IntercontinentalExchange. Credit Suisse Financial Services Forum February 7, 2008

Transcription

1 IntercontinentalExchange Credit Suisse Financial Services Forum February 7, 2008

2 Forward-Looking Statements Forward-Looking Statements This presentation may contain forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of Statements regarding our business that are not historical facts are forward-looking statements that involve risks, uncertainties and assumptions that are difficult to predict. These statements are not guarantees of future performance and actual outcomes and results may differ materially from what is expressed or implied in any forward-looking statement. For a discussion of certain risks and uncertainties that could cause actual results to differ from those contained in the forwardlooking statements see our filings with the Securities and Exchange Commission (the "SEC"), including, but not limited to, the "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2006 and our Quarterly Reports on Form 10-Q for the quarters ended March 31, June 30 and September 30, 2007, each as filed with the SEC on February 26, May 4, July 27 and October 26, 2007, respectively. These filings are also available in the Investors & Media section of our website. All forward-looking statements in this presentation are based on information known to us on the date hereof, and we undertake no obligation to publicly update any forward-looking statements. February 7, 2008 Credit Suisse Financial Services Forum 2

3 ICE: Global Commodity Markets ICE is a leading, global commodity marketplace operator. Through its technology platform, ICE offers benchmark futures and options contracts for energy, soft and agricultural commodities, equity indexes and currencies, as well as the leading electronic global OTC energy marketplace. Global reach Screens distributed in 55+ countries Futures exchanges in the U.S., Europe and Canada Diverse products and markets Energy, agricultural, financial products Futures, OTC and options Superior technology Sophisticated, scalable & widely distributed platform Significant growth opportunities Organic growth, including global clearing strategy Proven M&A capabilities and strategic partnerships Strong management team and financial model Focus on innovation, customers and technology ICE offices in Asia, Canada, Europe and the U.S. Operating leverage driven by lean model February 7, 2008 Credit Suisse Financial Services Forum 3

4 ICE: Diverse Markets and Technology Expertise ICE FUTURES ICE OTC ICE DATA & SERVICES U.S. & Canada Agricultural Cocoa Coffee Cotton Sugar Orange Juice Barley Canola Oil Feed Wheat Financial Currency Pairs Euro Index US Dollar Index Russell Equity Indexes EUROPE Brent Crude WTI Crude Sour Crude Gas Oil Natural gas Electricity Coal Emissions OTC Oil and refined products Financial gas Physical gas Financial power Physical power Natural gas liquids Hundreds of Swaps, Spreads and Options contracts MARKET DATA Real-time prices/screens Indices and end of day reports Tick-data, time and sales Market price validations SERVICES ICE econfirm ecops Coffee grading facility ICE Clear U.S. ICE Clear Europe TECHNOLOGY Connect via traditional exchange telecom hubs in US, Europe and Asia, via the Internet, co-location and direct connection Fastest matching engine for commodity markets, 7ms blended; sophisticated spread implication functionality Leading electronic OTC energy markets, including credit filter and cleared/bilateral functionality ICE engineers develop and maintain proprietary exchange software and matching engine, front-end GUI and global infrastructure February 7, 2008 Credit Suisse Financial Services Forum 4

5 ICE: Customers and Markets 50% 40% 30% 20% 10% 0% Dec-06 Industry Participants Commercials producers, energy refiners, utilities, industrials and commodity users Futures Commission Merchants (FCMs) Commercial and investment banks Institutional investors, index and hedge funds, CTAs Proprietary and algorithmic traders Jan-07 Feb-07 Mar-07 Apr Day Historical Volatility May-07 Jun-07 Jul-07 ICE Brent Aug-07 Sep-07 ICE WTI Oct-07 Nov-07 Dec-07 Jan-08 Contracts in millions Market Position Volume Growth Regardless of Price Direction Sources: EIA CPI Adjusted WTI prices; FIA Energies volume Global OTC energy markets leading electronic energy marketplace for OTC natural gas and power Energy Futures trades approximately half of the world s crude oil and refined product futures Agricultural Futures leading global markets for sugar, canola oil, cotton, coffee, cocoa and OJ Equity Indexes exclusive Russell license in 2008 Foreign Exchange Currency pairs, US Dollar Index $90 $80 $70 $60 $50 $40 $30 $20 $10 $0 US$ per barrel (real) February 7, 2008 Credit Suisse Financial Services Forum 5

6 thousands $160,000 $140,000 $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 $- ICE: Key Growth Drivers $50 Q Q Q ICE Revenue 215+% Q Q Q BUSINESS FUNDAMENTALS Q $152 Q Rapidly growing commodity markets Technology leadership Global markets expansion Successful M&A integration Global clearing strategy Asset class additions Other econfirm Market Data OTC FX/Index Futures Soft/Ag Futures Energy Futures 2008 PRIORITIES Execute on clearing strategy Regulatory approval Technical integration Execute on Russell transition Cross-margining agreements Joint marketing Enhanced technology Support organic growth in core markets Expand risk management services Expand options presence Leverage acquisitions and partnerships made in 2007 February 7, 2008 Credit Suisse Financial Services Forum 6

7 ICE Futures Europe HISTORY Formed by oil market participants in 1980 ICE acquired ICE Futures Europe in 2001 and transitioned to electronic trading in ANNUAL CONTRACT VOLUME - ICE FUTURES EUROPE Regulated by the UK s FSA 120 CUSTOMERS Energy majors, refiners, distributors Financial Institutions Funds, proprietary and algorithmic traders % CAGR 92.7 GROWTH DRIVERS Crude Oil open interest over 1MM contracts Deep liquidity in both Brent and WTI crude oil benchmarks Europe s leading energy exchange, ICE Futures Europe trades approximately half of the world s crude oil and refined oil futures. Futures and Options Products Oil and refined oil products Natural gas Electricity Coal Emissions (In 000) 4Q07 4Q06 yty% Total Vol 35,761 28,196 27% Brent ADV % WTI ADV % Gas Oil ADV % Other ADV % Total ADV % February 7, 2008 Credit Suisse Financial Services Forum 7

