Euronext achieved a strong performance in 2018

ACHIEVEMENT OF MOST OF 2019 TARGETS ONE YEAR IN ADVANCE AND SUCCESSFUL INTEGRATION OF HIGHLY ACCRETIVE ACQUISITIONS. 2019 COST TARGET ANNOUNCED

Amsterdam, Brussels, Dublin, Lisbon, London and Paris – 14 February 2019 – Euronext, the leading pan-European exchange in the Eurozone with 1,300 listed issuers, today announces its results for the full year 2018.

Strong increase of Euronext performance through 2018

• Double digit growth in full year 2018 revenue to €615.0 million (+15.5%^[1]), driven by:
  • Improved Group revenue diversification initiatives with contributions from Euronext Dublin of €24.6 million for 9 months of consolidation, FastMatch of €21.7 million and selected growth initiatives of €17.6 million
  • Listing revenue at €106.5 million (+26.4%) driven by the consolidation of Euronext Dublin and good performance of Corporate Services (€16.6 million)
  • Strong cash trading revenue of €210.9 million (+10.9%), through enhanced market share to 66.1% in 2018 (+1.7pts), effective yield management at 0.51bps (+4.9%), and improved volumes (Cash ADV at €8.1bn, +5.7%)
  • Strong performance of Advanced Data Services[2] with revenue at €118.3 million (+13.0%)
  • Non-volume related revenue accounted for 44% of total revenue in 2018, and covered 104% of operating expenses excluding D&A
• Double digit growth in full year 2018 EBITDA to €354.3 million (+19.0%), with EBITDA margin at 57.6% (+1.7pts) in a year of consolidation of recent acquisitions and delivery of major steps of Optiq® trading platform:
  • Decrease of core business costs (-4.3%) thanks to costs discipline and with significant savings generated by the successful delivery of Optiq® for cash markets
  • Group operating costs (excluding D&A) up (+11.2%) mainly impacted by the consolidation of Euronext Dublin and FastMatch, and related one-off costs
• Double digit growth in full year 2018 adjusted EPS at €3.44[3] (+11.2%). Decrease in EPS (basic) to €3.10 (-10.5%), because of negative comparison base in 2017 with one-off capital gain from LCH SA share swap and non-recurring tax release:
  • Net income, reported, share of the Group, at €216.0 million driven by strong operating performance, while impacted by €21.5 million of exceptional items and by €5.3 million of net financing expenses
• In accordance with Euronext dividend policy, a pay-out ratio of 50% of reported net income representing a dividend for 2018 of €108 million (€1.54 per share) will be proposed to the AGM[4] on 16 May 2019. As a reminder, dividend for 2017 was positively impacted by significant one-off such as capital gain from LCH SA share swap and non-recurring tax release

Achievement of most of 2019 targets of Agility for Growth strategic plan one year in advance, confirming Q3 2018 momentum

• “Deliver value to shareholders”:
  • 2018 core business and selected growth initiatives (excluding clearing) EBITDA margin at 61.6%, reaching one year in advance the 61-63% 2019 EBITDA margin target
  • ~€340 million of capital deployed in revenue diversification and expansion of Euronext decentralised model
  • ~€100 million of capital deployed in bolt-on deals, in the initial €100-150 million envelope
  • Euronext rated A (outlook stable) by S&P, in line with expected investment grade profile
•  “Enhance agility”:
  • 2019 cost reduction target achieved one year in advance with €23.8 million of cumulated core business gross savings achieved since Q2 2016 (vs. €22 million targeted) thanks to continued cost discipline, with less than half of expected restructuring costs incurred (€14.6 million vs. €33 million targeted)
  • Optiq® trading platform delivered in 2017 for Market Data, 2018 for Cash markets, February 2019 for Euronext Dublin and planned by the end of 2019 for Derivatives markets
• “Strengthen resilience of the core business”:
  • Continued core business revenue growth: +2.0% CAGR_2015-2018 vs. 2.0% CAGR_2015-2019 targeted
  • Increased market share on cash trading to 65% on average since 2017 (vs. >60% targeted) and >50% on French equity options (vs >50% targeted), and sustained yield on cash trading
• “Grow in selected segments”: €17.6 million incremental revenue in 2018 vs. €55 million targeted in 2019. Corporate Services recorded strong performance and the Tech SMEs initiative achieved good traction. ETF MTF is expected to be live in 2019. Other initiatives are not expected to provide further revenue in 2019. Euronext will continue the development of innovative projects and organic initiatives
• “Create optionality in clearing” with investment in EuroCCP in 2016 and the renewed 10-year agreement with LCH SA along with a 11.1% equity stake and a strong pre-emption right in 2017. Preferred user choice model for equity clearing is now live

