Euronext, Europe’s largest exchange, has released its financial metrics for the first quarter of 2016 revealing a slight decrease in revenue, perpetuated by turbulent market conditions, according to a Euronext statement. Earlier this month, the exchange reported its trading volumes for April 2016 which saw a sizable decline across its cash order book.
Financial performance third party quarterly revenue decreased by -2.7 percent to €126.5 million ($144.5 million) compared with €130.0 million ($148.5 million) in Q1 2015, driven mainly by lower volumes on cash trading business and a pause in the IPO market resulting from uncertain macroeconomic conditions in the first quarter of the year.
Operational expenses decreased by -12.1 percent to €54.7 million ($62.5 million) compared with €62.2 million ($71 million) in Q1 2015, resulting from the benefits of cost restructuring efforts implemented throughout 2015. It was noted that the Q1 2016 cost base does not fully reflect the actual run-rate of the group as the quarter was positively impacted by some non-recurring items in the compensation and benefits line of about €3 million ($3.4 million).
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The ongoing robust cost discipline has enabled the EBITDA margin to strongly improve in Q1 2016 to 56.8 percent compared with 52.2 percent in Q1 2015.
Quarterly operating profit before exceptional items was €68 million ($77.6 million), representing a 7.6 percent increase compared with last year’s €63.3 million ($72.2 million). The net profit for Q1 2016 amounted to €48 million ($54.8 million), the same as in Q1 2015.
Commenting on the results, Stéphane Boujnah, Chairman and CEO of the Managing Board of Euronext, said: “Despite turbulent market conditions, Euronext has continued to improve its EBITDA margin thanks to the Company’s ongoing cost discipline. These results once again demonstrate the resilience of Euronext business model.”
Euronext’s new strategic plan entitled “Agility for Growth” which is due to be released tomorrow, 13 May 2016, seeks to reinforce the exchange’s commitment towards maintaining robust cost control while increasing emphasis on selected growth initiatives.