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CBOE Holdings sees volume fall, but profits jump 25%

Updated: February 8, 2013 5:01PM

The owner of the Chicago Board Options Exchange reported a 25 percent increase in fourth quarter profit Friday despite a drop in trading volume.

CBOE Holdings Inc. said its fourth quarter net income was $39.7 million, 45 cents a share, vs. $31.8 million, 35 cents a share, for the same period in 2011. Revenue rose 8 percent to $130.1 million.

Some improvement came from more revenue in the CBOE’s proprietary products, such as contracts on its popular VIX volatility index. Overall trading at the CBOE, the nation’s largest options market, declined 6 percent last year.

“Our ability to leverage our higher-margin, proprietary products and to effectively manage our resources enabled CBOE to return increased value to stockholders while continuing to invest in product development, trading technology and investor education,” said William Brodsky, chairman and chief executive officer. “As a result, we enter 2013 well-positioned to continue to enhance stockholder value and to grow and shape the options and volatility space.”

In its earnings report, CBOE disclosed that it is in settlement talks with the Securities and Exchange Commission over an investigation of its market oversight. It said it set aside $5 million for such a settlement.

“While the company is engaged in settlement discussions with the SEC staff on the resolution of this matter, no agreement has been reached and any final resolution could differ from the amount accrued,” the company said in its earnings release.

CBOE shares rose 16 cents Friday to close at $34.46.

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