8 ICE Futures U.S. and ICE Futures Canada HISTORY CUSTOMERS Acquired ICE Futures U.S. in 2007; listed soft commodities, index and currency futures on ICE Regulated by the CFTC Producers, growers, distributors, processors and industrials Financial Institutions Funds, proprietary and algorithmic traders ANNUAL CONTRACT VOLUME - ICE FUTURES U.S./Canada (1)(2) % CAGR GROWTH DRIVERS 90% of futures volume now electronic Exclusive on Russell Equity Indexes beginning 3Q 2008 Commodities, currencies, USDX and options ICE Futures U.S is the leading global soft commodity exchange, with diverse agricultural and financial benchmark products. ICE Futures Canada is Canada s leading agricultural exchange with more than 3.5 million contracts traded in Futures and Options Products Agricultural Cocoa Canola Coffee Feed Wheat Cotton Barley Sugar Orange Juice Financial Foreign Exchange Euro Index US Dollar Index Russell Equity Indexes Russell 1000 Russell 2000 (In 000) 4Q07 4Q06 (1) yty% Total Vol 13,618 10,822 26% Sugar ADV % Cotton ADV % Other ADV % Total ADV % (1) ICE did not own ICE Futures U.S. in Historical comparison is for illustrative purposes. (2) Canada volumes are not reflected until 3Q07. February 7, 2008 Credit Suisse Financial Services Forum 8

9 ICE Global OTC Energy Markets HISTORY Cleared OTC market created by ICE in 2002; products include forwards and swaps, differentials and spreads, and options Operates as an Exempt Commercial Market and engages in regular reporting to the CFTC $1,000 $800 Cleared Bilateral OTC - ANNUAL AVG DAILY COMMISSION $668 CUSTOMERS Commercial energy companies ~53% Banks/Financial institutions ~22% Liquidity providers (prop/algo/funds) ~25% $600 $400 58% CAGR $487 GROWTH DRIVERS Over 80% market share for cleared OTC Henry Hub natural gas contracts Product growth largely organic Chatham acquisition brings OTC options $200 $0 $233 $94 $178 $112 $80 $79 $102 $ ICE operates the leading electronic OTC marketplace for global crude and refined oil products, natural gas and power, offering price transparency, and cleared/bilateral markets in the same price stream. OTC Products Over 800 products listed, approximately 100 cleared: Oil and refined oil products Financial gas swaps and options Physical gas Financial power Physical power Natural gas liquids (In 000) 4Q07 4Q06 yty% Contracts Traded 48,829 38,348 27% Cleared 40,529 32,847 23% % Cleared 83% 86% Cleared ADC $725 $605 20% % Cleared 79% 85% Bilateral ADC $188 $108 75% % Bilateral 21% 15% Total ADC $913 $712 28% February 7, 2008 Credit Suisse Financial Services Forum 9

10 ICE: Innovation and Technology Innovations in software and network design produce unparalleled speed and reliability Future roundtrip time: 3ms Fut/OTC roundtrip time: 7ms Chicago data center increases access and reduces network latency Integration of three exchanges and two clearing houses, and technology development for a third clearinghouse completed in 2007 ICE Clear Europe development on track Futures Avg Daily Volume (Contracts) 900, , , , , , ,000 $40.0 $35.0 $30.0 $25.0 ICE Platform Speed Relative to Futures ADV Volume Round Trip Time Apr-07 May-07 Jun-07 Jul-07 ICE Technology CapEx Hardware Software & Software Development Cumulative Aug-07 Sep-07 Oct-07 Nov-07 Dec-07 $90.0 $75.0 $ Avg Daily RTT (ms) Key technology development completed $20.0 $45.0 Connectivity and system testing in February July launch expected $15.0 $10.0 $5.0 $30.0 $15.0 $ $0.0 February 7, 2008 Credit Suisse Financial Services Forum 10

11 ICE Summary Financials 2007 (In Millions, except EPS data) INCOME STATEMENT 12-mos mos 2006 yty% Total Revenues $574 $314 83% Total Expenses $221 $ % Operating Income $354 $205 73% Operating Margin 62% 65% (3) bps Income Taxes $118 $69 71% Net Income $241 $143 68% Net Margin 42% 46% (4) bps EPS (Diluted) $3.39 $ % BALANCE SHEET & CASH FLOW 12-mos mos 2006 yty% Cash & ST Investments $261 $282 (8)% Record transaction revenues Energy +45% yty Ags/Financials +41% yty OTC +41% yty Record contract volumes Energy +49% yty Ags/Financials +22% yty Record OTC commissions ADC +44% yty Record net income and operating cash flows Five acquisitions, four new asset classes, multiple strategic partnerships and 60 new products Operating Cash Flow $288 $151 91% February 7, 2008 Credit Suisse Financial Services Forum 11

12 ICE: Commodity Market Leadership Record January 2008 in OTC & Futures Markets Invest in Technology, Products & People Maintain Innovative Mindset Focus on Growth Fast growing derivatives markets New customers, global commodity markets New assets classes and products Exclusives on key indexes M&A opportunities Focus on Customers New products across futures, options, OTC Strong industry relationships Technology for traders and risk managers Value-added services, including clearing Seamless integration of acquired businesses $300 $250 $200 $150 $100 $50 $0 ICE ANNUAL OPERATING INCOME (millions) $288 $146 $151 $50 $ February 7, 2008 Credit Suisse Financial Services Forum 12

13 Q&A