Euronext N.V. (ENX) Earnings Call Transcript & Summary

Good morning, everyone. Dear shareholders, I hereby open the Annual General Meeting of Euronext N.V. My name is Piero Novelli, I am the Chairman of Euronext Supervisory Board. I welcome you all on behalf of the Supervisory Board and the Management Board of Euronext N.V. [Audio Gap] listed the company. Please turn off or mute your mobile phones during the meeting. Euronext N.V. is an international company, and its corporate language is English. Therefore, the general meeting will be conducted in English, as announced in the convocation to the meeting. From now on, I will refer to Euronext N.V. as either Euronext or the company interchangeably. I would like to inform you that most of the members of the Supervisory Board, the CEO, Mr. Stéphane Boujnah; the CFO, Mr. Giorgio Modica; and the Corporate Secretary, Ms. Sylvia Andriessen, are present behind this table. The other members of the Managing Board are in front of us in the meeting room. Also present in this room are the nominees for appointment to the Managing Board. Mr. Manuel Bento and Mr. Benoît van den Hove. Further, a number of senior staff members of the company are present, among them, Ms. Aurelie Cohen, who is our Head of Investor Relations. In addition, please note the presence of Ms. Corrine Holdinga, our notary, and of Mr. Jasper Kolsters, the lead partner at EY, our external accountant for the 2022 accounts. In accordance with the Articles of Association, the general meeting is held in Amsterdam, this being the municipality where the company has its registered seat. All shareholders have been called to attend this Annual General Meeting by the Managing Board and the Supervisory Board by means of a convening notice published on the 31 March 2023 on Euronext's website, including the agenda and explanatory notes thereto. This announcement explained the procedure for shareholders who wish to either attend the meeting in-person or provide voting instructions or grant a power of attorney. No requests have been received from shareholders regarding the addition of proposals to the agenda of this general meeting. In accordance with corporate governance recommendations, the draft minutes of this meeting will be made available to shareholders within 3 months of the meeting by publication on the website, giving shareholders the opportunity to comment on these minutes during the subsequent 3 months. Having taken into account all that has been expressed before, I conclude that this Annual General Meeting has been convened in accordance with all the applicable rules and the articles of association of Euronext N.V. and that the General Meeting may decide on all items that are placed on the agenda. Before we proceed, I will now inform you about how many shares are represented at this meeting in-person or by proxy and how many votes can jointly be cast. Please note that the number of issued shares that I will announce in a few moments corresponds to the number of issued shares as at the registration date, which was April 19. I will now announce the relevant numbers for today's meeting, attendance AGM 2023: issued share capital as per the registration date, 107,106,294 shares. Shares with voting rights, 106,722,913 shares. Represented shares, 85,226,977 shares. Percentage of the issued capital present or represented, 79.85%. Absolute, 50% plus 1, majority of the votes, 42,613,490 shares. Qualified 75% plus 1, majority of the votes [ 63,920,234 ] shares. Agenda Item 2, presentation of the Chief Executive Officer. I first invite the CEO and Chairman of the Managing Board, Mr. Stéphane Boujnah to present the report of the Managing Board on the financial year 2022 and the Q1 2023 figures.

