Intercontinental Exchange Reports Strong Full Year 2023 Results

18th consecutive year of record revenues

Intercontinental Exchange (NYSE:ICE):

Intercontinental Exchange (NYSE:ICE), a leading global provider of technology and data, today reported financial results for the fourth quarter and full year of 2023. For the quarter ended December 31, 2023, consolidated net income attributable to ICE was $373 million on $2.2 billion of consolidated revenues less transaction-based expenses. Fourth quarter GAAP diluted earnings per share (EPS) was $0.65. Adjusted net income attributable to ICE was $760 million in the fourth quarter and adjusted diluted EPS was $1.33.

For the full year of 2023 consolidated net income attributable to ICE was $2.4 billion on $8.0 billion of consolidated revenues less transaction-based expenses. Full year 2023 GAAP diluted EPS was $4.19, up 62% year-over-year. On an adjusted basis, net income attributable to ICE for the year was $3.2 billion and adjusted diluted EPS was $5.62, up 6% year-over-year.

Please refer to the reconciliation of non-GAAP financial measures included in this press release for more information on our adjusted operating expenses, adjusted operating income, adjusted operating margin, adjusted net income, adjusted diluted EPS and adjusted free cash flow.

Warren Gardiner, ICE Chief Financial Officer, added: "In 2023, we once again generated record revenues and record operating income. This performance is a clear testament to the strength of our strategically diversified business model, which, through an array of macroeconomic environments, continues to deliver consistent and compounding growth for our stockholders. As we enter 2024, we remain well positioned to benefit from numerous cyclical tailwinds and secular trends."

Fourth Quarter and Full Year 2023 Business Highlights

Fourth quarter consolidated net revenues were $2.2 billion, up 25% year-over-year, including exchange net revenues of $1.1 billion, fixed income and data services revenues of $563 million and mortgage technology revenues of $502 million. Consolidated operating expenses were $1.3 billion for the fourth quarter of 2023. On an adjusted basis, consolidated operating expenses were $952 million. Consolidated operating income for the fourth quarter was $925 million and the operating margin was 42%. On an adjusted basis, consolidated operating income for the fourth quarter was $1.2 billion and the adjusted operating margin was 57%.

Full year 2023 consolidated net revenues were $8.0 billion, up 10% year-over-year, including exchange net revenues of $4.4 billion, fixed income and data services revenues of $2.2 billion and mortgage technology revenues of $1.3 billion. Consolidated operating expenses were $4.3 billion for 2023. On an adjusted basis, consolidated operating expenses were $3.3 billion. Consolidated operating income for the year was $3.7 billion and the operating margin was 46%. On an adjusted basis, consolidated operating income for the year was $4.7 billion and the adjusted operating margin was 59%.

Exchanges Segment Results

Fourth quarter exchange net revenues were $1.1 billion, up 16% year-over-year. Exchange operating expenses were $337 million and on an adjusted basis, were $321 million in the fourth quarter. Segment operating income for the fourth quarter was $799 million and the operating margin was 70%. On an adjusted basis, operating income was $815 million and the adjusted operating margin was 72%.

Full year exchange net revenues were $4.4 billion, up 9% year-over-year. Exchange operating expenses were $1.3 billion and on an adjusted basis, were $1.2 billion for the full year. Segment operating income for 2023 was $3.2 billion and the operating margin was 71%. On an adjusted basis, operating income was $3.2 billion and the adjusted operating margin was 73%.

Fixed Income and Data Services Segment Results

Fourth quarter fixed income and data services revenues were $563 million, up 5% year-over-year. Fixed income and data services operating expenses were $363 million and adjusted operating expenses were $322 million in the fourth quarter. Segment operating income for the fourth quarter was $200 million and the operating margin was 36%. On an adjusted basis, operating income was $241 million and the adjusted operating margin was 43%.

Full year 2023 fixed income and data services revenues were $2.2 billion, up 7% year-over-year. Fixed income and data services operating expenses were $1.4 billion and on an adjusted basis, were $1.3 billion for the year. Segment operating income for the full year was $811 million and the operating margin was 36%. On an adjusted basis, operating income was $979 million and the adjusted operating margin was 44%.

Mortgage Technology Segment Results

Fourth quarter mortgage technology revenues were $502 million. Mortgage technology operating expenses were $576 million and adjusted operating expenses were $309 million in the fourth quarter. Segment operating loss for the fourth quarter was $74 million and the operating margin was (15)%. On an adjusted basis, operating income was $193 million and the adjusted operating margin was 39%.

