TMX Dividend Policy

7/31/2019 TMX Dividend Policy

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Chris Royle (R) (209716754)Gavin Yi (R) (209641788)Tang Vu (S) (209658493)

Alexandru Zaharia (R) (209601691)

FINE 3100

To: Professor K. Chiykowski

24 March 2011

TMX Group Dividend Policy


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Contents

Executive Summary ................................................................................................................................................................ 3

The Security Exchange Industry........................................................................................................................................ 5

Operating Strategies of TMX Group (as compared to NYSE Euronext and NASDAQ OMX Group) ....... 6

Growth Strategies of TMX Group (as compared to NYSE Euronext and NASDAQ OMX Group) ............ 7

Industry Trends in Dividend & Share Repurchase Policies ................................................................................... 7Key Factors Affecting Dividend Policies......................................................................................................................... 9

Recommendation ................................................................................................................................................................... 11

Works Cited .............................................................................................................................................................................. 13


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Executive Summary

TMX Group is a multi-asset class exchange group operating the issuance, trading and

clearing of various Canadian asset markets, and providing market data internationally. The

industry is highly regulated and improvements in trading technologies make it increasingly

competitive. TMX is primarily focused on Canadian markets over which it holds a first mover

advantage. However, changes in regulations, technological developments and the recent trend

towards globalization in the security exchange industry have led to intense price competition

and decreased market share of TMX. As the industry matures, firms have exploited M&A activity

in an attempt to increase revenues through cost savings and synergies. Furthermore, a desire

to expand geographically to emerging markets has caused a wave of consolidation across

international borders. Given the high competition it is faced with, TMX plans to continue

providing innovative trading platforms and products while at the same time pursuing a growth

strategy based upon horizontal, vertical, and international expansion and diversification through

M&A activity.

Dividend policy, share repurchase, and capital expenditure practices vary across the

industry. TMX has the second highest 12-month dividend yield (4.11%); however, its CAGR

(9.13%) is the lowest compared to its competitors. Many competitors have constant dividend

payout policy, keeping little cash on hand and using credit facilities to finance the payout. Share

repurchase policy also varies, although it is most common for firms to buy back 2-5% of

outstanding shares in recent years. TMX finances share repurchases and dividends through

short-term loans or cash on hand. However, its current credit availability is low and it lacks cash

compared to its peers. Under current conditions, TMX is unlikely to create value for its

shareholders through stock splits. TMX enjoys a minimal positive revenue growth despite the

negative trend in the industry allowing the company to invest more than the industry norm. This

explains why TMXs dividend growthhas lagged behind the industrys 5-year CAGR, yet its 12


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month dividend yield is the highest among its peers. High presence of institutional ownership in

the industry and the mature industry stage has led to high constant payout ratio, especially with

excess cash on the balance sheet. However, TMX and NYSE are the only firms with residual

dividend policy.

Based on the investors profiles of TMX, which include largely institutional investors

(76.29%) with low ownership turnover, it is recommended that TMX meets their needs by

growing the dividend towards the industry average of 13.29%. However, TMXs lack of long-

term debt, lower than average receivable turnover ratio, and thus low cash balances available

inhibit dividend growth. Hence, it is recommended to increase the current dividend of $1.52 to

$2 dividend per share in 2011. This would also signal managements confidence in its ability to

meet this level of dividend in the future. This approach provides a middle ground between the

TMXs capital expenditure needs and value investors preference for dividends. Finally, to allow

investors to manage future expectations, we recommend continuing with the share repurchase

program at the current level.


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The Security Exchange Industry

TMX Group operates in the highly regulated North American security exchange industry,

in which revenues are driven by the volumes of assets traded, the number and market

capitalization of issuers, and the number of subscribers to market data.1

Technology has caused increased industry competition due to new trading mechanisms such as

Alternative Trading Systems (ATS) and Electronic Communication Networks.2 ATS gained

regulatory approval in 2001 and are subject to less oversight and thus more responsive to

competitive pressures.3 Many of these run without profit motives or offer cheaper trading rates

due to technological efficiency gains and have caused intense price competition and taken

market share from traditional exchanges.4 For example, in December 2009 TMX traded only

73% of Canadian volume compared to its virtual monopoly of 96% in December 2008.5

A consolidation wave is taking place within the market as individual national exchanges attempt

to seek opportunities internationally and attempt to offset losses from price competition with

ATS through increased market share.6 With largely fixed cost bases, security exchange firms

realize revenue gains from M&A through increases in volume as well as cost efficiencies due to

the sharing of a single technology platform for example.7 These consolidated companies hope

to better compete for listings in emerging markets, while offering a broader range of financial

services and investment destinations to investors.8


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Operating Strategies of TMX Group

(as compared to NYSE Euronext and NASDAQ OMX Group)

Similar to its competitors, TMX is primarily involved in the trading of various asset

classes. In particular it provides electronic trading venues for the trading execution and

settlement of transactions, clearing and issuance of cash, derivatives, and energy securities,

and also produces market information services (Appendix 2&3).9 Within the IT segment, NYSE

provides a more differentiated and value-added service than TMX by operating sellside and

buyside connectivity networks, providing trading & IT software solutions to the customers.10

NASDAQ is best known for providing premier electronic trading platforms for equities,

derivatives and commodities, which support the operations of over 70 exchanges, clearing

organizations and central securities depositories in more than 50 countries. TMX has also

developed trading platforms, however to a more limited degree; its SOLA electronic trading

platform for derivative trading for example, is used only by a few European exchanges.11 In its

cash markets, TMX operates both a junior market, the TSX Venture Exchange, and a senior

market, the TSX, to which many small-cap Venture Exchange companies graduate. Its

competitors deal more with senior markets. TMX primarily operates in Canada, with a portfolio

of listings that is highly based in SME and natural resource companies (Appendix 3.1), while its

competitors are significantly more diversified, both in listings and in geographic operations

across the US and Europe. The international nature of its competitors, such as NYSEs position

as the first integrated cross-border exchange, is a source of competitiveness over TMX. TMX

Group is also significantly smaller than the NYSE and NASDAQ, both in revenues and market

capitalization (Appendix 2). However, in recent years, TMX has focused on increasing its

geographic diversification, cross- listing with Brazils BOVESPA since 2006, listing American

companies since 2007, and signing Memorandums of Understanding with the Oslo Bors and Tel

Aviv Stock Exchange in 2010 that will explore dual listings.12 In 2011, it will introduce TMX


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Select, a new system that will operate on its TMX Quantum trading platform and help it compete

internationally due to expanded trading hours. Please refer to Appendix 1 and 2 for

organizational structures anddetailed description of business operations.

Growth Strategies of TMX Group

(as compared to NYSE Euronext and NASDAQ OMX Group)

From a growth strategy perspective, TMX plans to expand horizontally, vertically and

geographically while focusing on its areas of comparative advantage: SMEs and natural

resource companies, as well as its technological initiatives. While its competitors are already

significantly more diversified, the current wave of consolidation is indicative of their desire to

improve global connectivity. Given high competition from electronic trading platforms and ATS

which have taken market share, all three companies seek to engage in M&A activity to further

diversify and realize synergies and cost savings that would improve revenues. As the industry

becomes increasingly technology based, all firms strive to enhance their trading platforms and

technology infrastructure, as well as to offer new and innovative trading products and platforms

that will increase their market share. Please refer to Appendix 3 for detailed description of

strategies.

Industry Trends in Dividend & Share Repurchase Policies

Due to increasing global competition among international securities exchanges, it is

appropriate to examine TMX dividend policy, share repurchase and capital expenditure

practices relative to a group of representative global peers. This group will include NYSE

Euronext, NASDAQ OMX, LSE Group, MF Global, Intercontinental Exchange (ICE), ASX,

CBOE, CME Group and Deutsche Boerse (Appendix 14). Among these dominant players, the

aforementioned practices vary greatly. Over the last 5 years, most firms have paid regular and

increasing dividends: quarterly for North American firms and bi-annually for the ASX, DB and


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LSE. However, firms such as NASDAQ OMX, MF Global and ICE currently are not paying any

dividend and do not plan to do so in the foreseeable future 12-month dividend yield and 5-year

dividend CAGR for these competitors are 2.42% and 13.29% respectively. Relative to these

figures, TMX has the second highest 12-month dividend yield of 4.11%, only after ASXs 7.14%.

However, its dividend compound annual growth rate is the lowest compared to industry average

at 9.13%.

Although many of these companies have a constant dividend payout policy, they tend to keep

little cash on hand (Appendix 5), often utilizing credit facilities to finance dividend payouts. CME

announced in 2011 that it would improve its dividend policy payout ratio from .3 to .35 while

Deutsche Boerse is maintaining a wider range of .4 to .6. Considering the recent inception of

CBOE in 2010, its most recent dividend payout of $.1 per share could simply be a signal that its

stocks are an attractive investment and expected earnings can sustain that particular level of

payment in the future. On the other hand, NYSE uses a residual policy that largely depends on

its board members approval.