I was just saying thank you, and welcome to Amsterdam in this wonderful city. I will start with some highlights of the past 4 years, and I will then provide you with an update on our ESG commitments, which are very important for the company before concluding with an update on our full year 2022 and our first quarter '23 performance. Starting on Slide 4 with a snapshot of the progress made over the last 4 years. With the acquisition of Borsa Italiana, we have transformed Euronext into the leading pan-European market infrastructure. Concretely, it means that we are now operating 7 exchanges in Europe, uniting around EUR 6.8 trillion in aggregated market capitalization. So Euronext is by far the largest network of exchanges that exist in Europe today. And this has strategically positioned us as delisting venue of choice in Europe and beyond. In addition, we have grown our post trade business with the addition of 2 CSDs and a proprietary clearing house. And this gives us the capability to manage the entire capital market value chain for the first time since the IPO in 2014. So thanks to this diversification strategy, Euronext has more than doubled its underlying revenue and income. And meanwhile, we have maintained our best-in-class cost discipline, leading to an adjusted EBITDA margin above 58%. So moving on Page 5. These numbers reflect; one, I think of the most important achievement of the past few years, which is the performance of the Euronext business, which is more than diversified than ever. Concretely, the increased diversification appears in several dimensions. First, Euronext has significantly grown its share of nonvolume-related activities, making the revenue of our company more robust throughout different market conditions. And secondly, Euronext has diversified its trading activity with expansion into power trading and fixed income trading. As you can see, since 2019, we have strengthened our CSD activities, adding Euronext Securities in Copenhagen, Euronext Securities in Milan through our existing network of European CSDs, Euronext Securities in Oslo and Euronext Securities in Porto. Finally, since the acquisition of the Borsa Italiana Group in 2021, we are also the owner of a proprietary clearing house Euronext, which as I will comment later on is transforming the outlook of the company. On Slide 6, as you can see it, since 2019, we have also expanded significantly and strengthened our presence in the Nordic region and significantly expanded our footprint in Italy. The Nordic region before the acquisition of Borsa Italiana was representing 25% of the top line of the group, and is definitely an area and a part of Europe where Euronext will continue growing. But together, the new geographies, the Nordic regions, the incremental businesses in the Nordic regions and Italy accounted for close to 40% of the additional revenue in '22 compared to the revenue in 2019. So the company is becoming generally pan-European with these developments in the Nordic regions and in Italy. Throughout our journey, and that's we are now on Slide 7, we delivered on our ambition to build the leading pan-European market infrastructure. Euronext is today the first equity listing venue in Europe as demonstrated in particular the performance of Amsterdam for International Listing. The first cash equity trading venue in Europe, the first bond listing venue, in particular, in Dublin, not only in Europe but worldwide when it comes to bond listing. We now also operate strong assets in fixed income with MTS in Rome. And we operate strong post trade assets with fully owned multi-asset classes, clearing house, Euronext clearing and the third largest CSD network in Europe. As you can see, Euronext is today the leading diversifying pan-European market infrastructure. Moving to Slide 8. Cash generation and capital allocations are absolutely key to the system about success of Euronext. Euronext is in the business of creating capital, not destroying capital. Over the past few years, we have maintained our rigorous capital allocation policy. We have strategically invested around EUR 4.7 billion since 2019, but our strong cash flow generation and our continued deleveraging discipline has allowed us to decrease the leverage from 3.2x net debt to adjusted EBITDA at the moment of the Borsa Italiana acquisition in April '21 to 2.1x at the time -- at the end of March 2023. So our continued, consistent robust deleveraging progress was recognized as S&P upgraded Euronext to BBB+ in February this year. Slide 9 illustrates Euronext expansion into the Nordic region, which was a major component of our development over the past few years. We started with the acquisition of Oslo Børs VPS in 2019, which has become now a strategically important hub for the listing of energy companies. Furthermore, this transaction enabled us to integrate Euronext Securities Oslo, the Norwegian CSD into post trade franchise, together with Euronext Securities Copenhagen that joined the group in 2020 and Euronext Securities Milan. This allowed us to create the third largest network of CSD in Europe after European and [indiscernible] We have furthermore diversified into a new asset class with the acquisition of the power trading market, which has continuously expanded beyond the Nordics since joining Euronext in particular, over the past 12 months. I want to focus now on page -- on Slide 10. Because since our IPO, we have demonstrated a unique track record of integrated strategic assets, achieving EUR 182 million of synergies. We have successfully completed the first milestones of our growth for Impact 2024 strategic plan on time and on budget. This allowed us to upgrade in February this year, our synergies target for the Borsa Italiana acquisition, which were EUR 60 million originally announced in October '20 to EUR 100 million in November '21, and to EUR 115 million run rate cumulative synergies in relation to the acquisition of Borsa Italiana by the end of '24, as announced in February '23. So we will, therefore, deliver almost a double of the amount of synergies initially targeted in relation to the acquisition of the Borsa Italiana Group. Let me continue on Slide 11 with the demonstration or illustration of how we will become the only fully integrated trading value chain across Europe. As you can see it on this page, the past few years -- the past few years, sorry, mark several material milestones that will shape the future of Euronext in the years to come. We were able to reinforce our position as the leading venue for equity listing in Europe and for that listing worldwide. Later on, the successful migration of the Italian cash markets into uptick has paved the way to the upcoming migration and the expansion of the Euronext Clearing to all Euronext markets. Combined with the successful migration to our new core data center in June last year that migrated from Basildon near London outside the European Union to Ponte San Pietro near Bergamo in the European Union and the recent internalization of the technologies powering MTS and Euronext Securities, we are now more than ever on the right path to build the only fully integrated trading value chain across Europe. And this development, combined with our innovation capabilities as the one we announced today in trading will further unlock opportunities for growth in the near future. As you can see it on Page 12, on Slide 12, as our performance has supported value creation for our shareholders, with the share price of our company increasing by plus 303% since the Euronext IPO in 2014 and outperforming some of our peers. Turning to Slide 14 to have a look at our ESG achievements. As you know it, we believe that Euronext must play a critical role to promote the evolution and I should even say, the transformation of companies to more sustainable business models. Therefore, we continue to advance on the different pillars of our Fit For 1.5-degree commitment. We pursue the deployment of our ESG offering as we continue to strengthen the ESG franchise of our national flagship indices. We also welcome additional issuers of sustainability-linked bonds on all markets and Euronext became the world's leading ESG bond venue in terms of issuance amount and number of issuers, reaching EUR 1 trillion of -- in sustainable bonds listed on all markets, clearly in Dublin, but also across all the other locations within the Euronext Group. But as a company, Euronext must lead by example. We started to deliver on own corporate ambitious ESG commitments with a successful migration to our new green core data center near Bergamo, that represent a key milestone towards FIT FOR 1.5-degree commitment. As everyone knows, this new core at center of the group is fully powered by green energy, by photovoltaic panels, by geothermal technologies and by 2 small