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

Good morning to everyone. Dear shareholders, I hereby open the Annual General Meeting of Euronext N.V. My name is Piero Novelli, and I am the Chairman of Euronext Supervisory Board. I welcome you all on behalf of the Supervisory Board and the Managing Board of Euronext N.V. for our tenth Annual General Meeting as a listed company. Please turn off or mute your mobile phones during the meeting or forget it as I've done. Euronext N.V is an international company, its corporate language is English. Therefore, the general meeting will be conducted in English as announced in the convocation to the meeting. Hereinafter, I will refer to Euronext N.V., either as Euronext or the company interchangeably. I would like to inform you that most of the members of the Supervisory Board, the CEO, Mr. Stephane Boujnah, the CFO; Mr. Giorgio Modica; and the General Counsel and 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, 2 members of the Supervisory Board, Ms. Alessandra Ferone and Mr. Olivier Sichel are unfortunately not in the position to attend this meeting. Also present in the room are the nominees for appointment to the Supervisory Board, Ms. Fedra Ribeiro, Ms. Muriel De Lathouwer and Mr. Koen Van Loo. As well as the nominee for appointment to the Managing Board, Mr. Simon Gallagher. 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; Mr. Jasper Kolsters, the lead partner, EY, our external accountant for the 2023 accounts and Mr. Waldo [ Bocker, ] the lead partner KPMG, which is proposed to be our external accountant for the 2024 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 20th of March 2024 on Euronext website, including the agenda and explanatory notes thereto. This announcement explained the procedure for shareholders who wish 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 additional 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 3 subsequent 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 Associations 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 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 with a number of issued shares as at the registration date, which was the 17th of April. I will now announce the relevant numbers for today's meetings. Issued share capital as per the registration date, 107,106,294 shares. Shares with voting rights, 103,634,263 shares, represented shares, 86,281,623 shares. Percentage of the issued capital present or represented, 83.25%, absolute 50% plus 1 majority of the votes, 43,140,813 shares. Qualified 75% plus 1 majority of the votes is 64,711,218 shares. Agenda Item 2, presentation of the Chief Executive Officer. I first invite the CEO and Chairman of the Managing Board Mr. Stephane Boujnah to present the report of the Managing Board on the financial year 2023 and the Q1 2024 figures.