The practice of returning excess capital to investors through shares repurchase programs also

varies. While firms such as DB, LSE and CME have increasingly attractive tender offers and

return of capital, ASX and MF Global do not engage in shares repurchases. This can be

explained by ASX highs payout ratio of 90% after-tax earnings, for example. On the other hand,

MF Global, which has the smallest market capitalization among its peers, cannot afford

dividends and shares repurchase due to specific creditors covenants. Overall, it is typical for

firms in the industry to buy back 2-5% of outstanding shares issued during the course of the

year (Appendix 7). However, this amount can fluctuate greatly at the discretion of board

members due to economic conditions and available growth opportunities. In the case of TMX,

shares repurchase and dividends are financed by short-term loans and/or cash on hand since

its capital structure essentially includes only equity and short-term loans with limited long-term

debt of 0.17% (Appendix 12). To date, TMX has fully used up its non-revolving and revolving


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three year term facility totalling $480 million due in April 2011. With roughly $473 million of credit

available and approximately $70 million of cash on hand, TMX is low on cash, in absolute

values, compared to its peers (Appendix 5). Furthermore, with a relatively small EBITDA of only

$321 million and a debt capacity topped at 3.5x its EBITDA due to a covenant imposed by the

credit facilities, it is difficult for TMX whose market capitalization is only $2.8 billion to grow its

dividend and increase its shares repurchase to the industry level. The firm did reward its

investors with a 2-for-1 stock split in May 2005 to allow a price level breakthrough. However,

considering the contracting industry growth in revenue and EBITDA (Appendix 8) and

undervalued stocks signalled by two of LSEs stocks consolidations in the past 7 years, it is

unlikely that TMX can create values for its investors with another stock split.

Key Factors Affecting Dividend Policies

To understand the diverging practices in creating value for investors in this industry, it is

important to understand other factors that determine how a firm returns value to its investors.

Despite industry contraction in revenue and EBITDA, TMX is one of the only two companies

with positive growth. Along with its superior ability to generate revenue (Appendix 8), cash

outflows in investing versus amortization as a percentage of revenue indicate that TMX has

been investing more than the industry norm (Appendix 4). TMXs investing cash flows as

percentage of total assets is between 25-35% on a consistent basis. Most of its co mpetitors

investing cash flow is under 10%, but some have been highly volatile (Appendix 4). TMXs

persistent and aggressive approach to capitalize on growth opportunities explains why its

dividend has grown slower than the industry for the past 5 years, yet its 12-month dividend yield

is the highest among its peers. This also suggests that other firms with higher assets in place

and lower growth opportunities will tend to pay higher dividend or implement more shares

repurchase programs to reduce excess cash.


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Examining the cash balances of the companies would give insights into their cash availability for

shareholders. Such availability depends on liquidity requirements such as sufficient A/P

turnover, interest coverage as well as cash collection (Appendix 10). The overall industry is

experiencing an increase in the aforementioned cash disbursement requirements (both

operational and short term debt servicing) and a decrease in A/R turnover (Appendix 10).

Increasing demands on cash to fund working capital and short term financing are limiting the

amount of cash flows to investors which means less cash dividends payout and share

repurchase (Appendix 6). With the overall industry keeping cash as a proportion of the balance

sheet steady over the last five years (Appendix 5), the industry seems to be using its cash

balances more effectively than TMX in terms of servicing short term debt obligations and

operational needs. This factor also contributes to lowering TMXs dividend growth indicated by

its below-average 5-year dividend CAGR (Appendix 6).

There is a significant presence of institutional ownership within this industry. These investors

seek low-risk cash flows, which leads to firms declaring high constant payout ratios. The mature

life cycle stage of industry would explain the high payout ratio. Most of the firms experienced

plummeting EBITDA and revenue growth with the exception of TMX and CME (Appendix 8).

With high asset bases and lowering growth opportunities, the firms must return excess cash to

shareholders. Over the past 5 years, the industry trend is to increase dividends (Appendix 6).

CME has just announced that it will increase its payout ratio this year from 30% to 35% of cash

earnings. CME, DB and NYSE are three firms that grow their dividends aggressively,

surpassing the industry norm considerably (Appendix 6). It is not unusual for these firms to draw

on their credit facilities in addition to their cash reserves to pay dividends and repurchase

shares. With either approach, increasing capital return to investors signals the increase in ability

to generate cash flow and expectation to maintain their strong balance sheets. However, it is

important to note that companies gravitate toward increasing dividend to conform to industry

trend rather than the companys enhanced expectation of its ability to generate revenue. With


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most of the ten competitors using a constant payout ratio, TMX and NYSE are the only firms

that implement a residual dividend policy. NASDAQ and MF Global are currently paying no

dividend due to their covenant restrictions. ICE does not have any restrictive covenants but it

currently does not have dividend payments. Instead, its Board authorizes regular share

repurchase programs. A share repurchase program would be able to return capital to

shareholders without creating expectations of future cash flows as well as giving the investors a

choice to effectively manage tax implications. In 2009, investors received an additional $14.5

million through TMXs share repurchase program which put the program in line with the industry

practice.

Recommendation

Since 76.29% of all TMXs investors are institutional investors with low turnover, it is

advisable that TMX declares a dividend policy that meets their needs. TMXs investors have

varying needs: 50% are value investors; 9% are income and index investors; 41% are growth

and growth-at-reasonable-price (GARP) investors (Appendix 11). It is reasonable to assume

that growth and GARP investors are speculating to gain from possible M&A within the industry.

However, the majority is low-risk-cash-flow-seeking investors who value dividend payments.

With TMX having a high dividend yield but inferior 5-year CAGR, it is suggested that to meet the

industry level, it should attempt to grow its dividend closer to the industry average of 13.29% in

2011 (Appendix 6). An assumption must be made that all firms will continue with their current

dividend policies with 4 firms using constant payout ratio and 3 firms paying no dividend. Hence,

a $2.83 dividend per share is the recommended benchmark (See calculation in Appendix 13),

which must be adjusted by factors such as its operational and investment needs, credit facilities

covenants and the signalling effects on the market. Without the presence of long-term debt

covenants that place restrictions on dividend payout, the ability to grow dividends is at

managements discretion. However, lacking long-term debt means that all of TMXs operational


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and investment needs must be met by its credit facilities and internally generated cash funds.

Unlike its competitors whose cash balances can be augmented by larger credit facilities, TMX

has little room in its credit facilities to sustain a dividend of $2.83. Furthermore, its cash

balances are tied up operationally due to its lower-than-industry-average receivable and

turnover ratios. TMX has also been investing in assets more actively than its peers. Hence,

there is even less cash on hand to accommodate a dividend increase to meet the industry

CAGR. Lastly, one must consider the signalling effects entailing with a considerable increase in

dividend from the current dividend of $1.52. Such an increase will be interpreted as

managements optimism and confidence in the firms expected cash flows to meet this lev el of

dividend in the future. Considering the plummeting EBITDA and revenue growth in the industry

as well as uncertainty toward economic condition, it is highly risky to promise such high dividend

increase, and as such the signal will not be received as credible by investors.

Therefore, after taking into consideration the aforementioned, the adjusted dividend should be

$2.00 per share in 2011 and later on increase to meet the industrys 5-year dividend CAGR. It

will satisfy managements need for dividend smoothing. This approach would be a middle

ground between a constant payout ratio and a residual payout policy. The rationale is that a

constant payout ratio would hinder the firms ability to pursue growth opportunities but a residual

payout policy would not meet the value investors preference for dividend.

Finally, it is recommended that TMX should continue to implement its share repurchase

program at the current level in order to create value to investors, yet be able to manage future

expectation in terms of cash outflow to shareholders.


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Works Cited

Erman, B. et al. Global stock exchange consolidation may just be starting. The Globe and Mail.

Feb 9 2011.

Oslo Bors, Toronto Stock Exchange and TSX Venture Exchange sign Memorandum ofUnderstanding. TMX Group. Sep 20, 2010.

Toronto Stock Exchange and the Tel Aviv Stock Exchange Sign Memorandum ofUnderstanding. TMX Group. Feb 10, 2010.

