Q3 2024 Deutsche Boerse AG Earnings Call Transcript
Key Points
- Deutsche Boerse AG (DBOEF) reported double-digit growth in financial derivatives, driven by temporary spikes in volatility.
- The company achieved significant market share gains in commodities and EX trading in Europe, with new client acquisitions contributing to growth.
- The fund service segment saw a 14% net revenue growth in custody and a 37% increase in settlement, reaching a record level of EUR3.8 trillion in fund assets under custody.
- The security services segment benefited from increased cash balances and higher equity market levels, leading to record assets under custody of EUR15.2 trillion.
- Deutsche Boerse AG (DBOEF) updated its guidance for 2024, expecting net revenue to reach around EUR5.8 billion, with EBITDA projected between EUR3.3 billion and EUR3.4 billion, aligning with market expectations.
- The equity-related derivatives environment was more muted, impacting revenue growth in this segment.
- There was a decline in margin fees in the power spot product, offsetting some of the revenue gains.
- The market intelligence segment faced competitive pressures, leading to a downward trend in performance.
- The ISS stocks business was behind plan, affecting overall growth expectations for 2024.
- The company is cautious about M&A activities due to ongoing integration challenges, potentially limiting growth opportunities.
(audio in progress) more cost sensitive in light of the market environment in the asset management industry.
Let me turn to slide 11, the trading and clearing segment. In financial derivatives at (technical difficulty), we saw double-digit growth. In equity related product, temporary spikes of volatility had a positive impact revenue but the fact on that the environment for equity-related derivatives was more muted.
In fixed income-related products, we continue to see the impact from incentives for building initial [equity] in short-term interest rate derivatives, but does effect whereby far overcompensated through revenue growth in fixed income futures and OTC clearing.
In commodities and EX, the growth was mainly driven by a new record levels of (technical difficulty) trading in Europe. This was the result of significant market share gains from OTC and business from new clients, including (technical difficulty) driven participants.
An increase in net revenue from power spot product was compensated by a decline in margin fees. Our
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