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Nymex Holdings, the parent company of the New York Mercantile Exchange, and CBOT Holdings, the parent company of the Chicago Board of Trade, both reported record fourth-quarter and full-year earnings on the back of buoyant financial and commodity market trading activity at the two futures exchanges.
CBOT said its fourth-quarter profits more than doubled on growth in trading volume and higher average exchange fees but its results missed Wall Street expectations.
The company, which is being acquired by the Chicago Mercantile Exchange in a deal expected to close by the middle of this year, reported net income for the fourth quarter of $44.9m, up sharply from last year’s profit of $17.7m for the same period.
Excluding merger-related expenses, CBOT’s net income for the latest quarter totalled $54.4m. Revenue for the quarter ended December 31 climbed 48 per cent to $169.3m from $114.7m a year ago.
Nymex reported fourth-quarter net income of $42.3m, up 105 per cent on the same period a year earlier. Sales for the quarter were up 40 per cent to $124.8m.
The results are the first since Nymex’s initial public offering in November when its shares more than doubled from its issue price on the first day to make the best IPO performance of a US company in six years.
“Strong increases in operating revenues and net earnings were driven by record volume growth and the continued expansion of electronic trading,” said James Newsome, Nymex chief executive officer.
For the year, Nymex reported net income of $154.8m, up 118 per cent from the previous year. The net income was struck on a 49 per cent increase in total operating revenue for the group of $497.1m.
CBOT said its net income was $172.2m in the 2006 year, nearly double its 2005 profit of $76.5m.
The planned $8bn acquisition of CBOT still awaits shareholder and regulatory approval and has raised concerns among users and analysts in the US that the resulting virtual monopoly of the US futures market might lead to increased trading fees.
Some analysts claim the deal might yet fall foul of regulators on competition grounds.