TMX 2010 MD&A Report

1TMX Group Annual Report. P19. http://www.tmx.com/en/pdf/TMXGroup2009AnnualReport.pdf

2TMX Group Annual Report. P55 and 57. http://www.tmx.com/en/pdf/TMXGroup2009AnnualReport.pdf

3TMX Group Annual Report. P24 and 55. http://www.tmx.com/en/pdf/TMXGroup2009AnnualReport.pdf

4TMX Annual Report 2010

5TMX Annual Report 2010

6Global Stock Exchange Consolidation May Just Be Starting. The Globe and Mail. Feb 9 2011.

http://www.theglobeandmail.com/globe-investor/tmx-lse-agree-to-terms-on-merger/article1899965/7

TMX Group Annual Report. P19. http://www.tmx.com/en/pdf/TMXGroup2009AnnualReport.pdf8

Global Stock Exchange Consolidation May Just Be Starting. The Globe and Mail. Feb 9 2011.http://www.theglobeandmail.com/globe-investor/tmx-lse-agree-to-terms-on-merger/article1899965/9 TMX Group Annual Report 201010

Datamonitor Report. Company Profile, NYSE Euronext. p4 12 Jan 201111

TMX Annual Report 2010. P 2612

Datamonitor Report. Company Profile, TMX Group Inc.. p7 12 Jan 2011


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Appendix 1 Organizational Structures

Appendix 1.1 TMX Organizational Structure

Appendix 1.2 NYSE Euronext Organizational Structure


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Appendix 1.3 NASDAQ OMX Group Organizational Structure


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Appendix 2 Detailed Business Descriptions


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Canada

Canadian Derivatives ClearingCorporation (clearing, settlementand risk management)

BOX (US automated equityoptions market)

Montreal Climate Exchange(carbon dioxide futures)

Licensed SOLA (a derivativestrading technology) to LondonStock Exchange, and part owner

in the equity derivatives businessof the LSE

Data segment

Through TMX Datalinx offersCanadian market, fixed income,foreign exchange and corporatenews and data to investors6

Derivatives segment

Provides access to tradeexecution in derivativesproducts, options and futures;clearing services for derivativeproducts

Information services and technologysolutions segment

Operates sellside and buysideconnectivity networks

Provides trading and IT

software and solutions Provides multi-asset managed

services

Expert consultancy toexchanges and liquidity centers

creates information as adistributor of market data(flexible back-office systems)

Issuer services segment

Global listing services

Global index servicesMarket technology segment

Provides technology solutionsfor trading, clearing andsettlement, informationdissemination, offer facility

management integration andadvisory services.

Differences inoperations

TMX operates exclusivelythrough energy markets to tradenatural gases, electricity andcrude oil contracts

Most liquid cash equitiesexchange in the world based onaggregate market capitalizationof listed companies

The first integrated crossborder exchange (Amsterdam,Brussels, Lisbon, and Paris)

A marketplace designed forhigh performance trading ofthe most actively tradedEuropean stocks.

The first platform to connectEuropean liquidity pools

NASDAQ OMX Commoditiesoffers international derivativesand carbon products, and offersconsulting services tocommodities markets

Appendix 3 Business Strategies


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Business Strategies

TMX Group NYSE Euronext NASDAQ OMX Group Inc.

OperationalStrategy

Issuer services

Enhance premium brand,improve customer relationships,and continue to build loyalty

Diversify suite of products andservices offered to issuers

Equity Trading

Continue to improve technologyinfrastructure, so that TSX can

expand to meet growing demandfor reduced latency and expandedcapacity

Expand product and servicesofferings while maintainingcompetitive pricing

Identify new revenue sources introducing new trading productssuch as on-book dark order types

Fixed Income Trading7

Increase liquidity for both cashand futures markets and developlinkages between assets

Derivatives Trading and Clearing

Promote the strengths ofCanadian derivatives market:price transparency, liquidity andcentral counter party clearing

Broaden clearing service bypursuing opportunities in OTCmarkets

Leverage alliances withinternational partners

Energy

Implementing clearingenhancements to reduce customercapital costs

Cash Trading & Listing

Stabilize market share in theUS and Europe and implementnew European clearing strategy

Derivatives Trading

Focus on capturing marketgrowth in the U.S. optionsmarket and growth of clearingoperations

Eliminate dependence onoutsourcing (LCH) and buildnew clearing houses in Londonand Paris for clearingEuropean securities andderivatives

Information Services8

Enhance existing tradingplatforms and services(NYFIX, an expandingcustomer base improvessoftware sales)

Respond to customer demandsand technological advances on

a cost-effective and timelybasis

Seek to provide acomprehensive suite of best-in-class technology solutions in acentralized environment(transitioning to UniversalTrading Platform)

Continue to attract and retainhighly skilled technology staffto maintain, develop, andinnovate technology

Market Services

Provide customers withenhanced trading choices andprice flexibility (NASDAQOMX BX)

Outsource from third party forregulatory, data center andother services (FINRAperforms certain regulatory

functions on our behalf) Increase liquidity and trading

efficiency by introducingCentral Counterpart Clearing(CCP)

Consolidate all derivativestrading from EDX to Nordicderivative trading platformincrease membership by 60%

Issuer Services

Provide innovative productsand services that easetransparency, mitigate risk, andmaximize board efficiency

Market technology Continue to expand the

application of the U.S. INETtrading system (launchingNASDAQ OMX PSX, a newcash equity trading platform)

Continue to attract and retainkey personnel

Leverage technologicalcapabilities by providingsupport to over 70 exchanges,clearing organizations andcentral securities depositories


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Expand/enter into new marketsby adding additional points ofdistribution

Information Services

Provide low latency consolidateddata-feeds, co-location and datadelivery solutions.

in more than 50 countries.

Growth/AcquisitionStrategy

Grow business horizontally,vertically and geographically.

Horizontally expands into newasset classes and creates a larger

entity that can compete globally.Vertically expand existingofferings

Geographically expand beyondNorth America using strengths ofnatural resources, SMEs andtechnology9

Improve internal networks andstorage infrastructure10

Seek to engage in M&Aactivity to increase marketingpower: entered into businesscombination agreement with

Deutsche Borse AG Addition: build new clearing

houses in London and Paris forclearing European securitiesand derivatives in order toreduce the risk of dependenceon LCH; Two new data centersin Basildon, England, andMahwah, New Jersey

Migration: Move NYSE Arcaequities and options marketsand the NYSE Amex Optionsmarket to Universal TradingPlatform.11

NASDAQ OMX CommoditiesClearing Company

Nord Pool ASA, a derivativestrading market

SMARTS Group Holdings PtyLtd. a leading technologyprovider of surveillancesolutions to exchanges,regulators and brokers; todiversify the markettechnology business and enterinto surveillance andcompliance market

FTEN a leading provider ofReal-Time Risk Management

Appendix 3.1 Listings on the Toronto Stock Exchange and Toronto Venture Exchange


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Source: TMX Group 2009 Annual Reporthttp://www.tmx.com/en/pdf/TMXGroup2009AnnualReport.pdf

Appendix 3.2 TMX Strategic Priorities
http://www.tmx.com/en/pdf/TMXGroup2009AnnualReport.pdfhttp://www.tmx.com/en/pdf/TMXGroup2009AnnualReport.pdf


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Source: TMX 2010 MD&A Reporthttp://www.tmx.com/en/investor_relations/index.html

Appendix 4 TMX and Competitors - CAPEX Profiles
http://www.tmx.com/en/investor_relations/index.htmlhttp://www.tmx.com/en/investor_relations/index.htmlhttp://www.tmx.com/en/investor_relations/index.html


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TMX group Inc

CAD 2010 2009 2008 2007 2006 2005

Issuer services 162955 142,118 152,793 133,939 108,483 87,724

Trading, cleari ng & related revenue 242165 237,345 222,850 169,237 146,253 125,532

Market data 154415 145,976 135,533 110,241 86,941 67,430

Business services 15928 - - - 9,395 7,910

Business services & other revenue 30,877 22,013 11,307 0 0

Other revenue 0 0 0 1,775 1,368

Total revenue 575463 556,316 533,189 424,724 352,847 289,964

Income from operations 288938 283,183 305,371 243,124 204,551 150,772

Net income 196535 104,701 181,952 148,697 131,524 103,353

Amortization 32307 32,194 25,340 15,838 13,048 13,477Additions to premises & equipment -12813 -7,136 -5,306 -6,504 -4,228 -4,677

Additions to intangible assets -9684 -13,152 -8,451 -6,225 0 0

Proceeds on disposal of equipment 0 0 0 0 0 100

Marketable securities -159071 -7,071 203,546 33,268 -37,308 -93,621

Payment on termination of joint ventur 0 0 -15,152 0 0 0

Acquisitions, net of cash acquired 0 -37,932 -405,283 -8,142 -53,704 0

Purchase of option to acquire

NetThruPut Inc. 0 0 0 -10,265 0 0

Cash flows from (used in) investing

activities -181568 -65,291 -230,646 2,132 -95,240 -98,198

Amortization as % of revenues 5.61% 5.79% 4.75% 3.73% 3.70% 4.65%

Investing CF as % of revenues -31.55% -11.74% -43.26% 0.50% -26.99% -33.87%increase (decrease) in asset base as %

of revenues 25.94% 5.95% 38. 51% - 4.23% 23.29% 29.22%


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ASX ltd

AUD 2010 2009 2008 2007 2006

Listings 115,464 104,080 120,211 117,553 76,982

Cash market 181,442 163,042 188,800 163,991 0

Derivatives 155,473 138,090 171,681 152,135 0

Information services 68,752 71,025 68,003 61,135 0

Technology infrastructure 0 28,625 27,663 23,275 0

Market connectivity 29,852 0 0 0 0

Austraclear services 31,178 24,678 21,870 19,984 0

Equities trading, clearing & settlement 0 0 0 0 130,877

Derivatives trading, clearing & settleme 0 0 0 0 48,372

Information services 0 0 0 0 35,725

Dividends 8,075 7,027 4,852 3,150 2,700

Interest income 128,159 284,594 0 0 0Other revenue 16,504 14,220 21,305 10,930 13,675

