FMX | Connect – www.fmxconnect.com - (Reported 5/04/2010)

We expect ICE to report 1Q10 EPS of $1.31, 1c below consensus estimates of $1.32, on revenues of $278m vs consensus’ $279m, and operating expenses of $119m vs consensus’ $122m.

ICE agreed to acquire CLE for £395m ($604m) in cash, or GBp750 per share, implying a 56.9% premium to the 29-April closing price (GBp478). ICE expects the deal to be slightly dilutive to earnings in 2010 and accretive in 2011.

We expect the deal to increase ICE share value between 4%-8%.

ECX volumes continue to grow in April while CCFE and CCX volumes plunged

Volumes

· Energy Futures ADV is averaging 937k contracts during April, +65% y/y and +11% from 1Q10.

· Agricultural Futures ADV is averaging 289k contracts during April, +13% y/y and +5% from 1Q10.

· Financial Futures ADV is averaging 146k contracts during April, +2% y/y and -6% from 1Q10.

· CDS Clearing run rate is $936b during April, +19% from 1Q10; with SN CDS increasing +173% from 1Q10 and Index CDS decreasing -1% from 1Q10.

· Energy OTC ADC is averaging $1.13m during April according to ERD OTC Prediction Model, flat from 2Q09 and -18% from 1Q10. An active hurricane season expected by Colorado State University will drive ADC higher.

OTC Energy – 34% of 4Q09 revenues

· OTC Energy ADC is tracking at $1.13m during April, -16% from 1Q10 and +2% from 2Q09.

We expect ADC to increase due to the 2010 Atlantic hurricane season (as expected by the Colorado State University

CDS – 15% of 3Q09 revenues

· CDS transaction volume has been decreasing since ICE bought the Creditex at the end of 2008 as it switches tradin to electronic venues.

· ICE expects CDS clearing revenues to be $60m-$80m for 2010 (1Q10 run rate is about $40m) and net income margin to be 16%-20%.

· CDS clearing OI has been increasing steadily since the Mar-09 launch, but it has accelerated since Dec-09 when SN CDS were introduced.

· ICE plans to increase SN CDS coverage by mid May to 85% of iTraxx and 60% of CDX constituents during 1H10.

ICE Futures Europe (Energy) – 26% of 4Q09 revenues

· Energy volume is averaging 937k contracts during April, +65% y/y and +12% m/m

ICE Futures North America (Agricultural & Financial) – 13% of 4Q09 revenues

· We expect NA Futures to increase its revenue share after the expiration of Currency fee waiver on Jan-10

· Agricultural volume is averaging 266k contracts during April, +13% y/y +14% m/m

· The Russell 1000 Growth and Value Indexes Futures will begin trading on 3-May-2010.

· Financial Futures volume is averaging 164k contracts during April, +2% y/y -19% m/m.

RPC

· Bundled RPC has been stable at a $1.5-$1.6 range for the past year

· Energy RPC has been stable at a $1.5-$1.6 range after introducing ICE Clear Europe

· Agricultural RPC has stabilized in the last two quarters at around $2.1 after decreasing from a peak of $2.3 in 1Q09

· Financial RPC increased during 1Q10 after the expiration of Currency fee waivers on Jan-10.

Provided By: Equity Research Desk, www.erdesk.com