ATLANTA, Jan. 31 /PRNewswire-FirstCall/ -- IntercontinentalExchange, Inc. (NYSE: ICE - News), a leading operator of global exchanges and over-the-counter (OTC) markets, reported consolidated net income for the fourth quarter of 2007 of $64.7 million, a 32% increase compared to $49.0 million for the fourth quarter of 2006. Diluted earnings per share (EPS) in the fourth quarter were $0.90, an increase of 11% over the prior year''s fourth quarter of $0.81. Fourth quarter net income and EPS were reduced by $3.0 million and $0.04 per share due to certain non-cash compensation expense related to ICE''s performance-based equity program and recorded under an accelerated method of expense recognition. Consolidated revenues in the fourth quarter increased 67% to a record $159.3 million, from $95.3 million in the fourth quarter of 2006. This marks ICE''s eighth consecutive quarter of record revenues.
For the year ended December 31, 2007, ICE achieved record revenues for the fourth consecutive year, reporting an 83% rise in consolidated revenues to $574.3 million compared with $313.8 million in the prior year. Consolidated net income increased 68% to a record $240.6 million in 2007 from $143.3 million in 2006. Diluted EPS for 2007 was $3.39, an increase of 41% over 2006. The 2007 results include expenses related to ICE''s proposed merger with the Chicago Board of Trade of $11.1 million, or $7.2 million after tax. Record consolidated cash flow from operations grew 91% to $287.8 million in 2007.
ICE''s European and North American futures exchanges achieved record annual volume in 2007, with increases of 49% and 22%, respectively, totaling 192.0 million contracts combined. In 2007, average daily volume (ADV) for ICE Futures Europe(TM) was 539,044; ADV for ICE Futures U.S.(TM) and ICE Futures Canada(TM) was 232,566 contracts. Average daily commissions for ICE''s OTC segment during 2007 increased to a record $845,572, a 44% increase over 2006. For businesses acquired last year, 2007 volume and commission levels reflect only the time period after the closing date of each transaction. ICE Futures U.S., formerly the New York Board of Trade, was acquired on January 12, and ICE Futures Canada, formerly the Winnipeg Commodity Exchange, was acquired on August 28.
"By continuing to transform and diversify our global marketplace, we achieved record results for the fourth quarter and for 2007," said Jeffrey C. Sprecher, ICE Chairman and Chief Executive Officer. "The ICE team delivered on many key initiatives over the last year, including completing and integrating five acquisitions as well as a comprehensive redevelopment of our technology platform. This year is also off to a very strong start, including record levels of OTC commissions and futures volume in January, as well as a record number of participants on the ICE platform. We are busy pursuing a range of new opportunities while executing on the many initiatives that we began last year to drive both near-term and long-term growth."
Sprecher continued: "Among these initiatives are introducing our European clearing house, growing our equity index business through our exclusive Russell license and expanding the valuable futures and OTC businesses we acquired last year. Importantly, we continue to see organic growth in our core energy futures and OTC businesses. We maintain our focus on innovation and growth by being responsive to our customers'' evolving needs, entering new markets, advancing our technology, and continuing our strategic approach to M&A."
Fourth Quarter 2007 Results
ICE''s fourth quarter 2007 consolidated revenues increased 67% to $159.3 million compared to $95.3 million in the fourth quarter of 2006. Consolidated transaction fee revenues increased 60% to $132.6 million in the fourth quarter of 2007, from $82.8 million in the fourth quarter of 2006. The increase in transaction revenue was driven primarily by the addition of ICE Futures U.S. and implementation of electronic trading in its markets, new products, strong trading volume in the futures and global OTC business segments, and the entry of new participants in ICE''s markets.
Transaction fee revenues in ICE''s futures business segment, comprising ICE Futures Europe, ICE Futures U.S. and ICE Futures Canada, totaled $72.4 million in the fourth quarter of 2007, an increase of 92% over $37.7 million in the same period in 2006.
In the fourth quarter of 2007, ICE''s European futures business recorded volume of 35.8 million contracts. ADV for ICE''s European futures business rose 25% to 550,175 contracts compared to the fourth quarter of 2006. At ICE''s North American futures businesses, ICE Futures U.S. and ICE Futures Canada recorded total volume for the fourth quarter of 12.5 million contracts and 1.1 million contracts, respectively. ADV for ICE Futures U.S. was 201,640 contracts in the fourth quarter of 2007, a 26% increase compared to the same period in 2006. ADV for ICE Futures Canada was 17,347 contracts during the quarter, a 25% increase compared to the year-ago period.
Fourth quarter 2007 transaction fee revenues in the OTC business segment increased 33% to $60.2 million, compared to $45.1 million in the same period in 2006. Average daily commissions increased 28% to a record $912,967, compared to $712,191 in the fourth quarter of 2006. Average daily commissions reflect daily trading activity in the company''s OTC markets. Cleared contracts accounted for 83% of OTC contract volume during the fourth quarter of 2007.