Euronext FX Sees 18% Jump in Q1 Revenue, Pushed by Volatility

Euronext (EPA: ENX), one of the pan-European market infrastructure companies, reported a 58.8 percent jump in its Q1 revenue and income which came in at €395.7 million. The figures were dragged by the acquisition of Boursa Italiana last year.

On a pro-forma basis, that is including the Borsa Italiana’s financial performance for the entire comparative period, the revenue jump was 6 percent. Boursa Italiana brought in €129.4 million in the three months.

The total trading revenue of the group was €150.8 million, which came in 57.2 percent higher than the same quarter of the previous quarter. The platform offers several classes of trading instruments, including cash trading, derivatives trading, fixed income trading, forex trading and energy trading.

FX Business Boom

The FX trading demand on Euronext’s platforms saw an 18 percent jump between January and March. The FX revenue came in at €7.2 million, which was higher than the €6.1 million for Q1 of 2021. Additionally, the average daily volume (ADV) with FX trading jumped by 14 percent to $24.5 billion.

Moreover, it was the second best quarter, only after Q1 of 2020, for Euronext FX in terms of both revenue and ADV. The demand was driven by the positive impact of heightened overall volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term.

Strong Non-Trading Demand

Additionally, Euronext pointed out that its non-trading-related business brought in 55 percent of the revenue in the quarter. Its post-trade revenue jumped to €95.8 million, which is 51.7 percent higher on a reported basis and 3.1 percent higher on a pro-forma basis. Also, clearing revenue increased to €31.9 million and custody and Settlement revenue to €63.9 million. Both of them jumped by 87.2 percent and 38.6 percent, respectively, on a reported basis.

Furthermore, the group’s advanced data services grew by 43.9 percent to €52.6 million.

The adjusted EBITDA of the group for the quarter came in at €252.2 million. It is 66.8 percent higher reportedly and 11.4 percent on a pro-forma basis. The reported net income came in 46.5 percent higher at €143.8 million, with the adjusted earnings per share at €1.54.

“During this first quarter of 2022, which was marked in Europe by the Russian invasion of Ukraine, Euronext’s business model remained resilient,” said Stéphane Boujnah, Euronext’s Chairman and CEO.

“We remained committed to pursuing successful integration while maintaining our continued cost discipline.”