UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 28, 2005
CBOT HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 333-72184 | 36-4468986 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
| 141 West Jackson Boulevard, Chicago, Illinois | 60604 | |
| (Address of Principal executive offices) | (Zip Code) |
(312) 435-3500
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On April 28, 2005, the press release set forth as Exhibit 99.1 hereto, and incorporated herein by reference, was issued to announce the financial results of the Chicago Board of Trade (CBOT) for the quarter ended March 31, 2005.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits.
| Exhibit No. |
Exhibit Description | |
| 99.1 | Press Release Regarding the CBOT’s Financial Results for the Quarter Ended March 31, 2005 |
2
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CBOT HOLDINGS, INC. | ||
| By: | /s/ Carol A. Burke | |
| Carol A. Burke | ||
| Executive Vice President and Chief of Staff | ||
Date: April 29, 2005
3
EXHIBIT INDEX
| Exhibit No. |
Exhibit Description | |
| 99.1 | Press Release Regarding the CBOT’s Financial Results for the Quarter Ended March 31, 2005 |
4
Exhibit 99.1
| For Immediate Release | Contact: | Melissa Jarmel | ||
| 312-435-7137 | ||||
| news@cbot.com |
CBOT FIRST QUARTER 2005 NET INCOME UP 30 PERCENT
CHICAGO, April 28, 2005 – The Chicago Board of Trade (CBOT®) announced today that earnings in the first quarter of 2005 rose to a new high, with record trading volume driving results. Net income climbed 30 percent to $20.8 million, compared with $16.0 million in the first quarter of 2004.
First quarter revenue reached $116.5 million, up 15 percent from $100.9 million in the first quarter of 2004. Operating income was $36.0 million, rising 34 percent from $26.9 million in the prior year. Revenue and operating income in the first quarter of 2004 include a $4.7 million benefit from member dues that were later rescinded and reversed in the fourth quarter of 2004.
CBOT President and CEO Bernard W. Dan said, “The CBOT is off to a strong start in 2005, as volume growth, in response to interest rate volatility and demand for the Exchange’s financial and equity index products, contributed to record net income for the quarter. Further, record levels of electronic trading during the quarter also contributed to the Exchange’s financial performance. The CBOT continues to work to expand its product distribution worldwide via global outreach efforts in Europe and Asia and to focus on providing premier electronic trading capabilities to market users globally.”
Trading volume in the first quarter of 2005 reached a new high. Quarterly volume rose 27 percent over the prior year to 173.1 million contracts. Average daily volume in the first quarter of 2005 increased to 2.8 million contracts, up from 2.2 million contracts in the first quarter of 2004.
Key Financial Metrics (in millions)
| Quarter Ended |
||||||||||||
| March 31 2005 |
March 31 2004 |
December 31 2004 |
||||||||||
| Revenue |
$ | 116.5 | $ | 100.9 | $ | 83.6 | ||||||
| Trading Volume |
173.1 | 136.6 | 153.4 | |||||||||
| Average Daily Volume |
2.8 | 2.2 | 2.4 | |||||||||
| Operating Margin |
31 | % | 27 | % | (1 | )% | ||||||
CBOT First Quarter Operational Highlights
| • | Set quarterly electronic trading volume record, with average daily volume reaching 1.8 million contracts |
| • | Appointed Chris Malo to newly created position of executive vice president of marketing and business development |
| • | Launched CBOT Ethanol futures on March 23, 2005 |
About the Chicago Board of Trade
The Chicago Board of Trade is one of the world’s leading and most liquid derivatives exchanges based on contract volume, with 15 percent of the global listed futures and options on futures contracts traded during 2004. By providing a diverse mix of financial, equity and commodity futures and options on futures products for more than 157 years, the Chicago Board of Trade advances into the future on the strength of deep liquidity, market integrity, and member-trader expertise. Using superior trading technology in both electronic and open-auction trading platforms, the CBOT believes that it provides premier customer service to risk managers and investors worldwide.
The CBOT’s market participants trade a variety of products, including futures and options on futures contracts on agricultural commodities, U.S. Treasury bonds and notes, interest rate swaps, DJIASM, ethanol and precious metals. Nearly 600 million contracts were traded on the CBOT’s markets in 2004, and the CBOT continues to achieve volume and open interest growth in 2005 as market participants leverage the CBOT’s unwavering commitment to strength, innovation and transparency.
