For the convenience of investors, NYSE Euronext (NYSE Euronext: NYX) today reported that for the three months ended March 31, 2007, on a pro forma combined basis as if the merger between NYSE Group and Euronext had been consummated on January 1, 2007, revenues would have been $1.12 billion (including $186 million of activity assessment fees), operating income would have been $264 million, and net income would have been $161 million, or $0.60 per diluted share.
The combination between NYSE Group and Euronext was consummated on April 4, 2007. Under the purchase method of accounting, NYSE Group was treated as the accounting acquirer of Euronext. Allocations of the purchase price to Euronext's assets and liabilities used in the pro forma combined financial information are only preliminary allocations based on current estimates of fair values and may change when such estimates are finalized.
The pro forma combined results of operations for the three months ended March 31, 2007 present the consolidated results of operations of NYSE Euronext as they may have appeared had NYSE Group and Euronext actually been combined on January 1, 2007. The results of operations may have been different had the companies actually been combined as of that date. This information should not be relied upon as an indication of the historical results that would have been achieved had the companies been actually combined, or as an indication of the future results of NYSE Euronext.
These pro forma combined results of operations for the three months ended March 31, 2007 do not include any revenue or cost saving synergies that may be achievable subsequent to the completion of the April 4, 2007 combination, or the impact of non-recurring items directly attributable to either the merger of the NYSE and Archipelago or the merger of NYSE Group and Euronext.
The pro forma combined results of operations of NYSE Euronext include the historical results of operations of Euronext for the three months ended March 31, 2007, converted from International Financial Reporting Standards (IFRS) into U.S. Generally Accepted Accounting Principles (US GAAP), and have been translated using an average exchange rate of EUR 1.00 = $1.3105. A change of five percent in the average exchange rate for the three months ended March 31, 2007 would have had a $5.0 million impact on the pro forma combined net income, or $0.02 per diluted share.
The pro forma combined statement of income for the three months ended March 31, 2007 should be read together with the first quarter 2007 earnings of NYSE Group and Euronext released on April 26, 2007 and May 22, 2007, respectively, as well as NYSE Euronext's Form 10-Q filed for the period ended March 31, 2007, and are for illustrative purposes only.
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