Low Trading Volumes Hurt Euronext’s Revenues in Q3 2016

Euronext has seen its revenues drop due to lower trading volumes in the third quarter of the year.

Euronext, Europe’s largest exchange, has reported its latest result of financial metrics for Q3 2016, which show disappointing revenues relative to the relevant period last year, according to its latest earnings release.

In terms of actual numbers, Euronext reports revenues of just €112.8 million in the third quarter of the year. This is a decrease in revenue of 15.2% from €133.0 million in Q3 2015 which was the second best quarter ever. The drop in revenues is also along similar lines in a month over month comparison as Q2 2016’s figure was €132.3 million.

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The venue explains that revenue was impacted by lower trading volumes – cash average trading volumes at Euronext decreased by -29.4% compared with Q3 2015 – and the fall in IPOs and M&A driven listing operations. On the positive side for Q3, the venues boasts of the launch of a new trading facility to improve liquidity in pan-European corporate bond trading.

“Facing a challenging market environment in Q3, both in listing and trading, due to the uncertainty lingering on after the Brexit referendum, combined with significantly lower volatility compared to the same period last year, Euronext revenue was down. However, our continuous cost discipline generated incremental efficiencies. As a whole, we achieved a 54.4% EBITDA margin in Q3. If the market conditions were to remain what they are or improve during Q4, we are confident that our EBITDA margin for the full year will be above the one of 2015.” said Stéphane Boujnah, Chairman and CEO of the Managing Board of Euronext NV.

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