Total revenue 734,899 835,381 624,385 552,153 308,331

ADDED IN; Operating income 564999 676746 466965 366584 164227

Net profit for the period attributable

to owners of the Company 328,137 313,610 365,949 292,892 135,503

Depreciation & amortization -23,674 -15,042 -18,916 - -

Acquisition of SFE, net of cash acquired - - - -57,738 -

Proceeds on sale of subsidiary - - - 14,722 -

Decre ase ( incre ase ) i n parti ci pan ts' mar - 618,438 - 44,709 - 2, 563,163 2, 800,472 -

Proceeds on sale of plant & equipment - - 7 23 92

Purchase of investments - -12,866 - - -

Purchase of plant & equipment - - - - -4,696

Payments for non-current assets -27,919 -22,887 -20,551 -15,350 -

Purchase of treasury shares - - -7,866 - -

Proceeds from sale of equity accounted - - - - 60,678

Incidental costs on sale of equity accou 0 0 0 0 -1,751

Deferred acquisition costs 0 0 0 0 -6,295

Repayments from associate 0 0 0 0 6,036

N et cas h fro m (ou tf lo w) i nve sti ng a ct ivi -646, 357 -80, 462 -2, 639, 768 2, 742, 129 44, 879

Amortization as % of revenues 3.22% 1.80% 3.03% 0.00% 0.00%

Investing CF as % of revenues -87.95% -9.63% -422.78% 496.62% 14.56%

increase (decrease) in asset base as %

of revenues 84.73% 7.83% 419.75% -496.62% -14.56%


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CBOE Holdings Inc

USD 2010 2009 2008 2007 2006

Net income 106451 115288 83168 42108

Depreciation & amortization 27512 25633 25338 28189

Other amortization 213 23 -422

Sales of investments available for sale 0 0 20000 -19511

Restricted funds - temporary access fees 26157 -21908 -4249 0

Capital & other assets expenditures -37997 -43816 -32095 -28700

Proceeds from disposition of property 0 105 0

Sale of NSX certificates of proprietary membership 1500 1500 0

Investment in affiliates 0 0 -13

HedgeStreet Inc. investment recovery 0 0 193

Net cash flows from investing activities -10340 -64119 -16164 -51779

Transaction fees 314506 343779 272716

Access fees 45084 5695 3527

Exchange services & other fees 22647 24479 22941

Market data fees 20506 21082 20379

Regulatory fees 15155 11000 14346

Other revenue 8184 10748 10361

Total operating revenues 426082 416783 344270 257986

Amortization as % of revenues 6.46% 6.15% 7.36% 10.93%

Investing CF as % of revenues -2.43% -15.38% -4.70% -20.07%


of revenues 8.88% 21.53% 12.06% 31.00%


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CME Group Inc

USD 2010 2009 2008 2007 2006

Clearing & transaction fees 2,486,300 2,161,900 2,115,366 1,427,320 866,089

Market data & information services 395,100 0 0 0 0

Quotation data fees 0 331,100 279,533 145,054 80,836

Processing services 0 500 54,073 106,404 90,148

Access & communication fees 45,400 45,600 43,618 35,804 0

Access fees 0 0 0 0 20,154

Communication fees 0 0 0 0 8,588

Other revenue 76,900 73,700 68,429 41,519 24,132

Total revenues 3,003,700 2,612,800 2,561,019 1,756,101 1,089,947

Operating income (loss) 1,831,100 1,589,100 1,582,195 1,050,493 620,855

Net income (loss) 952,100 825,800 715,486 658,533 407,348

Amortization of purchased intangibles 128,100 125,100 98,682 33,878 0

Depreciation & amortization 129,900 126,300 137,341 105,653 72,783

Proceeds from maturities of available-f 11,900 439,800 265,112 203,801 73,668

Purchases of available-for-sale marketa -10,200 -159,900 -367,554 -129,125 -29,681

Net change in New York Mercantile

Exchange, Inc. (NYMEX) securities

lending program investments 0 425,900 110,089 0 0

Purchases of property, net -160,000 -157,900 -200,102 -163,644 -87,810

Consideration paid in business combina-19,600 0 0 0 0

Net cash flows from invest ing activi ties -108,400 544,800 -3,749,068 -78,638 -85,860


Investing CF as % of revenues -3.61% 20.85% -146.39% -4.48% -7.88%


of revenues -4.98% -30.47% 137.17% -3.47% 1.20%


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Deutsche Boerse AG

EUR 2010 2009 2008 2007 2006

Sales revenue 2,061,700 2,455,100 2,185,200 1,854,200

Net interest income from banking

business 97,400 236,800 0 0

Net interest income from banking

business 0 0 230,800 150,700

Income from agency agreements 27,700 33,200 0 23,800

Income from exchange rate

differences 10,100 9,200 0 3,100

Total revenue 2,322,600 2,786,600 2,664,500 2,112,900

Earni ngs be fore i nte re st & taxe s (EBIT) 637,800 1,508,400 1,345,900 1,027,500

Net profit for the year 471,200 1,050,300 914,900 666,000

Depreciation, amortization &

impairment losses(other thangoodwill) -569,100 -137,100 -126,000 -130,400

Payments to acquire intangible assets

& property, plant & equipment -172,300 -94,500 -79,700 -69,200

Payments to acquire noncurrent

financial instruments -1,113,900 -344,000 -124,800 -84,300

Payments to acquire investments in

associates -1,400 -122,300 -300 -700

Payments to acquire subsidiaries, net

of cash acquired -51,000 0 -1,826,600 0

Effects of the disposal of (shares in)

subsidiaries, net of cash disposed -5,900 -24,600 358,900 34,300

Proceeds from the disposal of shares

in associates 7,500 16,800 0 0

Net decrease/(net increase) in current

receivables, securities & liabilities

from banking business with an original

term greater than three months 165,600 -391,200 -149,000 -270,100Proceeds from disposals of available

for sale noncurrent financial

instruments 88,700 19,900 50,900 118,500

Proceeds from disposal of other noncurrent assets 0 300 17,400 1,700

Cash f low f rom inve sting acti viti es - 1,082,700 - 939,600 -1,753,200 -269,800

Amortization as % of revenues 24.50% 4.92% 4.73% 6.17%

Investing CF as % of revenues -46.62% -33.72% -65.80% -12.77%

increase (decrease) i n asset base as %

of revenues 22.11% 28.80% 61.07% 6.60%


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IntercontinentalExchange Inc

USD 2010 2009 2008 2007 2006

Trans acti on & cl eari ng f ee s, ne t 1,023, 454 884,473 693,229 490,358 273,629

Market data fees 109,175 101,684 102,944 70,396 34,236

Other revenues 17,315 8,631 16,905 13,539 5,934

Total revenues 1,149,944 994,788 813,078 574,293 313,799

Operating income 652,249 512,619 493,534 353,563 204,635

Net income 407,767 314,154 300,972 240,612 143,268

Depreciation & amortization expense 121,209 111,357 62,247 32,701 13,714

Capital expenditures 21,774- 24,410- 30,484- 30,999- 12,377-

Capitalized software development

costs 25,994- 20,332- 18,328- 12,267- 7,438-

Cash paid for acquisitions, net of cash

acquired 552,981- 39,372- 44,606- 480,114- -

Purchase of foreign currency hedge

relating to CLE acquisition 15,080- - - - -

Purchase of intangible assets - - - 61,099- -

Proceeds from sale of assets - - - 13,269 -

Purchase s of cost me thod inve stme nts - - 2,385- 40- 36,937-

Proceeds from sales of cost method

investments - 23,451 - - -

Proceeds from sales of businesses &

assets - 1,580 - - -

Proceeds from sales of available-for-

sale investments 19,541 8,539 236,935 272,771 346,090

Purchases of available-for-sale

investments 18,226- 28,089- 102,567- 332,357- 309,227-

Capitalized acquisition costs - - 2,210- 121- 4,124-

Decrease ( increase) in restricted cash 18,568- 63,642- 106,101- 6,431- 3,615-

Net cash flows from investing activities 633,082- 142,275- 69,746- 637,388- 27,628-


Investing CF as % of revenues -55.05% -14.30% -8.58% -110.99% -8.80%increase (decrease) in asset base as %

of revenues 44.51% 3.11% 0.92% 105.29% 4.43%


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London Stock Exchange Group PLC

GBP 2010 2009 2008 2007 2006

Revenue 605,600 - -

Net interest income through CCP busine 16,200 - -

Other income 6,500 - -

Revenue 628,300 671,400 546,400 349,600 291,100

Operating profit/(loss) 182,300 -210,000 265,200 174200 85400

Profit/(loss) for the fi nancial year 91,700 -332,800 173,000 110600 66800

Impairment of goodwill - -484,000 - 0 0

Puchase of property, plant & equipmen -12,300 -19,900 -10,300 -6,000 -5,300

Purchase of intangible assets -29,900 -36,500 -21,900 -13,900 -20,500

Disposal of associate - 2,700 - -6200

Depreciation & amortization 123,000 85,800 48,400 24100 26500

Investment in joint ventures -6,100 -700 - -1900 -1700

Investment in subsidiary -16,300 -5,300 -

Net cash inflow from acquisitions 5,200 - -

Dividends received 2,500 3,800 2,400

Proceeds from sale of minority interest 7,400 - -

Acquisition of minority interest in

Borsa Italiana - - -500

Net cash (outflow)/inflow from

investing activities -49,500 -55,900 52,000 42400 3200


Investing CF as % of revenues -7.88% -8.33% 9.52% 12.13% 1.10%


of revenues -11.70% -4.45% -18.37% -19.02% -10.20%


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MF Global Holdings Ltd.