Thank you, Mr. Chairman. Thank you, Mr. Chairman, and welcome, everyone. I will start with some highlights on the past decades for 1 simple reason, which is that we are celebrating this year. The 10 years since the IPO. And the long-term perspective is quite critical in terms of value creation. And I will then briefly present to you our '23 performance and conclude with the status update on the integration of the Borsa Italiana Group and our Growth for Impact 2024 strategic plan. So I'm now on Slide 4. As we celebrate this year, the 10 years of our IPO, I would like to take a step back to look at what our Euronext has achieved, thanks to your support over this past decade. Through this journey, we delivered on our ambition to build the leading pan-European market infrastructure. Euronext is today the first equity listing venue in Europe, the first cash equity trading venue in Europe and the first bond listing venue not only in Europe but worldwide. And we now operate strong assets in fixed income with MTS, and we operate strong trading assets with fully owned multi-asset classes, clearing house like Euronext clearing and the third largest CSD network in Europe. As you can see Euronext is today, the leading, diversified pan-European market infrastructure. Moving to Slide 5. Over the past 10 years, we expanded into new asset classes and new activities to diversify and strengthen our revenue mix. We have also widened our geographic footprint, well beyond the Euronext historical and domestic stock exchanges presents well beyond the home of Euronext legal headquarter, Amsterdam. But most important, we successfully consolidated into European capital markets infrastructure to create the backbone of the European Capital Markets Union or what is to become the European Savings and Investments Union. Over the past 10 years, we delivered on our ambition to build the leading market infrastructure in Europe. Moving to Slide 6. The numbers speak for themselves and illustrate the significant change in size of Euronext. First, from a financial perspective, the market capitalization increased 6.7x since the IPO 10 years ago. Revenue more than tripled and we sustained our trademark cost discipline to materially increase profitability of the group. Second, as I mentioned, we expanded activities across geographies. The group today derives around 60% of its revenues from non-volume-related activities. This improvement in our revenue mix both geographically and in terms of segment results from organic growth and successful bolt-on acquisitions. Third, we position Euronext as the leading market infrastructure in Europe. Euronext is today as I mentioned earlier, the leading venue in Europe for equity listing, we're close to 1,900 issuers. We are also the leading bond listing worldwide hosting over 57,000 bonds in our market, mainly in Dublin, but also in other locations. Lastly, we are the leading cash equity trading venue in Europe, powered by a single state-of-the-art technology platform, Optiq, which enables a single order book, which empowers a single liquidity pool. All of this would not have been possible without the Euronext teams across Europe that's supporting this transformation over the past decade. The group significantly evolved from an operational perspective. We have tripled the number of employees, most of them joined to the several acquisitions we're engaged in, while others were on-boarded to support organic growth projects. I'm now on Slide 7, which should be a source of collective pride for the teams that worked so hard over the past 10 years. This transformation was not made at the expense of our profitability and value creation. Since our IPO, we have established a non-recognized trademark cost discipline and a unique track record at integrated acquired companies. Over the past 10 years, we have delivered EUR 217 million of synergies, and this is not over. By the end of '24, we will have delivered an additional EUR 36 million of synergies as part of the integration plan of the Borsa Italiana Group. All in all, between 2014 and 2024, we will have delivered over EUR 250 million of synergies. This strong performance on Slide 8, translating into superior value creation for our shareholders. Since IPO, the share price increased by close to 400%. In the meantime, our strong cash generation capabilities enabled us to return EUR 1.5 billion to our shareholders through annual dividend payments and through the share repurchase program carried out last year. Moving now to the highlights of the 2023 performance on Slide 10. Thanks to our diversified business model, we achieved plus 3.9% increase in revenue and income to reach close to EUR 1.5 billion of revenues. This performance was notably supported by our non-volume-related activities that accounted for 60% of total revenues. Following the successful migration of our core data center in Bergamo in 2022, we continued to bear the fruit of this migration, notably with our co-location offering. In 2023, we further scaled up our Technology Solutions activity that grew close to 10% in 2023. Our Advanced Data Services business. We reported strong performance with revenue plus 6%. This results from good performance across the data products offering and also solid demand for our data analytics products. Our post-trade franchise delivered a robust year as well. First, our custody and settlement business grew by plus 5.5%. Like-for-like at constant currency. This was driven by growing assets under custody, improved revenue capture and continued expansion of the services business. On a reported basis, this activity was impacted by negative ForEx impact from the NOK. Second, our clearing revenue were stable despite declining activity and derivatives volume. This results from 2 key factors. First and foremost, our clearing flows are now diversified. As a result, the strong fixed income clearing and modes clearing activities, partially offset the lower equity and financial derivatives clearing. Then and what is the most important for all of us, we managed to capture additional business at Euronext clearing following its expansion