquestion.

Operator :

AlexKramm,UBS

AlexKramm(Analyst-UBS):

Goodmorning.Wantedtojusttouchontheenergybusinessforasecondhere.ClearlyoneofthemoreimpressiveareasintermsofgrowthbutoneofthethingsthathasalwaysbeenorthathasbeenstandingoutisthatyouareoutperformingatleastintermsofADV,yourprimarycompetitor.Sowouldloveforyoutotalkalittlebitaboutwhatisgoingonthere.AndobviouslyyouallhavedifferentproductmixsomaybeifyoucandrillalittlebitdeepernotjustaboutbrandsbutalsoaboutWTI,naturalgas,gasoil,otherareaswhereyouarecompetingmoreorlessdirectly,whereyouarewinningandwhyyouarewinningifyouarewinning?

DerekSammann (SeniorManagingDirector,Commodities&OptionsProducts):

Yes,itisDerekhere.Iwouldsayweareabsolutelypleasedbutnottotallysatisfiedwiththegrowththatwecontinuetoimpacthereontheenergiesbusiness.ImeanwehavenotonlyhavewegrowntorecordlevelsinQ1,wehaveincreasedourlargeopeninterestholdersandithasbeenprettystronggrowth.WetalkedlastquarteraboutthebenefitsoftheoverallbroadmarketadoptionincreasinglytowardsWTIwiththeresultoftheliftingoftheexportbanintheUS.Thathasactuallysignificantlyincreasedparticipationinourmarketsonthefuturesaswellastheoptionside.

Butintermsofwherewe'regoingoutsideofthatoptionshasbeenasignificantareaofgrowthforusinsidetheenergiesbusinessandIwouldactuallyalsodirectyoutosomeofthecommentsthatGillmadeinhispreparedremarksaroundwhereandhowweareglobalizingourfootprintrightnow.




Ifyoulookatwherethegrowthofourbusinessiscomingfrom,ourEMEAbusinessforenergybusinessupabout40%.Thatisoutperformingthebusinessasawhole.Whatisreallyexcitingistheinvestmentsthatwehavemadeinbootsontheground,salescampaignsandproductsalesinAsiaforusisbearingsignificantfruit.OurAsianenergybusinessisup82%yearonyearandthatissignificantgrowthinalmosteverymajortradingcenter.

IwasinShanghaiandSingaporelastweekmeetingwithalotofourclientsandwecontinuetobeabletoattractthemwithourfunctionalitybothonthefuturesaswellastheoptionsideandthebroadbaseofparticipationinourmarkets.

SowetellalotoftheWTIstory,thereisanaturalgasstory,thereisagasolinestory.Wesetanall-timerecordinourgasolinefuturesaswellsoitisbroad-basedgrowth,itisglobalgrowthanditisacrossourassetclassinthepresenceofbuildingOIandlargeopeninterestholders.

Unidentif iedCompanyRepresentative :

IwouldjustaddtothatspecificallyontheinternationalsidewithinAsiaforexample,weareseeinggrowthcomingfromeachofourclientsegmentsintheenergyquadrant,propsareup31%.Banksinterestinglyenoughwereup104%,hedgefunds96%,corporatefirmscomingin88%,retail85%.WeareseeingsimilaractivitiescomingoutofEuropesoforexampleonthehedgefundandintheassetmanagementcommunity,26%growthspecificallyintheenergyquadrant.Soitgoestooursalespenetrationandeffortsinthatregardintermsofhowwearetargetingourfocusandourcampaignsintheseareas.

Operator :

AlexBlostein,GoldmanSachs.

AlexBlostein (Analyst-GoldmanSachs):

Thanks.Goodmorning.Justaquickfollow-uponmarketdata,Idon'tthinkitwasaskedyet,butthe4%to5%guidancefortheyearthatyouguysprovidedonthelastearningscall,doesthatstillholdorjustkindofgivensomeoftheheadwindsthatyouhighlightedontheheadcountreductions,shouldwethinkaboutaslowernumber,alowernumberfortheyear?