hydropower plant nearby. And that's a great contribution to the reduction of the carbon footprint, not only of Euronext, but also of our clients that are co-located in this facility operated by Aruba near Bergamo. Furthermore, we continue to empower our people in many ways and let me just mention the fact that we continue to the program to grant 10 shares to all employees has now every single employee of Euronext is granted 10 shares every year at least, wide training sessions on climate issues, and continuous efforts to foster diversity and inclusion in the management team, where it is a permanent effort that takes time to materialize, but which is a fundamental and ambivalent commitment of the group. On Slide 4 (sic) [ 15 ]. Continuing with the ESG. As you may have already seen in our universal registration document, we disclosed our first set of carbon targets for Euronext as a company, in line with the Science-Based Targets initiative. These targets include an expected reduction by at least 53.5% of our Scope 1 and Scope 2 emissions by 2030 compared to the level of those emissions in 2020, as well as a reduction by at least 46.2% of our Scope 3 travel emissions by 2030 compared to the similar level in 2019. Let me underline, because I think it's extremely important, that these objectives will be achieved without any acquisition of carbon offset certificates. But just through fundamental changes in the way we operate our business, which raised the bar for delivery. I'm very proud that these ambitious targets were validated by the Science-Based Targets initiative earlier this year. Our commitment was also rewarded with the integration of Euronext in the CAC SBT 1.5-degree Index. This index invest solely in companies that set targets in line with the 1.5-degree goal of the Paris agreement. I'm looking forward to translate all ambitious carbon footprint reduction targets into concrete actions together with all the teams in the years to come. Let's have a look at the highlights of 2022, starting with Slide 17. I would like to highlight the performance of our listing business, which grew plus 15.1% and reporting solid listing activities with 83 new listing in 2022. In particular, we welcomed 20 international companies which is a recognition that Euronext is now the venue of choice for listing in Europe, in particular -- but not only, but in particular, in Amsterdam. In trading, the software volume environment -- the softer volume environment for cash equity trading in the second half of '22 was offset by efficient management of yield, and an uptick in market share from October 2022. We also recorded a very strong year for power and ForEx trading. Our post trade franchise significantly benefited from the consolidation of Euronext Clearing and Euronext Securities Milan, which were acquired as part of Borsa Italiana Group on 21 April 2021. The diversified business Euronext Equities allowed us to capture value as settlement activity stabilized in H2 2022. Furthermore, our Advanced Data Services business increased by plus 15.5%, refreshing growth across real-time and nonreal-time data business as well as index growth. Lastly, following the successful migration of our core data center to Ponte San Pietro in Bergamo in June 2022. We significantly scaled up our Technology Solutions business, reaching over EUR 100 million of revenue for this segment. This brings me on Slide 18, to our ongoing focus on cost discipline with the bigger picture on financials on this page. Thanks to a strong cost discipline and several positive one-off impact over the year. We overachieved our revised cost guidance of EUR 612 million, down from our initial cost guidance of EUR 622 million for 2022. Because for 2022, we reported EUR 606.1 million of underlying expenses, excluding D&A. And this was achieved despite inflationary pressure, which was already pretty strong in 2022. Consequently, our 2022 adjusted EBITDA grew double digit to EUR 661.6 million. And this translated into an adjusted EBITDA margin at 58.7%. So overall, this performance resulted in a 5.7% increase of adjusted net income to EUR 555.3 million. Adjusted EPS was down minus 4.8% to EUR 5.21 per share. And this reflects the higher number of outstanding shares of 2022 compared to 2021. On a reported basis, net income was up plus 6% to EUR 437.8 million. Consequently, a dividend of EUR 2.22 per share is proposed today for Board approval. And this dividend represents a payout ratio of 50% of reported net income adjusted to the EUR 49 million pretax or EUR 35 million post tax, one-off loss related to the partial disposal of the Euronext Clearing portfolio announced in Q2 2022. That's EUR 0.29 more than the '21 dividend per share, an increase of 13%. Moving to Slide 19. Despite inflationary pressure, our cost discipline will remain a fundamental component of our D&A for this year. In 2023, Euronext expects its underlying expenses, excluding D&A, to be around EUR 630 million compared to the annualized H2 2022 underlying expenses, excluding D&A of around EUR 620 million. This slight increase solely relates to growth initiatives to develop nonvolume-related activities. In other words, we expect the cost base of Euronext to remain stable, as cost savings and synergy will only -- will entirely compensate inflation and business development costs. Slide 20 shows our improved financial profile at the end of March 2023. From a balance sheet and debt perspective, our improved financial profile was recently recognized by S&P that upgraded Euronext to BBB+ in February 2023. We continue to -- our journey -- our deleveraging path with net debt to adjusted EBITDA at 2.2x at the end of the year, excluding cash in transit at Nord Pool. Finally, this brings me to our Q1 2023 performance starting on Slide 22. First, Euronext reported this quarter, a solid performance for the first quarter of 2023. Total revenue and income amounted to EUR 372.3 million in line with expectations. This performance was down minus 5.9% compared to Q1 2022 because as you certainly remember it, as everyone remembers it, Q1 '22 was a period of unprecedented volatility due to the job political situation in Ukraine, in particular, the invasion of Ukraine by Russia in February last year. And in Q1 2023, this year, our nonvolume-related business posted strong organic growth, now accounting for substantial 58% of our total revenue. Technology Solutions, in particular, grew by plus 19.4% driven by incremental colocation revenues in our new core data center in Ponte San Pietro in Bergamo. Advanced Data Services reported an organic growth of plus 7%, thanks to strong performance of our data business and our data solutions. And from a cost perspective, we reported EUR 153.8 million of operating expenses excluding D&A this quarter, a plus 7.1% compared to last year. So this cost performance is in line with our cost guidance for '23. And this cost performance demonstrates our continued cost discipline, despite inflationary pressures. As you might remember, in Q1 2022, our cost base benefited from a positive one-off, whereas in 2023, we incurred some costs for growth projects. Consequently, adjusted EBITDA was EUR 218.5 million, represented a 58.7% adjusted EBITDA margin for the first quarter of '23. Overall, this performance resulted in Euronext reporting its second-best quarter ever in terms of adjusted net income at EUR 147.1 million, and in an adjusted EPS of EUR 1.38 per share. So we continued a solid leveraging path and reached 2.1x net debt to adjusted EBITDA at the end of Q1 2023. Let's move to Slide 23 and briefly look at our business highlights for the quarter. Technology Solutions, as I said, Technology Solutions revenue was up plus 19.4%, resulting from the internalization of our colocation services following the migration of our core data Center in Italy. Advanced Data Services was up plus 7%, driven by an increased number of clients and improved revenue capture as well as the strong performance of the Data Solutions business. Listing revenue were slightly down, minus 1.2%, impacted by the depreciation of the NOK versus the euro. But in Q1 2023, Euronext confirmed its leadership for equity listed in Europe with a special recognition to the very strong performance of the IPO market in Oslo and in Milan. Post trade revenue were also slightly down, 1.9%, reflecting lower clearing revenue in NTI, while custody and settlement reported its best quarter ever. Lastly, trading revenue was down minus 14.5%, reflecting a normalization of market conditions against the record volatility levels reached during Q1 '22, [indiscernible] which [indiscernible] lower cash and rates revenues were partially offset by the strong performance of our fixed income and power trading activities. And with this, I will give the floor back to our Chairman.