to all Euronext cash markets. Since 27 of November, Euronext clearing is the preferred CCP for 6 European cash markets. Last, the net treasury income increased by 6% compared to 2022. Underlying net treasury income primarily reflecting higher collateral held by Euronext companies. Once again, we remain the leading listing venue in Europe for equity, attracting 64 new equity listing, which represent approximately 40% of all the listings implemented in the European continent. We also consolidated our position as the leading listing venue for that worldwide now being the home, as I mentioned earlier, over 57,000 bonds. Our Corporate Services franchise continued to post double-digit growth, demonstrating the successful expansion of our SaaS offering. Lastly, our trading franchise was resilient, despite a lower volatility environment for equities. Indeed, while cash trading and derivatives trading volumes were down by over 10% total trading revenues only decreased by minus 4.7%. This is, again, the demonstration of a much more diversified business model. In 2023, our fixed income trading business reported a record year with double-digit growth in all asset classes, resulting in revenue up plus 15.6%. In addition, our power trading business also posted a record year with revenue up plus 14.5%, primarily supported by intraday power trading, where volumes doubled compared to 2022. As I just said, 2023 demonstrates a critical result of Euronext diversification. We delivered solid growth even in an environment which was not favorable to equities. I'm now on Slide 11. We obviously maintain our trademark cost discipline and report better-than-expected cost at EUR 610 million, less than 1% above 2022 despite inflationary pressures that we all experience in our respective businesses. This also compares -- this cost performance compares to the revised guidance of EUR 618 million, and the initial cost guidance for '23 provided a year ago of EUR 630 million. So cost of performance is very often taken for granted because you are used to it, but it comes with a lot of efforts for the teams, especially in a strong inflationary environment. This good performance on costs despite inflationary pressures resulted from cost control and also some positive ForEx impact and the one-off accrual release Consequently, our 2023 adjusted EBITDA grew to EUR 864.7 million, and we delivered an adjusted EBITDA margin at 58.6%. Thanks to the positive interest rate environment, our strong cash position enabled us to fully offset the cost of our debt as a result and supported by EUR 53 million of capital gain. Reported net income increased plus 17.3% in 2023 to EUR 513.6 million. Adjusted for non-underlying items, net income was up plus 5.3% to EUR 584.7 million, representing an adjusted EPS, EUR 5.51 per share. Consequently, a dividend of EUR 2.48 per share is proposed today. The dividend represents a payout ratio of 50% of reported net income as set up in our dividend policy. That's EUR 0.20 more than the 2022 dividend per share and an increase of plus 12% in the dividend. To conclude on Slide 13, a status update on the integration of the Borsa Italiana Group. In 2023, we delivered several strategic milestones that were critical for us to achieve our transformation in '24. First, on the trading side, we successfully completed for the fourth time since our IPO in 2014, the migration of cash equity markets to a single technology trading platform Optiq. The migration of Italian cash markets to Optiq created benefits for trading members, increased liquidity in the Italian market with a material improvement of the Italian market quality overall. Second, we made very good progress to further strengthen our post-trade business. In November '23, we took an important step towards the European expansion of Euronext clearing, expanding our offering on schedule, on budget to the cash markets in Belgium, France, Ireland, the Netherlands and Portugal. Euronext clearing now clears equities, ETF, structured products, warrants and bonds across 6 European markets. Third, in March '24, we successfully migrated Italian derivatives trading operations to Optiq. This migration was the last in the ambition integration plan of Italian cash and derivatives markets onto the Euronext single trading platform. And it was completed less than 3 years after the acquisition of the Borsa Italiana Group completed in April '21. All these milestones contributed to reaching EUR 79 million of run rate EBITDA synergies at the end of March '24 in relation to the acquisition of the Borsa Italiana Group. And let me remind you that the initial target for the end of '24 when the completed the transaction was to deliver EUR 60 million of run rate synergies by the end of '24. And we have already delivered EUR 79 million by the end of -- by the end of the first quarter '24. So we are clearly on the right path to deliver the revised guidance for synergy, and you will have understood that we are really on track and on schedule to deliver the last step of our Growth for Impact 2024 strategic plan the expansion of Euronext clearing to all financial commodity derivatives listed and financial derivatives listed on our European markets in the third quarter of '24 in a few weeks' time, will be the final step to achieve the targeted delivery of at least EUR 115 million cumulative EBITDA synergies at the end of '24, which close to double the amount of synergies that were initially anticipated when the deal was completed. Finally, on Slide 14, the completion of our Growth for Impact '24 strategic plan will position Euronext as the only fully integrated trading value chain across Europe with leading positions across all of our activities and powered by our own technology infrastructure. So as we celebrate the tenth anniversary of our IPO, we are looking forward to exploring in-depth the opportunities that this transformation will offer for Euronext at our Investor Day that will take place on the 8th of November in Paris and that will set the ambition for the company for '25, '26 and '27. And with this, I give back the floor to our Chairman.