USD 2010 2009 2008 2007 2006

Execution only commissions - 381,118 486,192 386,533 261,758

Cleared commissions - 1,261,262 1,528,642 1,280,047 865,638

Commissions 1,386,044 - - - -

Principal transactions 225,442 287,652 281,912 299,546 158,540

Interest income 491,605 872,330 3,669,020 4,090,431 1,388,141

Other revenues 42,351 112,095 54,081 37,836 29,152

Total revenues 2,145,442 2,914,457 6,019,847 6,094,393 2,703,229

ADDED IN: EBIT -102,250 124,531 -140,119 88754 -14304

Net income (loss) -135,278 -48,610 -69,542 187,999 59,795

Depreciation & amortization 55,090 57,841 54,820 46,777 28,220

Acquisitions, net -3,364 -6,653 -58,468 -15,000 -302,369

Proceeds from sale of memberships in

exchanges 1,297 25,450 177,118 61,143 87,856

Purchase of memberships in

exchanges 0 -1,369 -1,101 -217 -1,153

Purchase of furniture, equipment &

leasehold improvements -32,539 -33,766 -28,623 -26,399 -19,391

Proceeds from sale of furniture,

equipment & leasehold improvements 0 66 274 108 75

Net cash flows from investing

activities -34,606 -16,272 89,200 19,635 -234,982


Investing CF as % of revenues -1.61% - 0.56% 1.48% 0.32% -8.69%


of revenues - 0.95% - 1.43% - 2.39% - 1.09% 7.65%


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NASDAQ OMX Group Inc

USD 2010 2009 2008 2007 2006

Market services re venue 2,700,000 2,929,000 3,207,294 2,152,390 1,408,297

Issuer services revenue 344,000 324,000 330,594 283,885 249,016

Market technology 152,000 145,000 106,151 - -

Other revenue 1,000 11,000 4,654 317 463

Total revenues 3,197,000 3,409,000 3,648,693 2,436,592 1,657,776

Operating income (loss) 389,000 263,000 319,880 518,401 127,893

Net income (loss) 103,000 104,000 92,578 38,890 70,916

De pre ciation & amortizati on ex pense 103,000 104,000 92,578 38,890 70,916

Purchases of trading securities -237,000 -607,000 -164,588 0 0

Purchases of available-for-sale investm0 0 0 -80,400 -1,827,057

Purchases of equity method

investment 0 -16,000 0 0 0Proceeds from sales & redemptions of

trading securities 350,000 542,000 - - -

Proceeds from maturities of available-

for-sale investments - - - 51,910 38,780

Proceeds from sales & redemptions of

available-for-sale investments - 25,000 - - -

Proceeds from sale of e quity method

investment 1,000 54,000 - - -

Proceeds from redemptions of

available-for-sale investments 0 0 15,176 1,864,630 581,670

Purchases of foreign currency contracts 0 0 -12,500 -12,988 -23,350

Settlement of foreign currency

contracts 0 0 66,515 67,937 0

Acquisitions of businesses, net of cash

& cash equivalents acquired &

purchase accounting adjustme nts -190,000 -6,000 -2,998,821 - 15,105 -53,959

Dispositions of businesses, net of cash& cash equivalents disposed 0 14,000 0 0 0

Purchase s of prope rty & e qui pme nt -42,000 -59,000 -54,719 - 18,489 -21,035

Proceeds from sales of property &

equipment 0 0 267 383 30,568

Net cash flows from investing activities -118,000 -53,000 -3,148,670 1,857,878 -1,274,383


Investing CF as % of revenues - 3.69% - 1.55% - 86.30% 76.25% - 76.87%


of revenues 0.47% - 1.50% 83.76% - 77.85% 72.60%


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34/81

Appendix 5 TMX and Competitors - Cash & Cash Equivalents

2010 2009 2008 2007 2006

Industry Average in terms of proportional weights

% of Current Assets 10.92% 18.18% 15.03% 19.88% 23.13%

% of Total Assets 3.99% 10.48% 8.25% 8.43% 16.85%

TMX group Inc

CAD 2010 2009 2008 2007 2006 2005

Cash & cash equivalents 68978 87,978 102,442 53,398 37,018 28,485

Total current a ssets 1550545 1,791,524 1,936,023 1,200,921 1,273,775 1,312,325

Total assets 3281919 3,524,475 3,672,086 1,523,919 1,572,838 1,557,225

% of current assets 4.45% 4.91% 5.29% 4.45% 2.91% 2.17%

% of total assets 2.10% 2.50% 2.79% 3.50% 2.35% 1.83%

ASX ltd

AUD 2010 2009 2008 2007 2006

unrestricted - - - - 204,823

unrestricted - - - - 71,489

Cash 1,242,620 1,433,424 414,412 118,677 -

Cash and cash equi val ents 1242620 1433424 414412 118677 276312

Total current assets 4,063,811 4,267,079 4,323,770 7,047,342 676,363

Total assets 6,620,796 6,786,847 6,791,885 9,518,463 813,246

% of current assets 30.58% 33.59% 9.58% 1.68% 40.85%

% of total assets 18.77% 21.12% 6.10% 1.25% 33.98%

CBOE Holdings INC

USD 2010 2009 2008 2007 2006

cash and cash equivalents 383,730 281,423

Total current assets 433,063 361,225

Total assets 571,948 496,139

% of current assets 88.61% 77.91%

% of total assets 67.09% 56.72%

CME Group Inc

USD 2010 2009 2008 2007 2006

Cash & cash equivalents 855,200 260,600 297,895 845,312 969,504

Total current assets 5,387,500 6,699,000 19,111,528 4,987,055 4,030,252

Total assets 35,046,100 35,651,000 48,158,654 20,306,197 4,306,505


% of total assets 2.44% 0.73% 0.62% 4.16% 22.51%


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Deutsche Boerse AG

EUR 2010 2009 2008 2007 2006 2005

Other cash & bank balances 559,700 482,800 547,600 652,400 543,100

Total current asse ts 156,109,500 141,333,700 75,473,800 63,117,500 31,087,000

Total assets 161,360,500 145,878,600 79,657,600 65,025,100 33,094,800


% of total assets 0.35% 0.33% 0.69% 1.00% 1.64%


USD 2010 2009 2008 2007 2006


Total current assets 23,575,778 19,459,851 12,552,588 1,142,094 340,917

Total assets 26,642,259 21,884,875 14,959,581 2,796,345 493,211


% of total assets 2.33% 2.52% 1.90% 4.28% 41.41%


GBP 2010 2009 2008

Cash & cash equivalents 223,100 143,700 200,600

Total current assets 84,617,600 35,937,700 17,642,700

Total assets 86,197,100 37,617,600 19,564,200

% of current assets 0.26% 0.40% 1.14%

% of total assets 0.26% 0.38% 1.03%


USD 2010 2009 2008 2007

Cash & cash equi val ents 826,227 639,183 1,481,084 1,692,554

ADDED IN: Total Current

Assets 40903113 28759377 42731457 46804376

Total assets 50,966,080 38,836,637 49,254,871 51,670,272

% of current assets 2.02% 2.22% 3.47% 3.62%

% of total assets 1.62% 1.65% 3.01% 3.28%


USD 2010 2009 2008 2007 2006

Cash & cash equivalents 315,000 594,000 565,760 1,325,314 321,995

Total c urrent asse ts 8,510,000 3,454,000 5,435,452 1,682,017 2,312,546Total assets 16,207,000 10,722,000 12,694,875 2,979,397 3,716,452