Full year mortgage technology revenues were $1.3 billion. Mortgage technology operating expenses were $1.6 billion and adjusted operating expenses were $809 million in 2023. Segment operating loss for the full year was $276 million and the operating margin was (21)%. On an adjusted basis, operating income was $508 million and the adjusted operating margin was 39%.

Other Matters

• Operating cash flow for 2023 was $3.5 billion and adjusted free cash flow was $3.2 billion.
• As of December 31, 2023, unrestricted cash was $899 million and outstanding debt was $22.6 billion.
• ICE paid $955 million in dividends in 2023.

Financial Guidance

Earnings Conference Call Information

ICE will hold a conference call today, February 8, at 8:30 a.m. ET to review its fourth quarter 2023 financial results. A live audio webcast of the earnings call will be available on the company's website at www.theice.com in the investor relations section. Participants may also listen via telephone by dialing 833-470-1428 from the United States or 929-526-1599 from outside of the United States. Telephone participants are required to provide the participant entry number 571937 and are recommended to call 10 minutes prior to the start of the call. The call will be archived on the company's website for replay.

The conference call for the first quarter 2024 earnings has been scheduled for May 2nd at 8:30 a.m. ET. Please refer to the Investor Relations website at www.ir.theice.com for additional information.

Historical futures, options and cash ADV, rate per contract, open interest data and CDS cleared information can be found at: https://ir.theice.com/investor-resources/supplemental-information/default.aspx

Non-GAAP Financial Measures and Reconciliation

We use non-GAAP measures internally to evaluate our performance and in making financial and operational decisions. When viewed in conjunction with our GAAP results and the accompanying reconciliation, we believe that our presentation of these measures provides investors with greater transparency and a greater understanding of factors affecting our financial condition and results of operations than GAAP measures alone. In addition, we believe the presentation of these measures is useful to investors for period-to-period comparison of results because the items described below as adjustments to GAAP are not reflective of our core business performance. These financial measures are not in accordance with, or an alternative to, GAAP financial measures and may be different from non-GAAP measures used by other companies. We use these adjusted results because we believe they more clearly highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures, since these measures eliminate from our results specific financial items that have less bearing on our core operating performance. We strongly recommend that investors review the GAAP financial measures and additional non-GAAP information included in our Annual Report on Form 10-K, including our consolidated financial statements and the notes thereto.

Adjusted operating expenses, adjusted operating income, adjusted operating margin, adjusted net income attributable to ICE common stockholders, adjusted diluted earnings per share and adjusted free cash flow for the periods presented below are calculated by adding or subtracting the adjustments described below, which are not reflective of our cash operations and core business performance, and their related income tax effect and other tax adjustments (in millions, except for per share amounts):

About Intercontinental Exchange

Intercontinental Exchange, Inc. (NYSE:ICE) is a Fortune 500 company that designs, builds, and operates digital networks that connect people to opportunity. We provide financial technology and data services across major asset classes helping our customers access mission-critical workflow tools that increase transparency and efficiency. ICE's futures, equity, and options exchanges -- including the New York Stock Exchange -- and clearing houses help people invest, raise capital and manage risk. We offer some of the world's largest markets to trade and clear energy and environmental products. Our fixed income, data services and execution capabilities provide information, analytics and platforms that help our customers streamline processes and capitalize on opportunities. At ICE Mortgage Technology, we are transforming U.S. housing finance, from initial consumer engagement through loan production, closing, registration and the long-term servicing relationship. Together, ICE transforms, streamlines, and automates industries to connect our customers to opportunity.

Trademarks of ICE and/or its affiliates include Intercontinental Exchange, ICE, ICE block design, NYSE and New York Stock Exchange. Information regarding additional trademarks and intellectual property rights of Intercontinental Exchange, Inc. and/or its affiliates is located at http://www.intercontinentalexchange.com/terms-of-use. Key Information Documents for certain products covered by the EU Packaged Retail and Insurance-based Investment Products Regulation can be accessed on the relevant exchange website under the heading "Key Information Documents (KIDS)."

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 - Statements in this press release regarding ICE's business that are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see ICE's Securities and Exchange Commission (SEC) filings, including, but not limited to, the risk factors in Intercontinental Exchange, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 8, 2024. We caution you not to place undue reliance on these forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of an unanticipated event. New factors emerge from time to time, and it is not possible for management to predict all factors that may affect our business and prospects. Further, management cannot assess the impact of each factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

SOURCE: Intercontinental Exchange

Category: Corporate

ICE-CORP

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