Thank you, Stephane, for your explanations. Agenda item 3, annual report 2023. The annual report 2023 comes in the form of a universal registration document in reliance of the grandfathering rules set out in Article 9, sub-3 of EU regulation 2017, 1129. Euronext filed its universal registration document without prior approval of the AFM. Agenda Item 3A, updated Dutch Corporate Governance Code. The first item is the confirmation that Euronext has incorporated the changes included in the Dutch Corporate Governance code into the 2023 URD. The changes entail increased attention to sustainable long-term value, diversity and inclusion, the role of shareholders and some other changes. I refer to the explanatory notes to the agenda of this meeting for more information on these items. Are there any shareholders who wish to further discuss this item? If not, we will proceed to the next item. Agenda Item 3B, explanation of policy on additions to reserves and dividends. The second 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. Are there any shareholders who wish to further discuss this item? If not, we will proceed to the next item. Before we proceed to the proposals to adopt the remuneration report and to adopt of the financial statements, I would like to give the floor to Mr. Jasper Kolsters of EY, our external auditor for the 2023 financial statements, please. 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 procedures in relation to the audit of the financial statements and is happy to take any questions from the shareholders after this presentation. I kindly invite Mr. Kolsters to give our shareholders his views.

Mr. Chairman, thank you very much. And perhaps we can go to the tax slide already. Indeed, so my name is Jasper Kolsters. I'm a partner at EY. And this is the second year that I've audited Euronext's financial statements. And dear shareholder, I would like to address a couple of topics with you. First, I want to talk about the scope of our engagement. Secondly, I want to talk about the key order of matters and a number of ESG-related items. And lastly, I want to discuss the communication process and the way that how we've worked with management, management board and also the Supervisory Board. But let me go to the next slide. And it's quite a detailed slide, but it gives an overview of the work that we've done and how we've done it. But let's start with the scope of our procedures. We've audited the statutory and consolidated financial statements of Euronext. In addition to that, we've also performed a review of the interim financial statements as at the end of June 2023. And lastly, we've also performed an assurance engagement on a selected number of ESG KPIs as included in the management Board report. In addition, if you talk about the Management Board report, there are a number of topics that we've assessed. And we've performed slightly different audit procedures, but we've looked at the corporate governance information, the risk management information, and for example, the remuneration paragraph. If you talk about the execution of the audit as the statutory auditor, it's my role and responsibility to organize and structure the audit in such a way that we've obtained a sufficient and appropriate audit evidence. And an important element of that is, of course, getting a team ready to do so. And in that team, we have a number of people with specific knowledge. For example, if you talk about IT audit or elements relating to -- let me give me a second. Specific knowledge, for example, on IT. And in addition, we have also had a number of specialists for example, if you talk about the valuation of financial instruments and impairment testing. An important element of an audit is determined materiality. We've used an amount of EUR 34 million for the audit of 2023. We've based that materiality threshold on profit before tax. And the number, and I think that's relevant for you as shareholders. We've -- the number is quite comparable to the number used in 2022, which was EUR 30 million, which was determined on the same basis. Well, using that materiality, as you see we perform our risk assessment. And based on that, we select components, meaning the various businesses of Euronext that we include in our audit. And as part of doing that, we send those teams that are responsible for the audit of those components, instructions, and we monitor the way that they perform their work throughout the audit. In an audit, there are always a number of specific topics that we assess, for example, [ the go ] and concern assumption, which is a key assumption in preparing the financial statements. And we also perform specific procedures in respect of fraud and compliance with laws and regulations. And as you do that as part of every audit, but it's, of course, an important element. We'll talk about ESG in a second. And -- but perhaps then let's move to the conclusion because I think that is probably most relevant as part of our audit, and we've assessed the assumptions that management has applied the estimates made. And we've concluded that we consider those to be seasonable and that results in an unqualified auditor's report on the consolidated and parent only financial statements, and we've also concluded that the information included in the Board report is consistent with the financial information and in that respect, appropriate. Let me then briefly touch upon the key audit matters. Of course, our auditor's report is included in the URD, which is quite an extensive document. But if you talk about the audit, what are the most important elements in our audit and the assessment of the impairment analysis prepared by management on goodwill and the other purchased intangible assets. If you look at the balance sheet of Euronext is about EUR 4 billion and goodwill and EUR 2 billion in other acquired intangibles, which, of course, are very significant amount. So therefore, an important focus area in our audit. Also, the recognition of internally developed software is a focus area because if you talk about 2023, one of the key, and I think that was also referred to by the management Board already. Key objects were the implementation of Optiq in Italy and the rollout of Euronext clearing. And of course, as we've read, that is also reflected in the financial statements and part of the costs are then capitalized. So there's a bit of judgment involved. So our role is to assess whether the IFRS criteria have been applied appropriately. Another important element in our audit is the measurement of financial instrument accounted for at fair value, Euronext as an investment in Euroclear, that is accounted for at fair value in the balance sheet. So what we do is we assess whether the assumptions made in that valuation are reasonable. And lastly, of course, IT is very important in this audit, and we've assessed whether the IT environment and controls are adequate for us to perform our and to rely on as part of our audits. If you talk about ESG, as I mentioned, we've performed a separate assurance engagement. But what we do, and of course, given the development, for example, on CSRD, which will be applicable in 2024, what we've assessed is to what extent have climate change and transition risk have an impact on the 2023 financial statement. What we've assessed is that although they are very important topics and get sufficient attention but do not necessarily have a significant impact made on the valuation, for example, our estimates made in the 2023 financial statements. Lastly, we've performed, and you've seen that in the financial statements as well. There is a separate assurance report where we provided limited assurance on a number of KPIs. And there, we've concluded. So it's a conclusion, not an opinion, but we have not identified any significant differences in those KPIs. If you go to the next slide, if you talk about communication during the year because it's an audit of a listed entity, certainly like Euronext takes quite a lot of time, and we're involved in the audit throughout the year. So we've issued a number of reports. For example, we discussed our audit plan with the Supervisory Board in May 2023. But throughout the year, we issue, for example, on the half year review, we issue a report and we issue a management letter on any findings in respect of internal control. And if you talk about the year-end process, we issue a long-form auditors report with our findings and observations on the 2023 financial statements, and we did that in March 2023. So as I said, we meet management, management Board and the Supervisory Board throughout the year. And I think it's important for you also to understand that, that process goes smoothly. That the communication is open, it's transparent. And I think at times, of course, critical as well, which I think improves of the quality of the audit that we perform. Having said that, I think it's -- more or less to the end of what I wanted to say, and I want to hand back the floor to you Piero.