Thank you, Stéphane, for your presentation. Agenda Item 3, Annual Report 2022. The annual report 2022 comes in the form of a Universal Registration Document in reliance on the grandfathering rules set out in Article 9, sub 3 of the EU Regulation 2017 119. Euronext filed its Universal Registration Document without prior approval of the AFM. Agenda Item 3A, explanation of policy on additions to reserves and dividends. The first item is the explanation of the policy on additions to reserves and dividends, which is a discussion item. I refer to the explanatory notes to the agenda of this meeting for more information on our dividend policy. We believe that Euronext is perfectly equipped to confirm its current policy to distribute 50% of its profits. In our view, this policy remains balanced and does not impair Euronext's flexibility to meet its short- and long-term liabilities and objectives. As explained in the explanatory notes to the AGM agenda, in July 2022, Euronext announced the Euronext Clearing reduced its investment portfolio with the aim of strengthening and preserving its available regulatory capital and aligning the investment strategy to the level of market volatility and uncertainty. As a result, Euronext recorded a post-tax loss of EUR 35 million in the third quarter of 2022. As the sale of the portfolio and no negative impact on the available capital of the group, Euronext announced the proposed dividend for the financial year 2022 will be adjusted to neutralize any negative impact from this operation. Before we proceed to the proposals to adopt the remuneration report and to adopt the financial statements, I would like to give the floor to Mr. Jasper Kolsters of EY, our external auditor for the 2022 financial statements. I point out that Euronext has waived the obligation of EY to observe confidentiality for the purpose of the AGM. Mr. Kolsters will briefly discuss the audit process and the procedures in relation to the audit of the financial statements and he's happy to take questions from the shareholders after his presentation. I kindly invite Mr. Kolsters to give our shareholders his views.