Whenweprovidedguidancelastyear,weprovidedarangebecauseitisverydifficulttopredict.Wehadgivenguidanceasa4%to5%growthrate.Wecameinthisquarterup4.5%fromQ1lastyearwhichisinlinewithourguidance.Weareseeingpressureascustomersmovetoourfullpricedofferingaswellasadeclineinscreencountsasbankslayoffstaffasyouhaveprobablyheardfromthebanksearningscalls.Soweareveryfocusedandworkinghardonourdatabusinessbutweareseeingsomeheadwindsasyouindicated.

Operator :

BrianBedell,DeutscheBank

BrianBedell(Analyst-DeutscheBank):

Goodmorning,folks.JusttopileonontheAsiaquestion,thanksforallthedisclosureonthat.Thatwasagooddiscussionyoujusthadaboutsomeoftheprogressthere.ButIguessifyoucanthinkaboutortrytohighlighthowbigyouthinkthismarketcaneventuallybeforCMEintermsofpenetrationrates?Obviouslythegrowthrecentlyhasbeenespeciallystrong.ButdoyouseethisasjustanADVperspective




beingabletobecomeaslargeasEuropelet'ssayinthenexttwoorthreeyears?Canyoutalkaboutsomeofthatpenetrationopportunity?Andthenalsorelatedto,John,Ithinkyoucitedmoreprojectsingrowthinitiativespendlaterintheyear.Ispartofthatincludedinthatspendinglevel?

PhupinderGill(CEO):

Brian,thisisGill.IamgoingtostartandIamgoingtoaskBriantobasicallyexpandmoreastowhereweareseeinggrowthspecifically.Ifyoulookattheproductopportunityset,ifyoulookattheopportunityintermsoftheproductthatwehaveacrossalloftheassetclassesthatwehave,wehavehighlyrelevantproductsforallofourclientsinallplacesaroundtheworld.WithinAsiaspecifically,wehavebeenfocusedoverthelastfewyearsonChinabutwhatwehavenottalkedaboutisthesaleseffortthatBrianwillgoalittlebitintootherpartsofAsiawhichIwouldsayaremoredevelopedintermsoftheeducationsideofthings.Koreacomestomind.

China,wehavegivenyousomenumbersthisquarterspecifictoChina.TheseareaccountsthatarebasedinChinabuttheymightbetrading,theyprobablywillbetradingfromoutsideofChina.AsChinacontinuestoexpanditspoliciesforaccess,youwouldseethatnumbergrow.Thetimingbehindthatremainstobeseen.Butaswesitherenow,Chinaisallowingandhasallowedtheirintermediariesaswellastheirdirectaccountssuchasthehedgefunds,thepropshopsandthecommercialentitiestoestablishoperationsoutsideofChinaandthatisthefloorthatweareseeing.

Indiaisanuntappedopportunityatthistime.ThereareverysignificantchangesafootinIndiathatwillalsolendthemselvesandtranslateintoopportunitiesforus.

SowiththatbroadviewaboutChinaandI'monlytalkingupoutareasinwhichwewillseethehighestimpact,IamgoingtoturnitovertoBryantotalkaboutsomeofthevolumeflowsthatweareseeingthataredrivingthehighrateofgrowththere.

BryanDurkin (CCO):

SowithrespecttotheeffortsinGreaterChinaandHongKongandspecificallyHongKong,weareseeingrevenuesareupabout51%,56%growthinourvolumethatisbeingdrivenfromenergyequitiesaswellassomeofourinterest-rateproducts.Withinthesegments,thegrowthisreallycomingfromprops,agrowingnumberofprivatehedgefundsandassetmanagershavealsoevolved.Weareworkingverycloselywithourintermediariestohelpbringthatbusinessintoourmarkets.Weareseeingsomegoodtractionintermsofliberalizationofthecentralstateownedenterprises.

Forexample,SOEswerepermissionedupuntilabouttwoyearsago,31.Nowitisabout112areinthatareasoweareseeingthatasadditionalopportunity.