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

Thank you, Chairman. My name is [ Herman Averts ] I represent the Dutch Shareholder Association, The VEB. Many thanks for the presentation. It's always good that the auditor is present in our midst as a general meeting. Many thanks for your audit over the last years. It's also the last possibility for us to raise any questions on, let's say, consecutive years. So I have 2 questions. You referred to the management letter, which is always distributed to the Board and the non-executives on a yearly basis. What were the most important 3 elements of the last management letter? And a second question on, let's say, the follow-up of the recommendations of the auditor. What's your opinion on, let's say, the follow-up, the mitigation of any risk you have signaled in, let's say, the penultimate management letter? Was Euronext able to mitigate it's most important risk according to your interpretation and knowledge?

Okay. Mr. Kolsters, please.

Okay. A management letter contains observations on internal control. which I think is also something which is continuously developing, meaning it's not a fixed. It's not -- you're never done with an internal control framework. So I think important element so that were observations on how internal control is organized within the entity. Second -- and I think if you talk about what are other important topics, I think an important topic is IT, meaning there's significant IT involvement in the business itself, but also where we start using that in our audit. I think that is an important element. And well, I think we have observations on risk and compliance as well as we do in every management letter. And I think it's important to note, as I tried to explain it already earlier, is the way that we communicate with management, Management Board and the Supervisory Board is that our observations are taken seriously and are being addressed. And as I said, it's -- internal control is a living beast, meaning that it is continuously developing and of course, based on changes in requirements as well. So that is a -- it's something that continues to develop.

