Summary of TMX Group FY Conference Call - September 08, 2025 Company Overview - **Company**: TMX Group (OTCPK:TMXX.F) - **Industry**: Financial Services, specifically focusing on exchanges, asset management, and trading. Key Points Macro Environment and Market Performance - Global uncertainty and interest rate outlook are driving elevated trading volumes across TMX's marketplaces, with open interest growth of approximately **60% year-to-date** on the Montreal Exchange [2][3] - Equity volumes have increased by **14% year-over-year**, indicating strong market activity [2] IPO Market and Listings - There are signs of a global resurgence in IPO activity, with Canada traditionally following the US market trends [4] - The current IPO pipeline is robust and diverse, with over **50%** of the pipeline consisting of companies outside Canada, particularly in the innovation sector [5][6] Trading Business and Derivatives - TMX has seen strong growth in Canadian derivatives, particularly in longer-term contracts, with the two-year and five-year contracts showing growth rates of approximately **27%** and **30%** respectively [11] - The company categorizes its derivatives trading and clearing business as a strong grower, with a **CAGR of about 11%** over the last ten years [10] Technology and Innovation - TMX launched a new ATS in the US, which has shown solid trading volume growth, leveraging in-house technology from both the Montreal and Toronto Exchanges [12][14] - The company is exploring opportunities to port this technology back to Canada to enhance existing trading platforms [16][17] Post-Trade Modernization - TMX's post-trade modernization project has successfully gone live, allowing for the introduction of new products like SGC Notes and CCMS, which are expected to generate meaningful revenue moving into 2026 [21][22] Global Insights and Trayport - The Trayport business is experiencing strong growth driven by client renewals and geographic expansion, particularly in Japan and the US [24][29] - TMX added **82 new client logos** in the last year and a half, indicating ongoing market expansion [25] ETF Growth and Vedify - ETFs are one of the fastest-growing subsectors in asset management, with Vedify focusing on creating bespoke indices and launching ETFs based on client needs [36][37] - Vedify has been growing at a pro forma basis of **15%** since its acquisition, indicating strong performance [40] M&A Strategy - TMX is open to pursuing acquisitions that align with its growth strategy, with a focus on maintaining a leverage ratio within the target range of **1.5 to 2.5 times** [56][58] - The company is interested in both small tuck-in acquisitions and larger, more impactful acquisitions if they align with strategic goals [62] Digital Assets and Market Trends - TMX is monitoring the evolving landscape of digital assets and tokenization, with a cautious approach based on regulatory developments in the US [63][64] - The company is prepared to support Canadian banks in meeting client demand for crypto-related services, contingent on market conditions [66] Retail Engagement - Canadian retail investors are generally more conservative compared to their US counterparts, with limited engagement in options trading [72] - TMX is willing to create markets if there is sufficient demand, indicating a responsive approach to market needs [74] Data Links and Revenue Growth - Data Links is experiencing growth driven by increased demand for colocation services and cross-selling opportunities following the acquisition of Vedify [75][76] - The company is exploring additional datasets to complement its trading data, aiming to enhance the quality and value of its offerings [78][79] Conclusion TMX Group is navigating a complex macroeconomic environment while capitalizing on growth opportunities in trading, technology, and asset management. The company is focused on innovation, strategic acquisitions, and responding to market demands, positioning itself for continued success in the financial services industry.