% of total assets 1.94% 5.54% 4.46% 44.48% 8.66%


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NYSE Euronext

USD 2010 2009 2008 2007 2006


Total current assets 1,174,000 1,520,000 2,026,000 2,278,000 1,443,068

Total assets 13,378,000 14,382,000 13,948,000 16,618,000 3,465,542


% of total assets 2.44% 2.94% 5.57% 5.80% 8.01%

Convert all profits into usd base currency using

average yearly exchange rate up until March 2011

2011 2010 2009 2008 2007 2006

AUD2USD avg exchange 1.003 0.919 0.792 0.852 0.838 0.753

EUR2USD avg exchange 1.359 1.327 1.394 1.471 1.37 1.256

GBP2USD avg exchange 1.598 1.546 1.565 1.854 2.001 1.842

CAD2USD avg exchange 1.013 0.971 0.88 0.944 0.935 0.882

Industry amount on absolute basis adjusted for

different currencies 2010 2009 2008 2007 2006

Cash & cash equivalents 4499077 5070783 5218579 5846367 2833531

Total current assets 215609422 339140502 328341146 167321182 89035134

Total assets 284771410 414333262 399624703 212902459 95652853


% of total assets 1.58% 1.22% 1.31% 2.75% 2.96%

Industry average is not indicative in 2010 due to missing data


37/81

Appendix 6 TMX and Competitors - Dividend Information

Industry Average

Excluding

Companies w/out

Dividends

Including

Companies w/out

dividends

12-Month Dividend Yield 3.85% 2.57%

5-Yr Dividend CAGR 13.29% 7.98%

TMX group Inc

CAD 2010 2009 2008 2007 2006 2005*

Feb 0.38 0.38 0.38 0.38 0.33 0.20

May 0.38 0.38 0.38 0.38 0.33 0.20

August 0.38 0.38 0.38 0.38 0.33 0.25

November 0.38 0.38 0.38 0.38 0.33 0.25

Total 1.52 1.52 1.52 1.52 1.32 0.90

12-Mth Dividend Yield 4.11% 3.50%

5-Yr Dividend CAGR 9.13%

*2 for 1 stock split in May

17, 2005

Special Cash in

November 2003 for

$2.50

ASX ltd

AUD 2010 2009 2008 2007 2006 2005

February 1.27 1.29 1.41 1.03 0.80 0.63August 1.20 1.06 1.34 1.31 0.91 0.73

Total 2.47 2.36 2.75 2.34 1.72 1.36

12-Mth Dividend Yield 7.14%


*Return of Capital .585

on October 17, 2006 and

also on August 27, 2004

paid .34429 of Special

Cash

Return on Capital

on September 10,

2003 paid .392857

of Special Cash


38/81

CBOE Holding Inc.

USD 2010 2009 2008 2007 2006 2005

March -

June -

September 0.10

December 0.10

Total 0.20 - - - - -



Stock Repurchase:

5.984M and 12.351M

Class A shares in October

2010

CME Group Inc

USD 2010 2009 2008 2007 2006 2005

March 1.15 1.15 1.15 0.86 0.63 0.46

June 1.15 1.15 1.15 0.86 0.63 0.46

September 1.15 1.15 1.15 0.86 0.63 0.46

December 1.15 1.15 1.15 0.86 0.63 0.46

Special Dividend 5.00

Total 4.60 4.60 9.60 3.44 2.52 1.84



Deutsche Boerse AG

EUR 2010 2009 2008 2007 2006 2005

May 2.10 2.10 2.10 1.70 1.05 0.35

Total 2.10 2.10 2.10 1.70 1.05 0.35




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USD 2010 2009 2008 2007 2006 2005

No Dividend but there

are a couple of mergers

12-Mnth Dividend Yield 0.00%



GBP 2010 2009 2008 2007 2006 2005

July 17.778 17.778 17.778 13.333 10.543 5.930

December 9.778 9.333 9.333 8.889 6.667 5.271

Total 27.556 27.111 27.111 22.222 17.209 11.202



Return of Capital

GBp 237.20929 on

May 12, 2006

*43 for 51

Consolidation

on May 12, 2006


USD 2010 2009 2008 2007 2006 2005only pays dividends to

preferred shares




USD 2010 2009 2008 2007 2006 2005

No dividend but acquiring

and merging often




40/81

NYSE Euronext

USD 2010 2009 2008 2007 2006 2005

March 0.30 0.30 0.25 - - -

June 0.30 0.30 0.30 0.25 - -

September 0.30 0.30 0.30 0.25 - -

December 0.30 0.30 0.30 0.25 - -

Total 1.20 1.20 1.15 0.75 - -




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Appendix 7TMX and Competitors - Share Repurchase Information

TMX group Inc

CAD 2010 2009 2008 2007 2006

Balance, beginning of the period - 74,403,577 66,278,370 68,421,264 -

Repurchase - 1,000,000 7,523,249 2,399,862 -

- 1.34% 11.35% 3.51%


5-Yr Dividend Growth 8.66%

ASX ltd

AUD 2010 2009 2008 2007 2006

No share buy-back - - - - -



CBOE Holding Inc.

USD 2010 2009 2008 2007 2006

Balance, beginning of the period 1,026,000,000 - - - -

Repurchase 18,335,000

1.79%

CBOE's stock repurchase is part of an agreement with its original

members in order to seek approval for its IPO in 2010 an d may

not be done in similar interests compared to other firms



CME Group Inc

USD 2010 2009 2008 2007 2006

Balance, beginning of the period 67,049,401.00 66,382,637 58,743,842 43,754,153 34,693,356

Repurchase 2,000,000.00 783,000.00 117,000 1,700,000 -

2.98% 1.18% 0.20% 3.89% -

12-Mth 12-Mth Dividend Yield 1.64%



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Deutsche Boerse AG

EUR 2010 2009 2008 2007 2006

Balance, beginning of the period - 185,922,690 185,790,599 191,888,548 195,597,922

Repurchase - 9,077,310 6,200,000 4,100,000 3,600,000

- 4.88% 3.34% 2.14% 1.84%




USD 2010 2009 2008 2007 2006

Balance, beginning of the period - 71,184,000 - - -

Repurchase - 322,000 - - -

- 0.45% - - -

12-Mnth Dividend Yield 0.00

5-Yr Dividend Growth 0.00


GBP 2010 2009 2008 2007 2006

Balance, beginning of the period - 270, 500, 000 207,100,000.00 254,300,000 -

Repurchase - 5,900,000 10,100,000.00 9,000,000 -

- 2.18% 4.88% 3.54% -




USD 2010 2009 2008 2007 2006

The company is not allowed to pay dividend or repurchase

common stocks due to covenants

with Series A Preferred Stockholders




43/81


USD 2010 2009 2008 2007 2006

Balance, beginning of the period 211,385,646 201,896,700 - 112,317,987 80,543,397

Repurchase 37,831,647 - - - -

17.90%

*If excluding the 22.781mil shares repurchase

agreement with Boerse Dubai, the percentage of

share repurchase is only 7.12%



NYSE Euronext

USD 2010 2009 2008 2007 2006

Balance, beginning of the period - - 265,000,000 - 1,720,610

Repurchase - - 13,400,000 - -

Repurchased under liquidity contract* - - - - 20,616

- - 5.06% - 1.20%

*The company repurchased shares un der liquidity

contract to stabilise stock price



Appendix 8 TMX and Competitors - Earnings Information

TMX group Inc

CAD 2010 2009 2008 2007 2006 2005*

Total revenue 575500 556,316 533,189 424,724 352,847 289,964

Revenue growth 3.45% 4.34% 25.54% 20.37% 21.69%

EBITDA 321282 315377 330711 258962 217599 164249

EBITDA growth 1.87% -4.64% 27.71% 19.01% 32.48%


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ASX ltd

AUD 2010 2009 2008 2007 2006

Total revenue 734,899 835,381 624,385 552,153 308,331

Revenue growth -12.03% 33.79% 13.08% 79.08%

EBITDA 588673 691788 485881 366584 164227

EBITDA growth -14.91% 42.38% 32.54% 123.22%

CBOE Holding Inc.