Mr. Chairman, thank you very much for the opportunity to discuss our audit. My name is Jasper Kolsters. I'm a partner at EY and the audit of 2022 is the first year that I've acted as the external auditor, replacing my colleague who had to rotate off due to independence considerations. Let's go to the first slide of our presentation. This is the topics that I want to discuss. I want to briefly touch on the audit approach, the way that we've organized our audit and are actually our audit procedures. Topic 2 is the key audit matters that we've included in our auditor's report; and lastly, the result of our procedures. We go to the next slide. There's quite a lot of information on this slide, and hope that everybody can read it, but the scope of our audit procedures is that we've audited the consolidated financial statement and the parent-only financial statements. We've also assessed whether the directors report meets the requirements under Dutch law and includes all the information that is required to be included. And lastly, we have also looked at a number of -- we performed an additional assurance engagement on the ESG KPIs included in the directors' report. I'm overall responsible for the audit of the group, meaning, of course, we don't do that -- I don't do that alone, but we have also involved our component teams, which are the audit teams of the various subsidiaries of the group and we also involve specialists in the audit, meaning we have a combined team where we work with our French colleagues and indeed, as I mentioned, the audit team of the components, but we involve valuation specialists, actuarial specialists and also, which is also very important as part of the audit team, our IT colleagues. The audit starts with determining materiality, and we've used an amount of EUR 30 million for the audit, which is the same number as last year and that number is based on profit before tax. Using that materiality and now talking about the approach itself, that's -- well, material is the starting point of the audit and then we determine which are the elements, well, that are most successful -- most likely to contain errors and then we determine our significant risk and fraud risks. Having done that, there are a number of topics that in every audit are very important, meaning that's a going concern assumption, but we also face specific attention, for example, to compliance of laws and regulations and fraud. So in those areas, we perform additional substantive procedures. If you talk about the ESG element, as I said, that audit is performed by a colleague, and you've seen the auditor's report included in the URD. And -- but it's the scope of the audit is slightly different than for a normal audit -- a normal audit where we provide -- well, on the ESG element, a lower level of assurance, meaning that we verified that something is -- well, we have not identified any specific findings in that respect. Talking about the key audit matters, that's on the next slide. We've identified 4 key audit matters. And that's -- the first one is the impairment testing of goodwill and other intangibles. The second item is the capitalization of software expenses relating to the various projects that the company is currently executing. We've assessed the fair value measurement of a number of the financial assets. And lastly, we focused on the audit of -- sorry, we focused on the reliability and continuity of electronic data processing. Going to the last slide of the presentation, so what are then our conclusions? We've established, we've issued an unqualified auditor's report on the IFRS financial statements. We've assessed that the Directors' report need all the requirements in the Dutch law. And lastly, we've provided limited assurance on the ESG KPIs included in the Directors' report.