Sovereignwealthfundsandassetmanagersareincreasinglygrowingtheirbusinesswithusandagain,wearefocusinginthatareaandreallybuildingonopportunitiestoworkwithcorporatesparticularlyinsurancecompanies.WeseemoreChinesebanksthatareinquiringabouttradingourproductsandalsolookingtobuildtheireffortsinquiringaboutOTCclearingwithuswhichisaverygoodsign.

WithinTaiwan,year-to-datevolumeinrevenuewasupabout40%and36%respectively.ThemaindriversinthoseareaswereequitiesFX,energyandinterestrates.Themainparticipantsarebanks,assetmanagersandagain,weareseeingsomegoodopportunitieswithinsurancecompanies.

TherehasbeensomeprogresswithinTaiwanintermsofallowingsecuritiesfirmstoofferglobalfuturessoweareworkingverycloselywithourintermediariestobringthatbusinessintoourgroup.

WithinJapan,wehaveseenconsistentgrowthofabout7%.Revenueswereupabout32%.YouhavetokeepinmindJapanisthesecondbiggestholderofUSdebtsothereisgreatopportunitiesthere.Main




drivershavebeenfrombanksandweareseeingsomenicegrowthcomingfromassetmanagers.

GillalludedtoKorea.WecontinuetoseeverynicegrowthcomingoutofKorea.ItwastwoyearsagothattherewerenoKoreanFCMsthathadanaveragemonthlyvolumeofabout100,000contracts.Todaywearehappytosaythatwehaveeightfirmsthatareprovidingatleast100,000sitespermonthwhichisagreatprogressandthedriversinthatareaareequities,rates,foreigncurrencyandenergy.

Singapore,itisupabout18%comingoutofthatregion.Weareseeingsomenicegrowthcomingfromthebanksinparticularaswellasproprietaryfirmsandcorporatesandcommercials.

AnotherareathatweareveryexcitedaboutisAustralia.Wereallyhaven'tmentionedthat.OurvolumethisyearinAustraliaisup12%andourrevenuesareupIthinkapproximately50%ifmymemoryservesmecorrectly.Thetopthreeproductsareinterestratesandequitiesandagsareupabout27%,foreigncurrenciesareupabout39%.OurmainfocusinworkingwithAustraliaagainiswithintheassetmanagementcommunityhedgefundsandthebanks.

Operator :

ChrisHarris,WellsFargo.

ChrisHarris (Analyst-WellsFargoSecurities):

Aquestiononyourmargins.Imeanagreatmarginquarter,65%,ImeanIthinkthatisoneofthebestresultsyouguyshaveeverhad.Ifwethinkbiggerpictureandyouguyskeepdeliveringdouble-digitvolumegrowthand90%incrementalmargin,yourmarginisgoingtomoveupfastinahurry.Sojustwonderingistherealimitwhereyouguysarereallycomfortableabouttakingthemargintobeforewestartseeingafairlysizableincreaseintheexpensesoristhatreallynothingforustobefocusedonatthispointintime?


Thanks,thisisJohn.Yes,wewerelimitedby100%isourlimit.Butno,inallseriousness,wecontinuetorunthebusinessasefficientlyaspossible.Asyoucanseefromtheamountofvolumewehavebeenabletohandlewithoutanyissues,wehavebeenabletohandlethatthisquarterwithoutanyincident.SoIthinkforuswedohavenaturalincreasestoourcostsovertimeandthatwouldbeinflationarythings,salaries,wagesandthelike.

Butweprovideatremendousamountofvaluetoourclientsandsoasmoreliquiditycomesintothemarketplace,thereismoretradingthatoccurswhichisatremendousbenefittoourbusinessandtheamountofvolumethatweareabletohandlewe'vebeenprovenouttohavebeenabletohandlethat.

Otherthingsthatimpactthemarginisalsothelicensefeeswepayonequitycontractsprimarilysothereissomesharethatimpactskindofourmarginlevel.Butthereisnothingartificialouttherethatpreventsthatfromgoinghigher.