On April 22, 2005, the CBOT completed a series of restructuring transactions, which, among other things, resulted in the CBOT being changed from a not-for-profit, non-stock corporation into a for-profit, stock holding company, CBOT Holdings, Inc., and a for-profit exchange subsidiary, the CBOT, as more fully explained in the proxy statement and prospectus contained within the Registration Statement on Form S-4, Registration No. 333-72184, filed by CBOT Holdings, as declared effective by the Securities and Exchange Commission on February 14, 2005.
For more information about the CBOT and its markets and products, please log on to the Exchange’s Website at www.cbot.com.
Forward Looking Statements
In this release, our use of the words “may,” “will,” “should,” “could,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or other comparable terminology is intended to identify forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or implied in any forward-looking statements. More detailed information about factors that may affect our performance may be found in filings made by CBOT Holdings, Inc. with the Securities and Exchange Commission, which can be obtained at its Web site at www.sec.gov. Except for any obligation to disclose material information under Federal securities laws, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.
CHICAGO BOARD OF TRADE
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited, in thousands)
| Quarter Ended March 31, |
Quarter Ended 2004 |
|||||||||||
| 2005 |
2004 |
|||||||||||
| REVENUES |
||||||||||||
| Exchange Fees |
$ | 66,518 | $ | 54,351 | $ | 46,326 | ||||||
| Clearing Fees |
21,277 | 16,589 | 18,724 | |||||||||
| Market Data |
18,522 | 15,979 | 16,116 | |||||||||
| Building |
5,608 | 5,398 | 6,339 | |||||||||
| Services |
3,591 | 3,056 | 4,255 | |||||||||
| Members’ Dues |
— | 4,658 | (9,315 | ) | ||||||||
| Other |
941 | 854 | 1,192 | |||||||||
| Total Revenues |
116,457 | 100,885 | 83,637 | |||||||||
| EXPENSES |
||||||||||||
| Salaries and Benefits |
18,633 | 17,915 | 17,226 | |||||||||
| Clearing Services |
16,516 | 12,210 | 14,593 | |||||||||
| Depreciation and Amortization |
13,814 | 11,292 | 12,254 | |||||||||
| Professional Services |
4,592 | 6,673 | 8,795 | |||||||||
| General and Administrative Expenses |
4,922 | 5,465 | 5,664 | |||||||||
| Building Operating Costs |
6,638 | 6,355 | 6,502 | |||||||||
| Technology |
10,677 | 8,181 | 10,575 | |||||||||
| Contracted License Fees |
1,625 | 1,443 | 1,593 | |||||||||
| Programs |
2,016 | 2,786 | 2,671 | |||||||||
| Interest |
922 | 1,324 | 1,049 | |||||||||
| Litigation |
— | — | 3,500 | |||||||||
| Severance and Related Costs |
114 | 360 | 185 | |||||||||
| Operating Expenses |
80,469 | 74,004 | 84,607 | |||||||||
| Income (Loss) from Operations |
35,988 | 26,881 | (970 | ) | ||||||||
| Provision for Income Taxes |
14,945 | 10,978 | 1,595 | |||||||||
| Income (Loss) Before Equity in Unconsolidated Subsidiary and Limited Partners’ Interest in Ceres Partnership |
21,043 | 15,903 | (2,565 | ) | ||||||||
| Equity in Loss of Unconsolidated Subsidiary - Net of Tax Effect |
(255 | ) | (139 | ) | (106 | ) | ||||||
| Limited Partners’ Interest in (Income) Loss of Ceres Partnership |
— | 254 | (50 | ) | ||||||||
| Net Income (Loss) |
$ | 20,788 | $ | 16,018 | $ | (2,721 | ) | |||||
BALANCE SHEET HIGHLIGHTS
(Unaudited, in thousands)
| March 31, 2005 |
December 31, 2004 | |||||
| Unrestricted Cash |
$ | 101,455 | $ | 91,165 | ||
| Current Assets |
196,673 | 171,962 | ||||
| Total Assets |
476,237 | 460,416 | ||||
| Current Liabilities |
99,607 | 92,888 | ||||
| Long Term Debt |
20,231 | 31,074 | ||||
| Total Liabilities |
161,734 | 166,825 | ||||
| Members’ Equity |
314,503 | 293,591 | ||||
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