NYSE Euronext Q1 net income dips 55% to $104 mn

NYSE Euronext, one of the world's biggest bourses, today said it has reported a 54.78% decline in net income at $104 million in the first quarter of 2009, largely due to adverse market conditions.      

The company had a net income of $230 million, in the first quarter of 2008, NYSE Euronext said in a statement.     

"Since we reported record results in the first quarter of 2008, the financial services landscape has undergone a significant transformation," NYSE Euronext CEO Duncan L Niederauer said while commenting of the earnings.       

Niederauer further said, "Despite adverse market conditions, we (NYSE Euronext) have stayed focused on executing our two-pronged strategy, to broaden and diversify our streams of revenue, and at the same time, reduce our costs and make us more efficient, streamlined and agile."      

With each new quarter, the bourse continues to make steady progress on both fronts, and "I am confident that as market conditions stabilise we will be well positioned for growth," Niederauer said.      

As on March 31, 2009, NYSE Euronext has cash, cash equivalents, investment and other securities of $0.7 billion and a gross debt of $2.5 billion, a decrease of $0.4 billion from $2.9 billion on December 31, 2008.      

NYSE Euronext would make a $0.30 quarterly dividend per share payment on June 30, 2009, to shareholders in record as of June 15, 2009.

NYSE Euronext Group Executive Vice-President and Chief Financial Officer Michael S Geltzeiler said, "In the first quarter, we accelerated our cost efficiency initiatives, which resulted in a $51-million decline in fixed costs compared to the fourth quarter of 2008."      

"Furthermore we achieved our $120 million first quarter target for run-rate technology savings, we already achieved the $120 million in cost savings related to our acquisition of Amex, and we have significantly increased the pace of our restructuring plans in the US and Europe," he said.      

Based on the first quarter results and an accelerated company-wide focus on expense rationalisation efforts, NYSE Euronext is increasing its cost savings guidance by an incremental $100 million, to be realised in 2009.      

Meanwhile, the strategic partnership between the State of Qatar and NYSE Euronext is in the process of being restructured.      

As part of the restructured agreement, NYSE Euronext would now purchase a 20% stake in the Qatar Securities Market (QSM) for $200 million, with instalment payments of $40 million over a period of four years from closing.      

The restructured agreement is now expected to close in the next few months.