USD 2010 2009 2008 2007 2006

Total operating revenues 426082 416783 344270 257986

Revenue growth 2.23% 21.06% 33.45%

EBITDA 205097 212943 161804 100216

EBITDA growth -3.68% 31.61% 61.46%

CME Group Inc

USD 2010 2009 2008 2007 2006

Total revenues 3,003,700 2,612,800 2,561,019 1,756,101 1,089,947

Revenue growth 14.96% 2.02% 45.84% 61.12%

EBITDA 1961000 1715400 1719536 1156146 693638

EBITDA growth 14.32% -0.24% 48.73% 66.68%

Deutsche Boerse AG

EUR 2010 2009 2008 2007 2006 2005

Total revenue 2,322,600 2,786,600 2,664,500 2,112,900 1,851,100

Revenue growth -16.65% 4.58% 26.11% 14.14%

EBITDA 1206900 1645500 1471900 1157900 866400

EBITDA growth -26.65% 11.79% 27.12% 33.64%


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USD 2010 2009 2008 2007 2006

Total revenues 1,149,944 994,788 813,078 574,293 313,799

Revenue growth 15.60% 22.35% 41.58% 83.01%

EBITDA 773458 623976 555781 386264 218349

EBITDA growth 23.96% 12.27% 43.89% 76.90%


GBP 2010 2009 2008 2007 2006

Revenue 628,300 671,400 546,400 349,600 291,100

Revenue growth -6.42% 22.88% 56.29% 20.10%

EBITDA 303700 359800 313600 209700 146600EBITDA growth -15.59% 14.73% 49.55% 43.04%


USD 2010 2009 2008 2007 2006

Total revenues 2,145,442 2,914,457 6,019,847 6,094,393 2,703,229

Revenue growth -26.39% -51.59% -1.22% 125.45%

EBITDA -47160 182372 -85299 135531 13916

EBITDA growth -125.86% -313.80% -162.94% 873.92%


USD 2010 2009 2008 2007 2006Total revenues 3,197,000 3,409,000 3,648,693 2,436,592 1,657,776

Revenue growth -6.22% -6.57% 49.75% 46.98%

EBITDA 734000 707000 732763 404552 285005

EBITDA growth 3.82% -3.52% 81.13% 41.95%


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NYSE Euronext

USD 2010 2009 2008 2007 2006

Total revenues 4,425,000 4,687,000 4,703,000 4,158,000 2,375,950

Revenue growth -5.59% -0.34% 13.11% 75.00%

EBITDA 1026000 552000 -335000 1161000 369261

EBITDA growth 85.87% -264.78% -128.85% 214.41%

Ignore 2005

due to

missing data

points

2010 2009 2008 2007 2006 2005*

Absolute

industry revenue

and EBITDA

adjusted for

different

currencies

USD revenue 6359178 9473295 9938301 7884400 5395125 2544129.764

growth -32.87% -4.68% 26.05% 46. 14% 112.06%

2010 2009 2008 2007 2006 2005*

EBITDA 5769774 7056778 6528831 6390737 3720330 1214337.674

-18.24% 8.09% 2.16% 71.78% 206.37%


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Appendix 9 TMX and Competitors - EBITA Calculations

TMX group Inc

CAD 2011 2010 2009 2008 2007 2006 2005*

Total revenue 556,316 533,189 424,724 352,847 289,964

Compensation &

benefits 129,369 110,486 96,251 79,006 72,510

Information & trading

systems 46,120 36,354 26,505 22,014 17,443

General &

administration 65,450 55,638 43,006 34,228 35,762

EBITDA 315,377 330,711 258,962 217,599 164,249

ASX ltd

AUD 2011 2010 2009 2008 2007 2006

Total revenue 734,899 835,381 624,385 552,153 308,331

Staff expenses 81424 81743 79160 84389 69301

Occupancy expenses 13334 12759 7458 37619 31958

Equipment expenses 23987 24191 25086 41859 21411Administration

expenses 27481 24900 26800 21702 21434

EBITDA 588,673 691,788 485,881 366,584 164,227

CBOE Holding Inc.

USD 2011 2010 2009 2008 2007 2006

Total operating

revenues 426082 416783 344270 257986

Total operating

expenses 248,497 229,473 207,804 185959

Depreciation &

amortization 27,512 25,633 25,338 28,189

EBITDA 205,097 212,943 161,804 100,216


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CME Group In c

USD 2011 2010 2009 2008 2007 2006

Total revenues 3,003,700 2,612,800 2,561,019 1,756,101 1,089,947

Total expenses 1,172,600 1,023,700 978,824 705,608 469,092

Depreciation &

amortization 129,900 126,300 137,341 105,653 72,783

EBITDA 1,961,000 1,715,400 1,719,536 1,156,146 693,638

Deutsche Boerse AG

EUR 2011 2010 2009 2008 2007 2006

Total revenue 2,322,600 2,786,600 2,664,500 2,112,900

Earnings before

interest & taxes (EBIT) 637,800 1,508,400 1,345,900 1,027,500

Depreciation,

amortization &

impairment

losses(other than

goodwill) 569,100 137,100 126,000 130,400

EBITDA 1,206,900 1,645,500 1,471,900 1,157,900

Intercontinental

Exchange Inc

USD 2011 2010 2009 2008 2007 2006

Total revenues 1,149,944 994,788 813,078 574,293 313,799

Total operating

expenses 497,695 482,169 319,544 220,730 109,164

Depreciation &

amortization expense 121,209 111,357 62,247 32,701 13,714

EBITDA 773,458 623,976 555,781 386,264 218,349

London Stock

Exchange Group PLC


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GBP 2011 2010 2009 2008 2007 2006

Revenue 628,300 671,400 546,400 349,600 291,100

Operating expenses 447,600 397,400 281,200 164000 171000

Depreciation &

amortization 123,000 85,800 48,400 24100 26500

EBITDA 303,700 359,800 313,600 209,700 146,600

NASDAQ OMX Group

Inc

USD 2011 2010 2009 2008 2007 2006Total revenues 3,197,000 3,409,000 3,648,693 2,436,592 1,657,776

Tota l cost of revenues 1,675,000 1,956,000 2,188,615 1,624,353 970,381

Total operating

expenses 891,000 850,000 819,893 446,577 473,306

Depreciation &

amortization expense 103,000 104,000 92,578 38,890 70,916

EBITDA 734,000 707,000 732,763 404,552 285,005

USD 2011 2010 2009 2008 2007 2006

Total revenues 4,425,000 4,687,000 4,703,000 4,158,000 2,375,950

Operating income

(loss) from continuingoperations 745,000 286,000 -588,000 909,000 233,464

Depreciation &

amortization 281,000 266,000 253,000 252,000 135,797

EBITDA 1,026,000 552,000 -335,000 1,161,000 369,261

Appendix 10 TMX and Competitors - Financial Ratios


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Industry Average

2010 2009 2008 2007 2006 2005

Quick Ratio 0.38 0.55 0.77 0.92 1.75 1.00

Current Ratio 1.02 1.05 1.31 1.45 3.01 1.13

Receivables

Turnover 5.92 5.79 5.73 6.69 7.63 0.35

Accounts

Payable

Turnover 122.78 44.38 50.79 37.45 51.71 8.79

Interest

Coverage 21.94 34.47 1253.45 53.38 52.83 79.86

2010 calculation s

current ratio

current assets 1550545

current liabilities 1696400

current ratio 0.914021

cash 68797

marketable

securities 261605

A/R 89680

current

liabilities 1696400

quick ratio 0.247631

2010

calculations

2010 2009

revenue 575463 A/P 59093 44993

operating expenses 286525

Energy

receivable 754933 714545

amortization 32307 A/R 89680 79427

sum of A/R 844613 793972

A/R turnover 0.70239

A/P turnover 5.505543

interest expense 6205

interest coverage 92.74182

average of balances for turnovers


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TMX group Inc

2010 2009 2008 2007 2006 2005

Quick Ratio 0.25 0.54 0.64 0.89 0.95 0.99

Current Ratio 0.91 1.1 1.08 1.27 1.27 1.23

Receivables Turnover 0.7 0.61 0.58 0.49 0.36 0.35

Accounts Payable Turnover 5.51 10.66 9.88 9.72 9.63 8.79

Interest Coverage 92.7 46.65 29.06 31.76 26.72 19.7

ASX ltd

2010 2009 2008 2007 2006

Quick Ratio 0.48 0.44 0.18 0.08 1.52

Current Ratio 1.22 1.12 1.1 1.06 1.54

Receivables Turnover 2.53 3.05 1.72 2.51 12.63

Accounts Payable Turnover 184.32 184.45 128.65 109.13 47.68

Interest Coverage 5.72 2.92

CBOE Holding Inc.

2010 2009 2008 2007

Quick Ratio 1.19 3.51

Current Ratio 1.21 3.97

Receivables Turnover 10.8

Accounts Payable Turnover 8.69

Interest Coverage 202.95 9,858.42 17.83


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CME Group Inc

2010 2009 2008 2007 2006

Quick Ratio 1.09 1 0.98 0.46 0.59

Current Ratio 1.13 1.03 1.03 1.22 1.46



Interest Coverage 13.05 12.11 22.64 - 66.42

Deutsche Boerse AG

2010 2009 2008 2007 2006 2005

Quick Ratio 0.97 0.93 0.93 0.99 1

Current Ratio 1 1 0.99 1.02 1.03

Receivables Turnover 0.02 0.03 0.04 0.05

Accounts Payable Turnover 21.14 25.83 28.27 25.28

Interest Coverage 11.05 34.58 250.21 187.41 140.01


2010 2009 2008 2007 2006

Quick Ratio 0.03 0.03 0.03 0.19 6.23

Current Ratio 1.02 1.03 1.02 1.25 9



Interest Coverage 23.76 24.46 61.41 52.18


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2010 2009 2008

Quick Ratio 0 0.01 0.02

Current Ratio 1 1 0.98

Receivables Turnover 5.09 5.7

Accounts Payable Turnover 35.7 30.94

Interest Coverage 4.84 - 9.05

MF Global Holdings Ltd.2010 2009 2008 2007 2006

Quick Ratio 0.54 0.46 0.62 0.55

Current Ratio 1.03 1.06 1.02 1.02

Receivables Turnover 0.65 0.47 0.73

Accounts Payable Turnover 640.24 97.4 152.05

Interest Coverage - 0.93 0.17 4.22 2.73


2010 2009 2008 2007 2006

Quick Ratio 0.07 0.31 0.18 3.83 1.21

Current Ratio 1.03 1.2 1.07 4.09 5.02



Interest Coverage 6.78 6.78 12.29 10.38 3.22


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NYSE Euronext

2010 2009 2008 2007 2006

Quick Ratio 0.59 0.5 0.59 0.44 0.76

Current Ratio 0.81 0.71 0.78 0.66 1.73



Interest Coverage 6.71 2.34 - 7.05 30.5


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Appendix 12 Institutional Ownership Data

