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CME Group Gets Boost from International Trading Volume

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CME Group Inc. (NASDAQ: CME) reported third-quarter 2013 results before markets opened Monday morning. For the quarter, the exchange operator posted adjusted diluted earnings per share (EPS) of $0.75 on revenues of $714.6 million. In the same period a year ago, the company reported EPS of $0.66 on revenues of $683.2 million. Third-quarter results also compare to the Thomson Reuters consensus estimates for EPS of $0.73 and $713.3 million in revenues.

The operator of the Nymex, Comex and other futures, options, commodities and derivatives exchanges reported average daily trading volume of just over 12 million contracts a day, up 11% from the third quarter a year ago, but down sequentially from 14.3 million contracts a day, as well as slightly below the first quarter total of 12.48 million contracts.

Clearing and transaction fee revenues totaled $598 million, up 6% from the same period last year. Third-quarter total average rate per contract was $0.762, up from $0.748 in second quarter of 2013, driven primarily by strong higher-paying, non-member participation during third-quarter relative to last quarter.

CME did not offer guidance in its press release, but the consensus estimates for the fourth quarter call for EPS of $0.75 on revenues of $733.75 million. The full-year estimates are $3.16 for EPS and $2.98 billion in revenues.

The company noted that electronic trading volumes grew by 16% year-over-year outside the United States, up 23% in Latin America, 22% in Asia and 15% in Europe.

The company’s executive chairman said:

Now that the three waves of the Dodd-Frank clearing mandate are completed, the market is shifting from a compliance phase to an optimization phase. Going forward, our interest rate complex will continue to benefit from our success in OTC clearing.

CME Group shares closed at $74.70 on Friday and were inactive in premarket trading Monday. The stock’s 52-week range is $49.79 to $79.45. The consensus target price for the shares was around $78.10 before the report.

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