Thank you. Are there any shareholders who have questions about the audit and the audit report of our external auditor?

Thank you, Chairman. My name is Carmen [indiscernible]. I represent the Dutch Shareholder Association and European Investors. I do have a few questions on the presentation by Stéphane, but that will come later, I presume. On the audit, one particular question. We just saw the key audit matters. And we heard Stéphane his ambition to be FIT FOR 1.5-degree -- the carbon emission reduction, 1.5-degree ambition for Euronext. Should this not be a key audit matter because this will be for all the those that list on Euronext, it will be or in the Scope 1, 2 or 3. And if you have the ambition as a company to be net 0, of course, the exchange should be net 0 in due course before 2050. Should this not be a key audit matter if you look at the going concern of an exchange that those listings should have the guarantee in a few years that Euronext will be net 0 as well?

Okay. Thank you for your question. I think it's a fair one. What you see in our auditor's report that we did report on the impact of ESG considerations on the financial statement itself, and we've concluded at least for this year's audit that the goals that have been set and the findings that we have do not have a significant impact on the financial statement itself. It could certainly be a key audit matter in coming years. But at this stage, we've concluded that it's still well presented in the way that it currently is in our auditor's report is still appropriate.

If I may complement? The ambitions or the objectives we collectively -- when I mean collectively, Euronext, the clients, the ecosystem, all of us in this room that we have to deliver are huge and they are very ambitious targets. So the best way to secure the delivery is to be consistent. And we are -- we have started a journey that is very ambitious with clear targets, clear transformation of our processes internally. I mean, I don't want to bore you with what is behind those objectives, but we are starting to have a carbon budget by teams to price carbon consumption for each travel and et cetera. We are already starting to make decisions on not doing certain trips till to save the carbon footprint, et cetera. So things are starting to do. But it's a fundamental transformational operation. So it's slow. So in parallel to set -- we set objectives, we change our process, we track KPIs. Over time, we will probably have to adjust KPIs. We adjust our internal accounting way of tracking those KPIs. We have a dialogue that is very fruitful with our external auditors as we have a dialogue with our internal control functions, internal audit, risk and compliance and internal control. And my hope -- and it's not a hope, it's a determination is that every year, we will improve and things that are a bit still fuzzy today will become super clear and what our ambition today are KPI of next year and so on and so forth. So it's a journey because we are pivoting the way of measuring the performance of the company. So you have to trust us on the commitment, you have to trust us on the determination, and we all have to be -- I wouldn't say patient, but to acknowledge that many things we do today will be done differently this year and definitely, and so we are moving from certain we are doing things to a new business as usual, hence, this transition.

Thank you. please go ahead with your questions for Mr. Boujnah in his presentation, please.

Okay? I can sit down there. Yes, I have a few questions. First of all, many thanks, Stéphane, for your keynote here. The execution of the pan-European strategy is delivering results. If you compare this to -- I think you just referred to the carve-out 9 years ago from ICE and NYSE. No one would have expected this to be the results of 2022, even people close to Euronext. So with your reappointment due in a few minutes or an hour, this is a convincing bio, Stéphane. And the past performance is very strong, and the reputation of Euronext is very strong. And many thanks for your contribution to that. The results over 2022 are very positive, much appreciated by the shareholders and the cost discipline, of course, continue the efforts. It's extremely important for an exchange and a key for the financial performance. Euronext for us, our shareholders and also retail shareholders is extremely important, not only here in the Netherlands, but pan-European scale. We want that capital market union to be delivered in Europe and use that the example how a pan-European exchange can contribute to that. So that's very important and also for retail shareholders, in particular, to have easy exchange to a convincing business case and a good performing exchange. The outages, I think last year, we referred to those. We had a few in the past. Over 2022, it was silent. So all the efforts you put in the business continuity, we've seen that as well. So that's much appreciated as well. Also, the engagement activities, not only by you, but also by here Simone and national level, but also at European level, I think that pays off. Also the preparation of this meeting, where we had a meeting with Ma'am MacCulloch on the remuneration, which will come later. Of course, that is the way to go. And Euronext is setting the example how you can have a close connection and good engagement with the shareholders. Also, the Intellian integration, of course, a key topic for last year. We've read it and you just also referred to that, that is going according to plan, and we see the financial impact of that as well. ESG just referred to the role of the auditor, but Euronext is well performing, set an example. And as I just mentioned, I think it's crucial for the next, let's say, 5 to 10 years, because you will see more and more companies that needs to pay a lot of attention to, especially the carbon footprint and also new entrants, new listings, new benchmarks, which will hopefully be listed on Euronext as well. And Euronext should be the marketplace of choice. And the more you can do in the reduction, the more benefits they see in Scope 1, 2 and 3 by making the selection for Euronext. So also for shareholders it is key that Euronext is pushing for its own carbon footprint and to limit that as well. So that is, in our view, very important. One question is left. That was the Q1 results. We understand that in Q1 2023, if you compare it to last year, you will have a slight decrease in the financial performance due to the volatility, you rightly explained that. But it was one-off, the EUR 36 million, which were -- which is cost, which is proficient for the contract with LCH. And the question I have is on this. Is this a one-off which will, in Q2, Q3, Q4 be compensated by the financial results coming from Bergamo and Aruba there, or is this really a hit which we can expect to be a hit over the full performance of 2023? And could this hit have been prevented because the ambition was always to have your own clearing? And why is such a -- it's a material amount, 36, not for the auditor almost, but it's material for the shareholders. So can you give us a bit of background on why this had to be paid or will be paid and what will be the impact on the financial results over the full year?