ASX INSTITUTIONAL OWNERSHIP DATA BLOOMBERG


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LSE INSTITUTIONAL OWNERSHIP DATA BLOOMBERG


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TMX INSTITUTIONAL OWNERSHIP DATA BLOOMBERG


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ASX DIVIDEND DATA BLOOMBERG


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ASX DIVIDEND DATA BLOOMBERG


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CBOE DIVIDEND DATA BLOOMBERG


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CBOE DIVIDEND DATA BLOOMBERG


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CME DIVIDEND DATA BLOOMBERG


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DB1 DIVIDEND DATA BLOOMBERG


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DB1 DIVIDEND DATA BLOOMBERG


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ICE DIVIDEND DATA BLOOMBERG

NO DIVIDEND PAID


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NASDAQ INSTITUTIONAL OWNERSHIP DATA BLOOMBERG

NO DIVIDEND PAID


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NYSE EURONEXT DIVIDEND DATA BLOOMBERG


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NYSE EURONEXT DIVIDEND DATA BLOOMBERG BLOOMBERG


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TMX DIVIDEND DATA BLOOMBERG


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TXM DIVIDEND DATA BLOOMBERG


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Appendix 13 CAGR Calculation

Appendix 14 Main Competitors in the Securities Exchange Industry


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Australian StockExchange

Market Cap:N/AASX and its subsidiaries are engaged in providing stock exchange and ancillaryservices in Australia. Co. provides rules of conduct for admission to and continuedparticipation in trading activity on its markets; surveillance and reporting of marketactivity; investigation and enforcement of market participation and listed companybehavior; assistance to the Australian Securities & Investments Commission; supportand guidance to market participants and listed companies; review and appealmechanisms for market participants and listed companies; automated trading andclearing platforms; guarantees of trade completion and risk management; and,information

Chicago Board ofOptions

Market Cap: 2.6BCBOE Holdings is a registered securities exchange. Co.'s business is providing a marketplacefor the trading of options on individual equities, exchange-traded funds and various indexes. Inaddition to its core options trading business, Co. provides marketplaces for trading futurescontracts and cash equities through its subsidiary CBOE Futures Exchange and its affiliate

CBOE Stock Exchange.Chicago MercantileExchange

Market Cap:20.0BCME Group is a holding company for Chicago Mercantile Exchange Inc., Board of Trade of theCity of Chicago, Inc., New York Mercantile Exchange, Inc. and their respective subsidiaries.Co. provides a range of products including those based on interest rates, equities, foreignexchange, commodities, energy and metals. Co. also provides clearing services for clearedover-the-counter derivatives including credit default swaps and interest rate swaps. Trades areexecuted through Co.'s electronic trading platform, open outcry and privately negotiatedtransactions. Through its clearing house, Co. also provides clearing, settlement andguarantees for products cleared through the exchange.

Deutsche Boerse AG Market Cap; 13.8BDeutsche Boerse is a global financial marketplace operator. Co.'s business areas are dividedinto Cash Market, comprising two market structure for securities trading: floor trading ofFrankfurter Wertpapierbrse and Xetra, an electronic trading system; Derivatives Market,where it jointly operates with SIX Swiss Exchange the Eurex derivatives exchange; MarketData & Analytics, which develops, disseminates and markets information on the internationalfinancial markets; Banking, Settlement and Custody, which is engaged in providing back officeservices for shares and bonds, and Information Technology, which designs, develops andoperates the technological infrastructure of Co.

IntercontinentalExchange Inc. Market Cap:9.3BIntercontinentalExchange is an operator of global futures exchanges, over-the-counter (OTC)markets and derivatives clearing houses. Co. operates futures and OTC marketplaces fortrading and clearing energy, environmental and agricultural commodities, credit default swaps,equity indexes and foreign exchange contracts. Co. provides trading in standardized derivativecontracts on its regulated exchanges in its futures markets; electronic trading, clearing andbrokerage services in its OTC markets, which include energy markets and credit derivatives;and a variety of market data services and products for both futures and OTC marketparticipants and observers through its market data segment.

London StockExchange

Market Cap: Gbp226.6BLondon Stock Exchange is a diversified exchange group based in the United Kingdom. Co. isengaged in the admission of securities for trading, delivery of trading systems, clearing andsettlement of trading in securities and the provision of associated information services. Co.'soperations are organized in six segments: Issuer, Trading, Information, Post Trade, Corporateand Other. Co.'s systems provide trading, allowing investors and institutions access to equity,bond and derivatives markets. Co. acts as a central counterparty, guaranteeing parties to atrade that will be paid and securities delivered, as well as a Central Securities Depository andsecurities settlement systems.


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MF Global HoldingsInc.

Market Cap: 1.3BMF Global Holdings is a brokerage firm providing services in the global cash and derivativesmarkets. Co. provides execution and clearing services for products in the exchange-tradedand over-the-counter (OTC) derivative markets, as well as for products in the cash market. Co.provides its clients with global market access to more than 70 securities and futuresexchanges and also facilitates trades in the OTC markets. Co. principally provides its clientswith execution and clearing services for five general types of products: equities, fixed income,interest rate products (which include listed futures and options), foreign exchange andcommodities.

NASDAQ OMX Market Cap: 4.5BNASDAQ OMX Group is a holding company. Through its subsidiaries, Co. provides tradingand clearing across multiple asset classes, market data products, financial indexes, capitalformation services, financial services and market application products and services. Co.operates in three segments: Market Services, which includes Co.'s U.S. and EuropeanTransaction Services businesses, as well as its Market Data and Broker Services businesses;Issuer Services, which includes Co.'s Global Listing Services and Global Index Groupbusinesses; and Market Technology, through which Co. is an applications provider and partnerto exchanges, clearing organizations and central securities depositories.

NYSE Euronext Market Cap: 9.0BNYSE Euronext is a holding company. Through its subsidiaries, Co. provides a range ofproducts and services in cash equities, futures, options, swaps, exchange-traded products,bonds, carbon trading, clearing operations, market data and commercial technology services,to issuers, investors, financial institutions and market participants. Co. operates the followingsecurities exchanges: New York Stock Exchange (NYSE), NYSE Arca, Inc. and NYSE AmexLLC in the U.S. and the five European-based exchanges that comprise Euronext N.V., namelythe Paris, Amsterdam, Brussels and Lisbon stock exchanges, as well as the NYSE Liffederivatives markets in London, Paris, Amsterdam, Brussels and Lisbon.

Toronto StockExchange

Market Cap: 2.9BTTMX Group owns and operates two national stock exchanges, Toronto Stock Exchange,serving the senior equity market and TSX Venture Exchange, serving the public venture equitymarket, Montreal Exchange Inc., Canada's national derivatives exchange, Natural GasExchange Inc. an exchange providing a platform for the trading and clearing of natural gas,electricity, and crude oil contracts in North America, Shorcan Brokers Limited, a fixed incomeinter-dealer broker, and The Equicom Group Inc., providing investor relations and relatedcorporate communications services

Source: Business Summary taken from MergentOnline Database. Market Cap taken from CNBC.com on March 20, 2011


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1 Datamonitor Report. Company Profile, TMX Group Inc.. p4

2 Datamonitor Report. Company Profile, NYSE Euronext Group Inc.. p4,5

3 Datamonitor Report. Company Profile, NASDAQ OMX Group Inc.. p4,5

4 NYSE Euronext Listings Directory http://www.nyse.com/about/listed/1170350259411.html

5 Datamonitor Report. Company Profile, NASDAQ OMX Group Inc.. p6

6 TMX Group Annual Report. P15. http://www.tmx.com/en/pdf/TMXGroup2009AnnualReport.pdf

7 TMX 2010 Managements Discussion and Analysis. P8 http://www.tmx.com/en/investor_relations/index.html

8 NYSE Group 2009 Annual Report. P31 http://ir.nyse.com/phoenix.zhtml?c=129145&p=irol-reportsAnnual



11 NYSE Group 2009 Annual Report. P33 http://ir.nyse.com/phoenix.zhtml?c=129145&p=irol-reportsAnnual


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Documents

TMX Dividend Policy