PhupinderGill(CEO):

ThisisGill.IfIcouldjustaddtowhatJohnsaid.Johnisspotonwithrespecttothecurrentoperatingstructurethatwehaveandproductsaswecontinuetoinnovateacrosstheassetclasses.Butaswerolloutnewandinnovativeproductsorservicesinresponsetowhatourclients'needsareandinconjunctionwiththecapitalefficiencygoalthatwehaveforourclients,therepoclearingservicesisonesuchthingandthatisaseparateinfrastructurefromwhatwecurrentlyhave.

Johnhasfinetunedthecurrentinfrastructuretohumlikeyouareseeingitnowandwithinthatconstruct,




theoperatingmargincanabsolutelygrow.Butasyouintroducemorethingsforourclientbase,youmayseeaslightreductiondependinguponthesuccessoftheproductsandservicesthatwerollout.

Operator :

KenHill,Barclays.

KenHill(Analyst-BarclaysCapital):

Goodmorning,everyone.IjustwantedtofollowuponthemarketdataspecificallythosecustomerswhoarerationalizingtheirbehaviorandIguesschoosingtoturnthatserviceoff.Arethoseguyswhomaybedidn'tneedittobeginwithandjustrealizedthatwerepayingforitordidthisactuallyjustgettobetoohighapriceforthemtopay?

AndIguessifitisthatlatterpart,isthereanyflexibilitywithintheservicetoreallytailormarketdataforwhatacustomerneedsovertime?Potentiallycouldyouberollingoutnewproductsthatmightmeetsomeofthesepeople'sneedtohavegoneawayrecently?

PhupinderGill(CEO):

ThisisGill.IthinkasJohnalludedtoinhisremarksandinresponsetooneofthequestions,alargechunkofthatiscomingfromthelayoutthatweseethatthebanksareundergoingwithrespecttopricingpressure,itbeingtoohigh.Ifyoucompareourmarketdatafeestotheexchangesthatwecompeteagainst,youwillseethatwearelaggingbehindthemintermsofpricesowedon'tthinkthatistheissue.Wethinkitisfirmsrationalizingtheirneedsovertime.Bryan,youmightwanttoadd.

BryanDurkin (CCO):

Youcertainlyhitit.Asthefullfarecameintoplay,wedidexpectthattheremightbesomedropofffromindividualsthatmaybeusingaparticularscreenandnotreallyutilizeitfortradingquitefranklybutforobservingthemarkets.Thoselevelofusershavebeenprettysmall.ImeanthebiggestimpactasGillhadreferenceistherationalizationthatweareseeingfromfirmsthathavebeenconsolidatingtheiroperationsandmakingthosedecisionswiththerespectivereductioninstaffingandlayoffs.

Operator :

KyleVoigt,KBW.

KyleVoigt (Analyst-Keefe,Bruyette&Woods):

Thanksfortakingmyquestion.SoIwasjustwonderingifyoucouldcommentoncompetitorenergyplatform,NFX.Itlooksliketheywillbeginchargingforsomefeefortradingwiththephaseinperiodstartingnextmonth.Doyoubelievethemomentumthattheyhavehadinbuildingopeninteresttomarketshareissustainableaftertheybegintochargefortrading?Areyouhearinganyfeedbackorpressurefromyourclientsregardingthembeingunhappywithtradingfeesorotherservices?Thanks.

DerekSammann (SeniorManagingDirector,Commodities&OptionsProducts):

ThisisDerek.Thanksforyourquestion.Whenwelookatthestatusofwhereournaturalgasbusinessis,ifyoulookatthesixmonthspriortoNFXlaunches,wewereaveraginginnaturalgasoptionswheretheyaremakingtheirhardpushrightnowabout70,000contractsaday.Ifyoulookatthelastsixmonths,ourADViscloseto100,000contractssowehavegrownthatbusiness40%overthecourseoftimethatNFXhascomeintothemarketandtotheextentthatwe'vegotthefastest-growingpartofthatnaturalgasoptionsbusinessforusistheelectronicnatureofthatbusiness,arecord25%ofournaturalgasbusinesshastradedelectronically.Theyaredrivingthat40%growth.