First of all, thank you very much for your nice words about what has been achieved. I can remember that the first time we've met was in March '16 in this building when you were responsible for advising the Ministry of Finance in the negotiation of the capital requirements applying at holding level and when Giorgio Modica, the new CFO of the group, was negotiating with you and the Minister of Finance a sort of balanced solution that we found out together. So as you can -- as you say, at that time, when we were discussing these issues, we could not contemplate that we would be here commenting results of a company with a EUR 1.5 billion top line and a market cap between EUR 7 billion and EUR 8 billion. So -- and the credit for that goes to all the teams that have worked very hard across the group. I mean I've been privileged and honored to be part of this team. But honestly, the efforts done across the group in the core Euronext deals, but also within the teams that joined us in Ireland in Oslo in Copenhagen in Italy, but also teams in the U.S., in Singapore and the smaller teams in Finland and Sweden, et cetera, have worked extremely intensively to make that happen. So thank you for your nice words. The credit goes to them. As far as your question on the one-off termination fee that we paid to LCH Limited in relation to the termination of the clearing derivative agreement, that's totally part of the restructuring costs that are announced in relation to the targeted synergies. So we have a total amount of synergies, which is now going to be EUR 115 million by the end of '24, that includes all the benefits in terms of cost of revenues of the various migrations that we have been doing and that we will be completing in '23 and '24. And in front of that, we have a targeted amount of restructuring costs that of EUR 160 million -- the EUR 150 million sorry, EUR 150 million of total restructuring costs. And this EUR 36 million ticket is part of what has been planned. So there is -- everything is happening so far according to plan. And if I may -- I check your questions to highlight that the migration of clearing is developing as planned. The first step will take place after the summer during Q4 '23, and the platform is already available for testing by clients. So on the technology front, we are very well advanced. And the teams in Rome and Paris both are doing a fantastic job to be ready on the technology front. On the client readiness front, things are proceeding extremely well as well with a very intense work done by the global sales teams and the various teams across the group, in particular with where the clients are located, which, to a large extent, is in London. And on the supervisor support front, we are working very closely with the relevant supervisors from the "legacy clearing world" in France with the IMF and the Banque de France and mainly to the recipient and with and Banca d'Italia and things are being smooth all that in -- with a sort of constructive dialogue with us. We will be there on time and on budget. And at that point, I want to maybe give the floor to Giorgio to add a precision.

Just one clarification. We committed to pay the EUR 36 million, but we have not paid the EUR 36 million, which means that these amounts are going to be eligible next year. So when we will pay the EUR 36 million, we will also benefit from the full advantage of the clearing migration, which will give to us in excess of EUR 40 million per year against the payment of EUR 30 million. So as far as 2023 is concerned, we have the accounting costs, but no outflow. Next year, we will have the positive impact from the full clearing migration together with the payment. I wanted to clarify that.

I hope it answers your question.

It certainly does.

Very good. Thank you. I'd like to thank Mr. Kolsters; and Mr. Boujnah and Mr. Modica for their contributions and explanations and proceeds to agenda Item 3B. Voting Item 1, proposal to adopt the 2022 remuneration report. In accordance with Article 2:135b paragraph 2 of the Dutch Civil Code, the remuneration report is submitted to the meeting for an advisory vote. We will now proceed to the advisory vote on the remuneration report, which is the first voting item. Are there any shareholders who have questions about the 2002 remuneration report? Please.

Yes, I think the remuneration, as I just referred to, we had some engagement prior to this meeting. I think I'm convinced that it's well considered. If you look at the benchmark in the 3 columns, it's agreed, it's a good benchmark. The fixed annual -- for annual fixed salary, we understand that. The short-term incentives with a maximum of 1.5x the annual fixed salary. We can agree with that as well. And what is, I think, very wise and good to do is to introduce that threshold of 70%. So if you have performed less than 70% and the whole variable pay will not be due for Euronext. And I think that is a very important element for the alignment of interest between the company and its shareholders. Then the performance criteria. There is the, I think, almost over the whole range to 20% ESG performance criterion, which is, I think, very good, but make these as challenging as possible because like I just referred for Euronext, I think this is a challenge. You're on track. You set the example. But the more you can do, I think it will be decisive in future listings as well. So the reduction in carbon emissions should continue. And also on the social and governance, let's not underestimate. It's also to be the employer of choice, to be a safe working environment and for the enscrow part you take in the capital markets and the ecosystem in Europe, I think ESG is extremely important. So keep up the pace there. There's one question I have for Ms. Rachou or perhaps you want to -- and that is succession planning. Let's anticipate that Stéphane, I just had some nice words for him, so he will get our vote for the reelection. But for the next 4 years, of course, this will be normally his last term of 4 years. So there is always tension about succession planning. So what has been included in the criteria to make sure that the succession planning in the next 4 years or after 4 years, will be in line with the interest of Euronext in the interest of the shareholders? Has this element been included in the remuneration package for -- especially for Stéphane? So that's the question I have. Apart from, let's say, the agreement with the remuneration package and also of the remuneration policy then.

Very good. Thank you for the question. I will make an introductory remark, and then pass the question to Ms. Rachou as you indicated, as also Chairman of the Nomination and Governance Committee. I just wanted to share and communicate that we have done an extensive amount of work with the management team, really detailed work in on succession plans for the entire managing board, but also specifically, of course, on Stéphane. So just to reassure you that a lot of detailed diligent work has been done. And so far, for example, on the basis of the changes that we have experienced last year and with the appointment upcoming, hopefully, right now for the new COO, I think that will demonstrate that -- the work that has been done has been always very rigorous and every replacement have been seamless. But with that, I would like to have Mr. [indiscernible] offering her thoughts as well, please.

Well, I can confirm that in the 2023 objectives for Stéphane, there is a very precise line, prepare your succession. And that's going to be an ongoing objective throughout his term. This is an ongoing process, and we are not going to appoint -- the 4-year ahead CEO, of course, but it's definitely among Stéphane's objective for the STI, and we'll keep it there until we finalize the succession plan. So definitely along your thoughts.