Continued business diversification through highly accretive acquisitions

• Euronext Dublin contributed €24.6 million to Group revenue, for 9 months of consolidation, and ran a successful integration process with merged cross-border teams and administration systems. €2.7 million synergies were extracted in 2018
• FastMatch reported a strong performance contributing €21.7 million revenue in 2018 with a renewed management

Contemplated acquisitions of Oslo Børs VPS

On 14 January 2019, Euronext launched an all-cash tender offer to acquire all issued and outstanding shares of Oslo Børs VPS Holding ASA (“Oslo Børs VPS”). The original offer price of NOK145 per share, ie NOK6.24 billion (€625 million^[5]) for all outstanding shares of Oslo Børs VPS, has been amended to NOK158 per share, ie. NOK6.79 billion (€695 million[6]) on 11 February 2019 and the acceptance period will expire on 11 March 2019 and can be extended as appropriate. The offer remains subject to conditions presented in the offer document[7] and in the press release published on 11 February 2019³. This transaction would follow Euronext’s recent acquisition of Euronext Dublin (formerly the Irish Stock Exchange) and would represent another key milestone in the delivery of the group’s vision to build a consistent pan-European marketplace offering best-in-class capital markets services.

Cost guidance for 2019

In 2018, Euronext has extended its scope of activity both organically and through acquisitions. Furthermore, most of the core business 2019 targets of the Agility for Growth plan have been achieved one year in advance. To simplify and improve the tracking of its performance, Euronext will now report only group performance (including selected growth initiatives and new perimeter). New mid-term targets will be presented in H2 2019 as a part of the new strategic plan. In 2019, Euronext expects to limit the growth rate of its operating costs to a low single digit[8], despite the consolidation of Euronext Dublin for the full year of 2019[9].

Stéphane Boujnah, Chief Executive Officer and Chairman of the Managing Board of Euronext, said:

“Euronext delivered a strong financial performance in 2018 with double digit growth in revenue, EBITDA and adjusted EPS thanks to strengthened core business and market share on cash trading at 66%. Combined with efforts on cost, Euronext was able to reach most of its 2019 targets one year in advance, confirming the Q3 2018 momentum, with a core business and selected growth initiatives EBITDA margin reaching 61.6%. In 2018, Euronext successfully welcomed Euronext Dublin teams within the Group and achieved the migration of Irish markets to Optiq trading platform early February 2019, seven months after its transition for the Group cash markets. Euronext is pursuing its European strategy with the project to acquire Oslo Børs VPS, to reach another milestone in its value creation strategy and to fulfill its mission to finance the real economy in Europe. The Group is committed to deploy its capital and to analyze further acquisitions to expand its decentralized model in Europe and diversify its revenue profile.

Euronext Group has transformed itself in the past three years, with a top line growing by around €100m thanks to combined organic and external growth. In order to fully reflect the new Group, and given that most of the 2019 announced core business targets were met one year in advance, Euronext provides a costs guidance for 2019, prior to the release of its new strategic plan later this year, that will better help our stakeholders to assess its performance. For 2019, Euronext expects a low-single digit growth of Group operating expenses (excluding D&A) compared to 2018, thanks to its continued strong cost discipline.”