TMX Group (TMXX.F) 2025 Conference Summary Company Overview - **Company**: TMX Group - **Date**: September 03, 2025 - **Speaker**: John McKenzie, CEO Key Points Strategic Vision and Growth - TMX Group's strategy includes the **Core Plus Four** approach, focusing on core business reinvestment and identifying four growth vehicles: beyond listings, beyond borders, beyond data, and beyond traders [4][5] - The company reported an **18% year-over-year growth** for the first half of the year, with **16% organic growth**, despite a turbulent capital market [6] - The **TM2X vision** aims to change the growth paradigm, focusing on doubling the franchise rather than incremental growth [7] Market Conditions and Government Initiatives - The Canadian government is taking measures to improve the investment climate, which is expected to benefit TMX Group, especially in capital raising for companies [10][11] - TMX has proposed six strategies for capital market reforms, with one successful reform being the equalization of R&D tax credits for public and private companies [12][13] Growth Initiatives and Execution - TMX is focused on **growing its core business** and executing large-scale initiatives, including a **seven-year post-trade modernization program** and the launch of a U.S. ATS [14][15] - The U.S. ATS has seen a **300% increase** in activity in the second quarter compared to the first quarter, indicating strong market reception [70][71] Global Insights and Competitive Advantage - The **Global Insights portfolio** is crucial for TMX's resilience, with a focus on proprietary data and integrated SaaS solutions [20][21] - TMX aims to grow its data links business and enhance its analytics capabilities, with a target of increasing the share of higher-margin data business to **50%** of total revenue [47][48] Trayport and Market Expansion - Trayport is identified as a major growth engine, with plans to expand into the **Japanese power market**, which is comparable in size to France and Germany combined [34] - The company is also exploring opportunities in other regions, including Australia, New Zealand, and South America [36] Digital Assets and Innovation - TMX is preparing for digital assets but emphasizes that current digital securities are already fully digital through existing infrastructure [52][53] - The company is focused on being **token-ready** and exploring how digital assets can create liquidity events for private companies [56][57] Derivatives Market Growth - TMX has launched new futures products and is focusing on enhancing liquidity through revenue-sharing regimes [59][60] - The company plans to introduce credit futures and expand its OTC programs to improve capital efficiency [62][63] M&A Strategy - TMX's M&A strategy is centered on accelerating its core fundamentals, particularly in data and insights [73] - The company is actively looking for acquisitions that can enhance its capabilities in the ETF market, which is robust in Canada [75][76] Valuation and Investor Outlook - TMX acknowledges its historical valuation discount but believes it should trade at a premium due to its growth potential and recurring revenue mix [79][80] - The company aims to continue delivering on its growth promises to justify a premium valuation compared to peers [81][82] Additional Insights - The company is focused on **operating leverage** by growing higher-margin data businesses and improving lower-margin segments [50][51] - TMX is committed to nurturing its proprietary networks and enhancing customer relationships to maintain competitive advantages [24][29] This summary encapsulates the key insights and strategic directions discussed during the TMX Group conference, highlighting the company's growth initiatives, market conditions, and future outlook.

TMX Group (TMXX.F) FY Conference Summary Company Overview - TMX Group operates key global markets, clearinghouses, and data analytics platforms within the capital market space [1][2] Core Industry Insights - Over 40% of TMX Group's revenues are derived from Global Insights, with aspirations to exceed 50% in the long term [6][8] - The company aims to grow recurring revenue to more than two-thirds of total revenue [7] - TMX Group is focused on expanding revenue outside of Canada while maintaining its core Canadian operations [7][8] Global Insights Strategy - Global Insights includes businesses like Trayport, TMX Verify, and TMX DataLinks, which are expected to grow at high single to double-digit rates [8] - TMX Verify has been performing well, consistently meeting high growth expectations since its acquisition [12][13] - The ETF market is experiencing significant growth, with TMX Verify positioned to leverage this trend [14][17] TMX Verify Performance - TMX Verify has successfully addressed client needs for custom index and benchmark capabilities, particularly in the U.S. and Canada [11][12] - The digital distribution network of TMX Verify is crucial for helping investment managers gain traction [20][22] - Recent acquisitions in Europe, including Index Research and ETF Stream, are expected to enhance TMX Verify's capabilities and market presence [25][27] Trayport Overview - Trayport serves as a digital trading platform for brokers and traders, facilitating price discovery and trade execution across various asset classes [30][31] - Subscriber growth remains strong, with significant expansion into the U.S. and Japan markets [34][35] - The addition of premium services like charting and analytics is driving further growth for Trayport [36] Derivatives Market Insights - The Montreal Exchange has seen a growth rate of 17% in 2024, with expectations for continued growth despite recent volatility [39][41] - The company is developing new products to sustain growth in the derivatives market [40] Tokenization and Digital Assets - TMX Group is monitoring developments in tokenization and digital assets, with plans to adopt these technologies as market structures evolve [42][44] - The company aims to be a fast follower in Canada, leveraging its clearinghouses for security and robustness in the tokenization process [47][48] U.S. ATS Development - The U.S. ATS is focused on enhancing order execution quality, with ongoing discussions about expanding features based on client feedback [50][52] IPO Market Outlook - The IPO market is currently experiencing cyclical lows, but TMX Group anticipates a recovery aligned with U.S. market trends [54][56] - The company has diversified its business, achieving record results despite low capital formation activity [59][60] Conclusion - TMX Group is strategically positioned for growth through its diversified offerings, focus on recurring revenue, and expansion into new markets and technologies. The company remains optimistic about future opportunities in both the domestic and international capital markets.