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Article Excerpt
HOWARD CHEN, ANALYST, CREDIT SUISSE: We're really pleased to welcome back IntercontinentalExchange for the third year to our conference. It seems like it's never a dull time for ICE and its management team. Since its 2001 acquisition of the International Petroleum Exchange in London, the Company has amassed a dominant global over-the-counter and exchange traded futures franchise that began with predominantly energy derivatives. And over time, it's broadened to soft agricultural products, foreign exchange, equity index, and, most recently, credit-related products.
In 2008, among other achievements, ICE continued to enjoy exceptional growth and profitability of its over-the-counter and futures businesses, completed its in-house clearing operations, migrated the equities -- the Russell equities future contract over from the Chicago Mercantile Exchange, and acquired Creditex, an inter-dealer CDS broker.
Here to share with us his thoughts on the long-term outlook for the Company and current operating environment is Founder, CEO, and Chairman Jeff Sprecher.
JEFF SPRECHER, FOUNDER, CEO, CHAIRMAN, INTERCONTINENTALEXCHANGE INC.: Good morning, everybody. Thanks for being here with me. Let me first call your attention to our Safe Harbor language, and I want to thank Howard. He does a lot of work in our space and a lot of work on our companies. He's really one of the good analysts in our space and I'm always happy to be here to support Credit Suisse.
And in addition, one of the colleagues of Howard is now the head of ISDA and has taken a leadership role in working to restructure the credit default swap market and has been working intimately with us, and really helped forge a great relationship between our firms, which we really appreciate as well.
So with that, I'd like to start by introducing our Company to those of you who haven't met us before. We are, as Howard mentioned, a global exchange operator, and I want to give you a brief overview of our futures markets, our over-the-counter markets, and our clearing capabilities.
We have a very highly scalable electronic proprietary trading and clearing platform that we operate around the world. We operate a global over-the-counter marketplace. We have three regulated futures exchange subsidiaries, and those are located in three different countries. And now, with the launch of our -- the recent launch of our European clearinghouse in November, we have three regulated clearinghouses around the world.
As I alluded to, we have another clearinghouse under development for the credit default swap market called ICE Trust, which is actually being set up as a bank.
We serve very broad segments of the derivatives markets, including energy, agricultural commodities, credit default swaps, foreign exchange, and equity indices.
Today, we are one of the most global exchanges. We have a tremendous reach and distribution of our platform in more than 50 countries. And more than one-third of our revenue is now emanating from outside the United States.
The Company has been very successful and has delivered among the best results in our space, and so, we have been in a luxurious position to be able to look for interesting M&A opportunities that have also supported a tremendous organic growth.
The management team that I have been able to recruit is really innovative, and they have a tremendous focus on both our customers and market opportunities that our customers bring us, and it's been able to drive a financial model that has very, very strong results, and has been very consistent in terms of our track record of innovation.
I want to just take a minute and discuss our unique market structure across futures, over-the-counter trading, clearing, and technology. And at the bottom of the slide, there is a big bar that says technology, which really is the foundation of our business. It's allowed us to integrate very diverse trading markets. It's allowed us to integrate new acquisitions, to launch new products, to build new clearinghouses, trade confirmation systems, and market data dissemination businesses.
So, using that technology, we have been able to connect to the front, middle, and back offices of our customers around the globe.
If you move up the slide, you'll see that we offer agricultural products, currency products, and index products at our futures exchanges in the United States and in Canada. And we offer energy and emissions products at our futures exchange in Europe.
We also operate global over-the-counter markets, both in energy and in credit. Our OTC energy markets are all electronic and our credit business operates as a hybrid between voice and electronic. The two clearinghouses that we have in North America support our futures and over-the-counter product footprint.
And as I mentioned, in Europe, our new clearinghouse, called ICE Clear Europe, is the first new clearinghouse to be built in London in more than 100 years. It supports our energy futures and our over-the-counter markets. It's already starting to allow us to move significantly to expand our offerings in other asset classes.
At the end of October, we announced that we were going to purchase a fourth clearinghouse, known as The Clearing Corporation, which will become the technology provider to the ICE Trust bank that...
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