Heavier Trade Volumes Lift ICE 4Q Profit

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Led by higher trade volumes on its futures market, IntercontinentalExchange (NYSE:ICE) posted record earnings and sales in the fourth-quarter, lifting its profit ahead of Wall Street expectations.

The Atlanta-based company reported net income of $99.1 million, or $1.34 a share, compared with $84.3 million, or $1.13 a share, in the same quarter last year.

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Excluding one-time items, the company earned $1.35 a share, edging ahead of average analyst estimates polled by Thomson Reuters of $1.33.

Revenue for the operator of futures exchange and over-the-counter markets and derivatives clearing houses was $285 million, up from $256.5 million a year ago, beating the Street’s view of $283 million.

“Once again in 2010, we delivered record revenues and earnings,” ICE chief financial officer Scott Hill said in a statement. “The strength in our commodities business continues into 2011, and we continue to expand our trading, clearing and processing services for market participants world-wide.

Earnings were fueled by higher transaction and clearing fee revenues, due primarily to strong trading volume in ICE’s future segment, new products and growth in its credit default swaps clearing business. Transaction and clearing fee revenues in the futures segment totaled $127 million, up 24% from $ 102 million in the year-earlier period.

Partially offsetting the results were lower global transaction and clearing fee revenues, down slightly to $125 million from $127 million a year ago.

ICE, which had 933 employees as of Dec. 31, is expected to increase its headcount by 6% to 10% this year excluding acquisition activity. It anticipates its CDS clearing revenues to increase 15% to 20% over 2010 revenues.

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