CME Group(CME) - 2024 Q4 - Annual Report

Financial Performance - Total revenues for 2024 reached $6,130.1 million, an increase of 9.8$5,578.9 million in 2023[333]. - Net income for 2024 was $3,525.8 million, up 9.3$3,226.2 million in 2023[335]. - Earnings per share attributable to common shareholders increased to $9.69 in 2024, a rise of 9.3$8.87 in 2023[333]. - Operating income for 2024 was $3,931.5 million, representing a 14.5$3,435.7 million in 2023[333]. - Comprehensive income for 2024 was $3,475.9 million, an increase from$3,303.9 million in 2023, reflecting a growth of 5.2%[335]. - Cash provided by operating activities for 2024 was $3,690.5 million, compared to$3,453.8 million in 2023, reflecting a growth of 6.8%[347]. - Cash dividends declared for 2024 were $3,584.2 million, an increase from$3,235.5 million in 2023[349]. - Total revenues for 2024 reached $6,130.1 million, an increase of 9.8$5,578.9 million in 2023[391]. - Clearing and transaction fees totaled $4,988.2 million in 2024, up from$4,588.5 million in 2023, reflecting a growth of 8.7%[391]. - Interest rates revenue increased to $1,659.6 million in 2024, a rise of 6.5$1,558.4 million in 2023[391]. - Market data revenue grew to $710.2 million in 2024, representing an increase of 7.0$663.7 million in 2023[391]. Assets and Liabilities - Total assets as of December 31, 2024, were $137,447.0 million, compared to$129,706.1 million in 2023, reflecting a growth of 5.3%[331]. - Total liabilities increased to $110,960.1 million in 2024, up from$102,968.2 million in 2023, marking a rise of 7.7%[331]. - Total cash, cash equivalents, and restricted cash at the end of 2024 amounted to $101,794.1 million, up from$93,109.7 million at the end of 2023[349]. - The balance of accumulated other comprehensive income (loss) was $(105.5) million at the end of 2024, compared to$(55.6) million at the end of 2023[344]. - The balance of contract liabilities was $15.6 million as of December 31, 2024, compared to$13.2 million in 2023[391]. - Cash performance bonds increased to $96,036.4 million in 2024 from$87,285.5 million in 2023, representing an increase of 10.0%[407]. - Total letters of credit decreased to $7,760.7 million in 2024 from$8,548.1 million in 2023, a decline of 9.2%[410]. - The net book value of property decreased to $386.2 million in 2024 from$409.5 million in 2023, a decrease of 5.7%[411]. - The carrying amount of the company's investment in GME Holdings was $11.6 million at December 31, 2024, following a net gain of$9.2 million from a share transaction[417]. - The carrying amount of the company's investment in OSTTRA was $1.2 billion at December 31, 2024[418]. Debt and Credit Facilities - The company's long-term debt is rated investment grade by two major rating agencies, with a current outstanding amount of$3.4 billion[168][307]. - The company maintains a $7.0 billion multi-currency line of credit, with the option to increase it to$10.0 billion, to provide liquidity in case of clearing firm defaults[313]. - Long-term debt outstanding decreased to $2,678.2 million in 2024 from$3,425.4 million in 2023, a reduction of 22.0%[423]. - The company has a committed facility of up to $750.0 million for foreign currency conversions, which is subject to annual renewal[315]. - The company maintains a 364-day multi-currency line of credit of up to$7.0 billion, with $10.1 billion in guaranty fund contributions available to collateralize the facility[403]. - CME has a committed facility of up to$750.0 million for foreign currency conversions, currently with no outstanding trades under this facility[405]. Expenses and Compensation - Compensation and benefits expenses rose to $850.3 million in 2024, a slight increase from$828.6 million in 2023[333]. - Stock-based compensation for 2024 was $89.5 million, slightly higher than$82.9 million in 2023[347]. - The total compensation expense for stock-related awards in 2024 was $90.4 million, an increase from$83.7 million in 2023[477]. - The total unrecognized compensation expense related to employee stock-based compensation arrangements as of December 31, 2024, was $139.6 million, expected to be recognized over a weighted average period of 2.2 years[477]. - Aggregate expenses for defined contribution savings plans amounted to$20.8 million in 2024, up from $19.7 million in 2023 and$18.3 million in 2022[444]. Taxation - Income before income taxes for 2024 was $4,541.4 million, an increase of 9.3$4,153.6 million in 2023[426]. - The total income tax provision for 2024 was $1,015.6 million, up from$927.4 million in 2023, reflecting a 9.5% increase[426]. - The effective tax rate for 2024 was 22.4%, slightly higher than 22.3% in 2023[426]. - Deferred income tax assets increased to $142.0 million in 2024 from$134.4 million in 2023[428]. - The company reported gross unrecognized tax benefits of $251.6 million in 2024, a decrease from$264.1 million in 2023[430]. Pension and Employee Benefits - The balance of the projected benefit obligation for the pension plan increased to $364.0 million in 2024 from$351.5 million in 2023[434]. - The fair value of pension plan assets rose to $367.5 million in 2024, exceeding the pension benefit obligation by$3.5 million[436]. - The net pension expense for 2024 was $17.0 million, compared to$18.3 million in 2023[438]. - The discount rate used to determine the end-of-year projected benefit obligation increased to 5.70% in 2024 from 5.20% in 2023[438]. - The asset allocation for the pension plan as of December 31, 2024, was 45.7% in fixed income, 4.3% in money market funds, 37.4% in U.S. equity, and 12.6% in foreign equity[440]. - The actuarial loss balance for the pension plan decreased from $33.0 million at the beginning of 2024 to$20.8 million by the end of the year[443]. - Anticipated benefit payments from the pension plan for 2025 are projected at $34.9 million, increasing to$38.4 million by 2029, with total payments of $196.2 million expected from 2030 to 2034[443]. Market Data and Trading - In 2024, 85$291.5 billion as of December 31, 2024, which includes cash and non-cash deposits[316]. - The average rate per contract for the derivatives business is subject to fluctuations, making it difficult to predict future rates[169]. - Revenue from clearing and transaction fees is recognized upon successful execution of trades, with minimal remaining revenue recognized over the short-term period[386]. - Market data and information services revenue is recognized monthly as customers receive and consume the benefit of the services[389]. Shareholder Information - The company has authorized a share repurchase program of up to $3 billion for Class A common stock, with no shares repurchased as of December 31, 2024[474]. - As of December 31, 2024, there were 1,087,358 shares of restricted stock and restricted stock units outstanding, with a weighted average grant date fair value of$219[479]. - The total fair value of restricted stock, restricted stock units, and performance shares that vested in 2024 was $61.4 million[480]. - The Employee Stock Purchase Plan (ESPP) allowed employees to purchase 37,466 shares of Class A common stock in 2024, with an annual expense of$0.8 million recognized for the purchase discount[481]. - As of December 31, 2024, CME Group has approximately 4.6 million shares of Series G Non-Voting Convertible Preferred Stock outstanding, which is convertible into Class A common stock at a 1:1 rate[463].