CME profit rises 21% as interest-rate volume returns

CME Group Inc., the world's largest futures market, said first-quarter earnings rose 21 percent as interest-rate futures trading rebounded from a year ago when the global credit crisis cut demand for the company's products.

Net income climbed to $240.2 million, or $3.62 a share, from $199.1 million, or $3, a year earlier, Chicago-based CME said in a statement today distributed by PR Newswire. CME was estimated to earn $3.60, according to a Bloomberg survey of 22 analysts.

Average daily volume at CME Group climbed 12 percent in the quarter, led by a 33 percent rise in interest-rate contracts and a 75 percent jump in currency futures trading, the company said April 5.

"A large rebound in interest rate futures trading volumes is the firm's largest growth opportunity in 2010," Patrick O'Shaughnessy, an analyst with Raymond James & Associates, wrote in an April 20 note to clients. Excluding certain items, the Chicago-based analyst expected CME Group to earn $3.55 a share, he wrote last week.

CME Group shares have gained 45 percent in the past year through yesterday after tumbling from a high of $710.75 in December 2007 to a low of $156.55 in November 2008 as the credit crisis cut the amount of borrowed money used to trade, interest rates near zero percent reduced the need to hedge with futures and regulatory concerns worried investors.

CME Group fell $2.95 to $330.31 yesterday in Nasdaq Stock Market composite trading.

Revenue rose 7.1 percent to $693.2 million last quarter from $647.1 million a year earlier. CME Group controls 98 percent of U.S. futures trading.

Expenses at the exchange increased 6.8 percent to $278.5 million from $260.7 million a year ago.

(CME Group will hold a conference call for analysts and investors at 8:30 a.m. New York time. To listen, access the company's Web site at www.cmegroup.com)