The Group generated net revenue of €488.4 million (Q2/2013: €497.1 million), a slight decrease year-on-year. Operating costs adjusted for exceptional items increased as planned and amounted to €249.3 million (Q2/2013: €234.1 million). The increase is attributable to consolidation effects and higher investments in growth initiatives and infrastructure. The adjusted earnings before interest and tax (EBIT) amounted to €240.6 million (Q2/2013: €266.0 million). As a result, the Group recorded adjusted basic earnings per share of €0.90 (Q2/2013: €0.97).
In the first half of 2014, the Group generated net revenue of €1,002.6 million, a slight increase year-on-year (H1/2013: €981.4 million). The Group's adjusted operating costs amounted to €492.7 million (H1/2013: €463.6 million). The adjusted EBIT amounted to €512.2 million (H1/2013: €523.8 million) and adjusted earnings per share increased slightly to €1.90 (H1/2013: €1.89).
Gregor Pottmeyer, Deutsche Börse AG's CFO and Executive Board member for human resources, said: "Second-quarter results were negatively impacted by the low equity market volatility and extremely low interest rates, although the Group was able to offset this in part with new record highs recorded by Clearstream and the positive development seen in the Market Data + Services segment. The company's diversified business model means that its earning power remains strong even in periods of low volatility, and it considers itself in a good position to meet its objectives for 2014."
Pottmeyer added: "To offset the sustained cyclical weaknesses in our core markets, we are systematically driving forward the development of new growth areas and expanding our business in Asia."
Deutsche Börse Group continued to work hard on medium-term growth initiatives in the past quarter and thus made progress in all areas. One of the focal points of the strategy is growth in Asia. In addition to Clearstream's services, which are already well established in Asia, the focus is also on expansion in the area of derivatives. For example in May, the Eurex/TAIFEX link was introduced, enabling trading and clearing of Taiwanese TAIFEX futures and options for Eurex participants. The derivatives clearing house in Singapore that is planned to open in 2015 is also being established according to schedule. In addition, Deutsche Börse and Shanghai Stock Exchange (SSE) entered into a partnership in which SSE via its wholly owned subsidiary China Investment Information Services (CIIS) will act as the official distributor and licensor of Deutsche Börse market data products in mainland China.
Already in the first quarter Deutsche Börse extend the existing strategic cooperation with Bank of China. The partnership will see Bank of China become a trading and clearing participant of Deutsche Börse Group and will give Chinese issuers and Asian investors the opportunity to directly access German and European capital markets, for example through IPOs.
Against the backdrop of the Asia growth strategy, the company is planning to propose Ms Amy Yok Tak Yip as a candidate for the Supervisory Board at its next annual general meeting in May 2015. Ms Yip has extensive experience in the Asian financial industry, including management roles at the Hong Kong Monetary Authority and DBS Bank. She is currently a member of management at investment company RAYS Capital Partners in Hong Kong.
Results for Q2/2014
In total, Deutsche Börse Group's net revenue amounted to €488.4 million in the second quarter of 2014, a slight decline of 2 per cent year-on-year (Q2/2013: €497.1 million). The Group increased net revenue in Clearstream, the post-trade segment, and the Market Data + Services segment, which partially compensate for the decline in net revenue in Eurex, the derivatives segment. Despite further growth in customer cash deposits, net interest income from banking business fell slightly to €10.4 million (Q2/2013: €11.2 million) because of persistently low interest rates.
Operating costs increased compared with the prior-year quarter to €254.4 million (Q2/2013: €243.8 million). They included costs of €5.1 million (Q2/2013: €9.7 million) notably in connection with efficiency programmes. Operating costs adjusted for these exceptional items amounted to €249.3 million (Q2/2013: €234.1 million). The year-on-year increase is attributable to consolidation effects and higher investments. The result from equity investments amounted to €1.8 million in the second quarter (Q2/2013: €3.0 million).
As a result of the development of net revenue and operating costs, EBIT stood at €235.8 million in the second quarter of 2014 (Q2/2013: €256.3 million). Adjusted for exceptional cost items, EBIT amounted to €240.6 million (Q2/2013: €266.0 million). The Group's financial result for the second quarter of 2014 improved to €-10.4 million (Q2/2013: €-20.1 million), largely due to the completed refinancing of non-current financial liabilities at favourable terms in 2013. The adjusted tax rate was 26.0 per cent in the second quarter of 2014 (Q2/2013: 26.0 per cent).
Consolidated net income for the second quarter of 2014 amounted to €159.3 million (Q2/2013: €171.0 million). Adjusted for the exceptional items mentioned above, consolidated net income was €165.2 million (Q2/2013: €178.2 million). Earnings per share, based on the weighted average of 184.1 million shares outstanding, amounted to €0.87 in the second quarter of 2014 (Q2/2013: €0.93 for 184.1 million shares outstanding); adjusted, earnings per share were €0.90 (Q2/2013: €0.97).