CBOE Profit Exceeds Estimates Amid Growth in VIX, S&P Products

CBOE Holdings Inc. (CBOE), the biggest U.S. options market by volume, reported first-quarter profit that beat analyst projections amid growth in its volatility and Standard & Poor’s 500 Index products.

Net income increased 27 percent to $41.8 million, the Chicago-based company said today in a statement. Earnings excluding some items were 50 cents a share, exceeding the 47- cent average estimate of 15 analysts surveyed by Bloomberg whose estimates ranged from 49 cents to 45 cents.

CBOE is working to boost revenue amid a drop in volume and increasing competition in the listed options market in the U.S., where there are now 11 exchanges. Options trading slowed to a daily average of 15.9 million contracts last year from a ninth- consecutive record of 18.1 million in 2011, data from the Chicago-based OCC show. So far in 2013, it has averaged 16.6 million.

The stock rose 0.6 percent to $37.51 yesterday in New York and it has gained 27 percent in 2013. The Bloomberg World Exchanges Index, which includes CBOE and 25 of its peers, has gained 13 percent this year.

Volume of options on CBOE’s volatility measure, known as the VIX (VIX), have climbed to a daily average of more than 610,000 this year, a 37 percent increase from 2012, according to data compiled by Bloomberg. Almost 810,000 S&P 500 options traded each day in 2013 on average, up 15 percent from last year. CBOE is the exclusive venue for options based on the volatility measure and the S&P 500 Index. (SPX)

To contact the reporter on this story: Nikolaj Gammeltoft in New York at ngammeltoft@bloomberg.net

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net

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