Thank you for that. If there are no further comments or questions, then we can proceed with the Voting Item 1. Are there any shareholders who wish to vote against the proposal to adopt the 2022 remuneration report? Are there any shareholders who wish to abstain from voting? Shareholders who wish to do so are asked to raise their hand and show the card with the number that you have received at the registration desk. Please mention your name and indicate whether you want to vote against or abstain from voting. If you are a shareholder who wishes to cast votes both in favor and against, and who wishes to abstain for other votes, you are kindly requested to mention your name, the total number of shares you represent. And for how many shares you vote against the voting item, for how many shares you wish to abstain, and if any, for how many shares you vote in favor. This procedure will be followed at each voting item and will not be repeated.

Thank you, Mr. Chairman. My name is Christo [indiscernible] and I'm here representing OPTAVIA, the company's registrar and in turn, representing [indiscernible] for us and in turn representing in this meeting in total, 85,226,977 shares. I inform the meeting that we have been instructed to vote as follows: 3,737,400 votes against this item, 1,475,329 votes as abstentions and 80,014,248 votes in favor of this item.

Thank you. If there are no further votes against and no further abstentions, I assume that the remainder of the votes are in favor. I conclude that the proposal to adopt the 2002 remuneration report has been adopted. We will proceed to the next item. Agenda Item 3C, Voting Item 2, proposal to adopt the 2022 financial statements. The second voting item in this meeting is the proposal to adopt the 2022 financial statements. Are there any shareholders who have questions about the proposal to adopt the 2022 financial statements? I note that there are no comments are made and no questions are asked. Voting item 2. Are there any shareholders who wish to vote against the proposal to adopt the 2022 financial statements? Are there any shareholders who wish to abstain from voting? I refer to the voting procedures as explained at the first voting item, so please raise your hand, and show us the card with the number, if you wish to do so.

I inform the meeting that we've been instructed to vote as follows: 1,370 votes against for this item, of course; 123,506 votes as abstentions; and 85,102,101 votes in favor of this item.

Thank you. If there are no further votes against and no further abstentions, I assume that the remainder of the votes are in favor, I conclude that the proposal to adopt the 2022 financial statements has been adopted. We will proceed to the next item. Agenda Item 3D, Voting Item 3. Proposal to adopt a dividend of EUR 2.22 per ordinary share. The third voting item in this meeting is the proposal to adopt a dividend of EUR 2.22 per ordinary share. Are there any shareholders who have questions about the dividend proposal? I note that no comments are made, and no questions are asked. Voting item 3. Are there any shareholders who wish to vote against the proposal to adopt a dividend of EUR 0.22 per share. Are there any shareholders who wish to abstain from voting?

I inform the meeting that we've been instructed to vote as follows: 1,101 votes against this item; 1,360 votes as abstentions and 85,224,516 votes in favor of this item.

Thank you. If there are no further votes against, no further abstentions, I assume that the remainder of the votes are in favor, I conclude the proposal to adopt a dividend of EUR 2.22 per ordinary share has been adopted. We will proceed to the next item. Agenda Item 3E, Voting Item 4. Proposal to discharge the members of the Managing Board in respect of their duties performed during the year 2022. The fourth voting item in this meeting is the proposal to discharge the members of the Managing Board in respect of their duties performed in year 2022. Are there any shareholders who have comments or questions about this item? I note that no comments are made, and no questions are asked. Therefore, voting item #4. Are there any shareholders who wish to vote against the proposal to discharge the members of the Managing Board in respect of their duties performed during year 2022. Are there any shareholders who wish to abstain from voting?

I inform the meeting that we've been instructed to vote as follows: 2,499,850 votes against this item; 197,216 votes as abstention and 82,529,911 votes in favor of this item.

Thank you. If there are no further votes against and no further abstentions, I assume that the remainder of the votes are in favor. Therefore, I conclude that the proposal to discharge the members of the Managing Board in respect of their duties performed during year 2022 has been adopted. We will proceed to the next item. Agenda Item 3F, Voting Item 5. Proposal to discharge the members of the Supervisory Board in respect of their duties performed during the year 2022. The fifth voting item in this meeting is the proposal to discharge the members of the Supervisory Board in respect of their duties performed during the year 2022. Are there any shareholders who have comments or questions about this item? I note that no further comments are made, and no questions are asked. Voting Item 5. Are there any shareholders who wish to vote against the proposal to discharge the members of the Supervisory Board in respect of their duties performed during the year 2022? Are there any shareholders who wish to abstain from voting?

I inform the meeting that we've been instructed to vote as follows: 2,600,590 votes against this item; 197,216 votes as abstention; and 82,429,171 votes in favor of this item.