If I may, 2 short follow-up questions. But your assessment on the ability of Euronext to mitigate any risks you have signaled in, let's say, the former management letters. Is it, let's say, best in class? Is it according to or did it sometimes significantly impact the possibility of the auditor to apply a system-oriented audit approach?

Is it -- I think that's qualification -- a, you're asking for qualification, it's always a little bit difficult, meaning you can't necessarily compare the companies that easily. But I would say that -- and I think I tried to explain it as well is that I think it is -- management is making every effort to address the comments that we have. And I think they are addressing in an appropriate manner.

Okay. Thank you. If there are no other questions for our external auditor, I kindly thank Mr. Kolsters for his contributions and thank EY for their services in the past years. Thank you.

Much appreciate it.

Agenda Item 3C, Voting item 1, proposal to adopt the 2023 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 on the agenda. Are there any shareholders who have questions about the 2023 remuneration report? Please.

Thank you, Chairman. [ Herman Averts ] once more. So there's no explanation coming from the Remuneration Committee, yes? So we immediately jump into the questions. Okay. Good. As retail shareholders, we are always very happy to be here for our -- as per today, 29,776 members. We need to be precise because we're criticized as we have always been referred to 30,000, but more or less 30,000. Euronext is the marketplace of choice for many of them. Overall, there is not so much controversy since the 10 years that you're in excess of stand-alone status. However, this year, there is, and Possibly not to any surprise. In our view, the remuneration report includes a controversial matter. And this is the special one-off integration long-term incentive for the CEO and the COO. We can't blame the CEO and the CEO but still can blame the non-executives. The remuneration report states that in exceptional circumstances, Supervisory Board may grant specific remuneration to serve the long-term incentive -- interest sorry, and sustainability of the company. And the Supervisory Board mentions that it has decided to grant a special one-off integration long-term incentive for the CEO and COO. And the rationale behind this was, amongst others, to recognize specific integration milestones to reinforce retention and support the next phase of growth of Euronext. And much to our surprise, the Supervisory Board also cites some specific senior management retention risks. In our view, discretionary grants is unnecessary, ill explained and inappropriate. I therefore have the following questions. First, why there be any retention risk? CEO and the COO, and we agreed with that, were reappointed for another 4-year term just last year here at the [ Fairy ] premise, including an upward adjustment in the remuneration package on which we agreed and with nice words because we really appreciate their continuity. So have Mr. Boujnah and Bento threatened to leave the company in case they were not granted additional compensation? So that's question one. Secondly, the grant in itself also raises ample questions. For example, the acquisition of Borsa Italiana and the realization of synergy targets is already a separate performance criteria in the consecutive short-term and long-term incentive plans in the latter as part of example, the EBITDA targets. Why would this warrant a special discretionary ground as well on top of the implementation of the regular remuneration policy? Isn't this a clear example of being paid twice for the same performance, double counting in the denominator? Thirdly, the Supervisory Board mentions specific contributions to the delivery of the integration plan of Borsa Italiana, what exactly does the Supervisory Board mean? And why would the specific contributions not already be covered in the STI scorecard? And is the impression founded that this conversation is merely needed to compensate with a lower-than-expected performance of Euronext post merger. The share price of Euronext has not responded too well on the acquisition. In other words the price paid was perhaps relatively high and the synergy is not yet achieved in full? Is this a legitimate reason to grant additional remuneration to compensate for not having achieved the targets that were defined beforehand? And the last question on behalf of retail investors, why didn't the Supervisory Board conclude that it would be more appropriate, and it can be argued according to the law, it is even necessary that a separate shareholder approval is needed for this grant? According to the remuneration report, the Supervisory Board has used its powers to deviate from the remuneration policy in case of exceptional circumstances. However, according to the Dutch legislation exceptional circumstances can only cover situations where the derogation from the remuneration policy is necessary are quoted to serve the long-term interest and sustainability of the company as a whole or assure its viability. I really doubt whether the extraordinary LTI grant is necessarily to do that as both individuals, as I said, just signed a new employment contract only last year and no significant internal nor external threats can be distinguished. Therefore, we are of the opinion that the extraordinary LTI grant needs explicit approval from the Euronext Shareholders Meeting. And to conclude, in our view, the Remuneration Committee acted beyond its mandate This, we would like to reflect in our vote on this specific topic as well as in the discharge of the Supervisory Board.

