NEW YORK CITY (dpa-AFX) - North American stock exchange Nasdaq OMX Group, Inc. (NDAQ) reported Friday a profit for the third quarter that increased from last year, despite a revenue decline, primarily reflecting improved operating margins. Adjusted earnings per share topped analysts' expectations by two cents, while quarterly revenues missed their estimates.
The company's board also recommended a regular quarterly dividend, and authorized an additional $500 million stock buyback.
'Nasdaq's unmatched contribution of stable, subscription and recurring revenues, and an unrelenting focus on efficiency helped deliver for our shareholders by matching non-GAAP EPS records and creating recent highs in non-GAAP operating margins. This was delivered against a backdrop of a seasonally slower period for Nasdaq across our businesses,' CEO Bob Greifeld said in a statement.
The New York-based exchange reported net income of $123 million or $0.71 per share for the third quarter, higher than $113 million or $0.66 per share in the prior-year quarter.
Excluding items, adjusted net income for the latest quarter was $125 million or $0.72 per share. On average, 15 analysts polled by Thomson Reuters expected the company to report earnings of $0.70 per share for the quarter. Analysts' estimates typically exclude special items.
Market services revenues for the quarter were $515 million, up from $499 million in the comparable quarter a year ago.
Net exchange revenues, excluding transaction rebates, brokerage, clearance and exchange fees, declined 2 percent to $497 million from $506 million in the same quarter last year, and missed thirteen Wall Street analysts' consensus estimate of $510.60 million.
Market Services net exchange revenues for the quarter decreased 3 percent to $194 million, and information Services revenues declined 2.6 percent to $114 million from the prior-year quarter.
Technology Solutions revenues decreased 1.5 percent to $130 million, while listing services revenues grew 3.5 percent to $59 million from the year-ago quarter.
Operating income for the quarter grew to $207 million from $202 million in the year-ago quarter. Adjusted operating income increased to $213 million from $202 million in the prior-year quarter, with operating margins improved 300 basis points to 43 percent from last year's 40 percent.
'Our unwavering focus on profitability led to declines in expenses, offsetting revenue headwinds from a number of discrete, temporary factors. These factors included foreign exchange, a significant decline in data audit collections, and certain planned revenue impacts in acquired businesses,' CFO Lee Shavel noted.
During the third quarter, the company got a total of 76 new listings, including 41 initial public offerings, compared to total listings of 59 in the third quarter of 2013.
Further, the company's board recommended a $0.15 per share regular quarterly dividend, payable on December 26 to shareholders of record on December 12, 2014.
The company's board also authorized an additional $500 million stock repurchase, bringing the total available authorization to about $560 million.
In Friday's regular trading session, NDAQ is currently trading at $40.23, down $1.06 or 2.57% on a volume of 0.22 million shares.
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