IfyoulookatwhatNFXisputtingup,itisablockbusiness,itisnotelectronicanditisonlyonthefinanciallysettledside.Sogiventhefactthatwehaveadded30,000contractsADVsincepre-launchofNFXtopost-launchandtheyaredoing12,000to15,000,wearenotseeinganyrealfeedbackfromcustomersaskingustodoanythingdifferentotherthancontinuetoscaleourinfrastructureelectronicallyandgrowthebusiness.

Operator :

RobRutschow,CLSA.

RobRutschow(Analyst-CLSALimited):

Goodmorning.Justonemorefollow-uponthemarketdataquestion.Areyouabletosizethebankindustryintermsoftheoverallscreencount?Doesitlookssimilartothecontributiontotradingvolumes?

Andthenseparately,doesopeninganaccountattheFedgiveyouanysortoflong-termgrowthopportunitiesasidefromjustpickinguptheextraspreadthatthatprovides?Thanks.

BryanDurkin (CCO):

ItisBryan.Onthemarketdataside,yes,weareabletosizeacrosstheuserbasetheprofileofuser.Andwhilewesawadowntrendthispastquarterspecificallywithinthebanksector,Ican'tcommentwhetherornotwearegoingtoseeacontinuedtrendgoinginthatdirection.WhatIcansayisthatwearecloselymonitoringourperformanceandhaveeveryexpectationtocontinuemakingthegoodprogresswehavewithmarketdata.

PhupinderGill(CEO):

TheopeningoftheFedaccountalsogivesbothourcustomersaswellasusadditionalopportunity.

SeanT ully(SeniorManagingDirector,Financial&OTC):

Ontheheadcountsinparticularforourcustomers,itdoesallowwastoofferthemtheysignificantlyincreasedreturnontheircash.Soitshouldmakeusamorevaluablepropositionforthem.

Operator :

RichardRepetto,SandlerO 'Neill.

RichardRepetto (Analyst-SandlerO 'Neill&Partners):

Thanksforthefollow-up.Gill,onthepresentationyoutalkedabout--andthisispage16--theseculardriversofgrowthanditbeingthepotentialformorefuturesandoptionsvolumesduetocapitalefficiencies.AndIwaswonderingcanyougiveusanupdateoncrossmargining,Ithinkitwas$3billionorso?AndIguesswhatyourexpectationshereandnothavingthedealervolumeinoverthecounterinterest-rateswaps,whatdoyouthinkaboutthepotentialthereofcrossmargining?

PhupinderGill(CEO):

IwillstartandIwillaskKimaddhere.Thecapitalefficiencytitlehasatleasttwoorthreethingsbeneaththatthatmightbehelpfulforyoutothinkabout.Iwouldsayintermsoftheopportunitytobeefficientforourclientbasefuturizationisatthetopofthatlist.Sodevelopingproductsinhousethatourcustomerscanuseonamorecapitalefficientbasisisoneofthethingsthatwehavebeendoingandwillcontinuetoactuallydo.

Ifyoulookatthecompressionservicesthatweimplementednottoolongagouptothispointintime,you




havehad$21trillioninnotionalvaluethathavebeencompressedovertime.AndasyoulookattheperformanceoftheseOTCmarketitself,ithastakenanuptickfromthefourthquarteroflastyear.

Nowthisvalueproposition,thisgroupofvaluepropositionsthatIjustdescribednooneelsecanprovidethat,thecompressioninconjunctionwiththecrossmarginingandinconjunctionwiththefuturizationopportunity.SoIthinkfromthatperspective,wearequiteexcitedastheinterestrateenvironmentcontinuestoshift.