Thank you. Let me direct the question to the Chair of the Remuneration Committee, Ms. Nathalie Rachou, please?

Right. Plenty of questions. Thank you. We've engaged already, and we agreed to disagree. So I'm going to repeat to you what we discussed when we engaged directly. And let me also say that throughout the process of the remuneration committee, are engaged with shareholders on all matters, but especially on this specific matter of the special grant. And I found that most of our shareholders, I mean, in fact, all of them were very supportive. And the reason why is very simple, it's called retention. We operate in a market, the market of financial services and also in the IT market as far as the CEO is concerned. These markets are very fluid, shall we call them, offers come and go. And quite frankly, even though both the CEO and the -- sorry, the CEO, let's be quite clear, and COO have both signed up for Stephane for another term and the COO for, I hope, a long period of time ahead of us. Well, they are in a market and market pressures exist. I'm not at liberty to comment about possible offers they might have received at any given point. But the Remuneration Committee and the Supervisory Board in its entirety are quite aware of those pressures and these possible offers. And thereby, retention is a key part of our mission. Even though Chief Executive have just signed for a new term, is not bound for those -- it's not bound to stay. It's not a commitment to stay. He can walk anytime he wants. Likewise, the COO and quite frankly, our responsibility as a Supervisory Board and our responsibility as a Remuneration Committee advising Supervisory Board is definitely to make sure that there is proper management and sustainable management for the company. And I consider that and my colleagues along with me that it is our key responsibility to address those worries. So retention is the order of the day and retention was really the reason behind the special grant. Because we engaged -- because I engaged so much with the shareholders, there were 2 things which came out loud and clear. The first one is that they were really concerned by the integration of Borsa Italiana because it was so difficult and intricate and challenging. So throughout my engagement with shareholders in 2023, but also in 2022, in fact, ever since we bought Borsa Italiana. Integration has been a major concern from all our shareholders. So they repeated that when we express some retention fees. And they said, well, as long as it refers to the integration of Borsa, we're happy with anything because we've got so much riding on this integration. It's a major risk for the company, and you need to mitigate that risk, you need to make sure that everything goes smoothly. So we thought it was a good thing to reemphasize the importance of delivering the integration of Borsa in the remuneration arrangements we could make. The second issue, which our shareholders have is, of course, that as much as possible, the Remuneration Committee and thereby, the Supervisory Board should align the outcome with their interest, i.e., LTI look to be the best instrument because there's a real -- I mean, there are real conditions linked to the LTI. They've been strengthened in the 2021 policy -- remuneration policy. So now we've got, I think, an efficient LTI policy, which is demanding enough upon management. So it was very clear from all these engagement with the shareholders that anything to do with retention was welcomed by them, providing it was aligned with their interest, i.e., under the form of LTI grants, and they wanted it to be linked to the integration of Borsa. And I repeat, yes, it is -- it was part of the STI criteria, but it was of such magnitude that we thought it deserved an extra -- an extra grant. And that was all for the purpose of retention. So that's it. So it is within the remit of the remuneration policy for the remuneration report to recommend and for the Supervisory Board to vote for exceptional grants, STI-LTI salary increase whatever. I think we've showed some restraint by giving only LTI grant, vesting under the same conditions as the regular grant. Whilst we could have done as happens -- as it's happening in the market currently with AFS increases, STI increases, increased multipliers, et cetera. Can I just give you the hint to have a look at [indiscernible] remuneration package as approved by the AGM of LSEG recently. I think we've shown considerable restraint by granting a 1-year AFS LTI grant to the CEO and COO.

Okay. May I raise 4 quick follow-up questions. First, you referred to that there might be, let's say, a lot of optionality in whether there were let's say, acute threats of 1 of them leaving. Can you make it more explicit. Were you informed that any of the 2 were...

I'm afraid I won't comment on that.

But how can we then assess whether retention was the real reason?

