CME Group Inc (NASDAQ:CME) managed to overcome the uncertainties brought about by the coronavirus pandemic in 2020, delivering strong results and impressive growth during the year.
The company’s latest earnings report revealed that it generated $1.1 billion in revenue in 4Q2020 and $4.9 billion for the full year. The impressive revenue figures were backed by strong international volumes during the year and especially in Q4 in which it delivered double digit growth YOY. The global markets firm reported an average daily volume of 16.2 million contracts in 4Q2020 while the non-U.S ADV for the entire year was 5.3 million contracts.
"As the ongoing global pandemic created an environment of extreme uncertainty and market volatility, we remained highly focused on helping our clients manage risk that was impacting their businesses," noted CME Group CEO, Terry Duffy.
Transaction and clearing fees accounted or the bulk of CME’s revenue in 4Q2020 at $843 million at $0.699 average rate for each contract. The company also generated $140 million market data rvenue during the entire year. The CEO also attributed CME’s strong performance in 2020 to impressive growth from its agricultural and equity index businesses. The growth also contributed significantly to the company’s ability to overcome the tough economic conditions brought about by the global pandemic.
What to expect from CME Group moving forward
Analysts expect market performance to be livelier in 2021 as business recovery continues across the globe continues to gain traction and ease off the pandemic-induced economic slump. Analysts anticipate a boost in investor confidence courtesy of the economic recovery which is supported by coronavirus vaccine rollouts.
CME is also doing its part to tap into growth opportunities that will pop up in 2021. For example, Mr. Duffy announced that the company finalized the transition of its BrokerTec business to CME Globex, a move that is expected to generate cost efficiencies and more value for customers. The value will be unlocked in the form of access to the cash and repo markets, as well as the listed derivatives market in the same platform. The global markets firm plans to roll out more offerings within the year, to cater to client needs.