AndthenIwouldjustaddIthinkthisisnotsomethingthatisexclusivetoCMEbutCMEisworkingwiththeindustrytotryandgetbetterrecognitionforcustomermargininthetreatmentofcapitalatthebanklevel.Thatwillbeaverysignificantelementinreducingthecostofdoingbusiness.

Operator :

AlexKramm,UBS.

AlexKramm(Analyst-UBS):

Helloagainforfollow-up.Iwanttogoovertoyourequitiesbusinessforaminute.Onthatslidethatyouhadonequities,Ithinkitispage10,youmentionedthatontheS&P500optionsIguessoptionsonfuturesyounowhave--yourmarketshareincreasedrelativetoCBOE.Idon'tthinkyouhavetalkedaboutthatbusinessonacompetitivebasisinthepastorinthoseterms.Sojustwonderingifthisisanactivefocusofyourstokindoflookatthatmarketandcompetemoreaggressivelyandmaybequoteawaytheuserbasefromthesecurities-basedoptionstothefuturesmarket.Soanycolortherewillbeinteresting.Thanks.

Unidentif iedCompanyRepresentative :

Sowearealwaysfocusedontheclientsandthevaluethatwehadtoclientsandthereforewearealsoalwaysfocusedonmarketshare.Soineachandeveryoneofourbusinesses,wearecontinuouslyfocusedonourdirectcompetitorsbutalsosubstituteproductsandmakingsurethatweaddthemostvalue.

Sowhilewemaynothavetalkedaboutthisasactivelybefore,thisiscertainlysomethingthatwelookatveryclosely.Inparticularifyoulookatthatbusiness,weareveryfocusedontheabilitytocrossmarginobviouslyunderlyingfuturesagainsttheoptionsasmostefficientplatformpossible.WearecontinuouslyfocusedonTCAortotalcostanalysis.We'vetalkedaboutthisacrosseachofourdifferentbusinesslines.Ifyourecallatthebeginningoflastyear,GreenwichAssociatesdidabigstudythatlookedatourinterest-ratefuturesasalwaysbeingthelowestcostrelativetotheinterest-rateswapsindustryintermsofrepresentingrisk.

Similarlywehavecomeoutlastyearwithsomethingcalledthebigpictureandthenwedidanupdatethisyearagainwiththebigpicture.Butweareshowingthatasanexample,ourequityfuturesfarmoreefficientforinvestorsforgivingexposuretotheequitymarketthanETFs.Sowearecontinuingtolookatthesubstituteproductsbothfromacustomerclientvaluepropositionbutalsofromamarketshareperspective.

Operator :

PatrickO'Shaughnessy,RaymondJames.

PatrickO'Shaughnessy(Analyst-RaymondJames&Associates):




Sospeakingofportfoliomargining,wonderingifyoucancommentontheLSEDeutscheBoerseplannedmergerandwhethersomeofthecapitalefficienciesthattheyareproposingwouldimpactyouguyscompetitivelyIthinkspecificallywithregardtoyourrateclearingbusiness,yourrateswapclearingbusiness?

PhupinderGill(CEO):

Patrick,thisisGill.Ithinkonthefirstpartofyourquestionyoushouldaskthem.Theyseemwillingtotalkabouttheopportunities.

Onthesecondpartofthequestion,IhavetogobacktowhatSeanhadsaidbefore.Focusonthecompetitivedynamicsofwhatwealldohere.AndsowebelievethatasIsaid,wehavethebestvaluepropositionforourclientbaseandweintendtogrowuponthat.

Operator :

Wehavenofurtherquestionsatthistime.Iwouldliketoturntheprogrambacktomanagementforclosingremarks.

PhupinderGill(CEO):

Thankyousomuchforjoiningusthismorningandwelookforwardtotalkingtoyouinthenextquarter.Bye-bye.

Operator :

Andthatdoesconcludetoday'sprogram.Youmaydisconnectatthistime.Thankyouandhaveagreatday.

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CME Group (CME) Earnings Report: Q1 2016 ... - s.t.st · CME Group (CME) Earnings Report: Q1 2016 Conference Call Transcript The following CME Group conference call took place on