Deutsche Boerse AG (DBOEY.PK, DBOEF.PK) Monday posted a profit for the fourth quarter, driven mainly by lower costs as well as increase in revenues.
The Eschborn, Germany-based bourse operator's net income for the quarter was 141.9 million euros or 0.78 euro per basic share, compared to a loss of 61.2 million euros or 0.33 euro per basic share last year.
Total costs dropped 56 percent to 271.9 million euros from last year, as last year was impacted by an hefty ISE impairment charge. Excluding costs related to the prohibited merger with NYSE Euronext and costs for efficiency measures in 2011 and the ISE impairment and costs for efficiency measures in 2010, costs fell by 5 percent to 310.8 million euros.
In 2010, the company recorded an hefty asset impairment charge related to the International Securities Exchange, ISE, to reflect the lower value of its struggling U.S. equity options business.
Last week, Deutsche Boerse called off the deal to merge with NYSE Euronext (NYX) after European regulators notified its decision to block the deal citing monopoly concerns.
On an adjusted basis, net income for the quarter rose to 165.1 million euros or 0.91 euro per basic share from 153.4 million euros or 0.82 euro per basic share last year.
EBIT, earnings before interest and tax, for the quarter was 228.0 million euros compared to 219.3 million euros last year. On an adjusted basis, EBIIT for the quarter advanced to 256.2 million euros from 221.8 million euros last year.
Deutsche Boerse, the operator of the Frankfurt stock exchange, said sales revenues for the period grew to 541.4 million euros from 518.4 million euros last year. Net interest income from banking division rose to 19.3 million euros from 16.9 million euros, while other operating income increased to 16.5 million euros from 12.2 million euros last year.
For the full year 2011, net income increased to 848.8 million euros or 4.57 euro per share from 417.8 million euros or 2.25 euro per share last year. Sales revenues for the full year grew to 2.23 billion euros from 2.11 billion euros last year.
Deutsche Boerse board has proposed to boost its regular dividend by 10 percent to 2.30 euro per share and also to pay a special dividend of 1.00 euro in May 2012. The proposal was based on the business performance in 2011 and the Group's capital and liquidity position.
The board also plans for share buybacks of up to 200 million euros in the second half of 2011.
Moving forward, Deutsche Boerse said it will increase investments in growth initiatives and infrastructure from 120 million euros to around 160 million euros in 2012.
Chief Executive Reto Francioni said, "Our outlook for 2012 is positive."
On the Frankfurt exchange, Deutsche Boerse closed Monday's trading at 49.00 euro, up 0.16 euro or 0.33%.
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