Well, you've got to believe me, if you don't. I'm sorry. I won't make any other comments.

Okay. But then I interpret this as a an argument, which is kind of camouflaging an extra remuneration because if there were an ultimate threat, you could say, while, there was an instance, 1 of the 2.

I won't comment.

Okay. The second is you now clearly stated the reason was retention how then can you put it under the umbrella that it would serve the long-term interest and sustainability of the company as a whole and ensure its viability is Euronext debt dependent on 1 or 2 individuals?

Well, I mean, let's be what candid. When you lose your CEO or your COO, you've got to go back to the market. You can have some internal resources. Yes, we did that when we replaced the COO. And I must say it's been a thorough success, well done, Manuel. But you don't always have the right resources at the right -- at the perfect timing. And so when you go and in the case of the CEO, you need a thorough process, a thorough selection process, which takes time. During this period -- well, even if you've got an interim candidate, the company is at risk, the company is exposed. Do you think that your Supervisory Board wants to experience that sort of pressure and that sort of tension and that sort of risk? Certainty not, certainly not. And so it's a question of risk management. That's our job, making sure that the company is not at risk and that its management is in a good position to exercise its mandate. And that we can sleep at night because we know that it's properly looked after. So I mean, we're paid just to make sure that those risks don't materialize. So it is definitely the long-term interest of the company and its sustainability.

Well, with all due respect, but that underestimates the role of the general meeting because exactly that is part of the remuneration policy as is which means that the long-term incentives can only fast after a period of time. So we are, and you refer to 1 benchmark, which is an outlier, but we follow all the general meeting. So we are that aware maybe as aware as you are, the continuity of the Board and especially the CEO, C)O positions is of the essence. But that is reflected in the remuneration policy, especially in the testing conditions. So we really don't see why an additional one-off is really necessary to put an extra...

We thought it was called retention. And that's it. That's the only reason. And we just confirmed that we stand by it.

Then a question, how can we circumvent that this is next year exactly the same discussion because if you had a document over, let's say, last year, you can use a document for every year. And then we have a new remuneration policy.

I mean you will have a remuneration policy, and you and I will engage on it. I don't think it will be revolutionary. And I think we'll probably stick to many principles of the current remuneration policy and we'll see. But this was a special grant. It's not supposed to be repeated if it became a regular occurrence. I think that we could be considering having it voted at the AGM.

Okay. And the last question, and that's more on the legal sanity. If you use the argument of the future and sustainability of the company, the risk of the company, of course, we can have an interpretation issue here. You think it is. I think it's not. Wouldn't it be better to just bring this forward to the general meeting? And if you can convince us that it would be good for the shareholders to allow an extra grant, of course, you can convince us and we can vote in favor. Why have you not opted for that solution? Because if that's acute for sustainability of Euronext, it should be our decision as well.

Well, I think it's within the law just to have the special ability to make exceptional remuneration exceptions. It's within Dutch law. So I don't see why we shouldn't use it.

Okay. I think you pushed the boundaries of the law and interpreted it as if it's within the law. I dare to say that I think it's beyond the boundaries. But anyway, we can't change it here. But as I already signaled, we will vote against and also in the discharge of the remuneration of all the remuneration companies and the Supervisory Board. This will be an element of our choice.

Are there any other questions regarding the remuneration report? I note that no further comments are made and no further questions are asked. voting item 1. Are there any shareholders who wish to vote against the proposal to adopt the 2023 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 both against or abstain from voting. If you are a shareholder who wishes to cast votes, both in favor and against and 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 will 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.

Good morning. My name is Chris Topple. I represent here Optiva, the company's registrar, representing Europlay, France, representing in this meeting, 86,281,613 shares. I informed the meeting that we've been in strategy to vote as follows: 46,409,445 votes against this item, 1,468,104 votes as abstention and 38,404,064 votes in favor of this item. Thank you.

Yes. We vote against as well. We think It's always [indiscernible] information how many votes we represent. So you know, 1,007 [indiscernible] we vote against.

Thank you. That is noted and taken into account by the result that I am about to read. If there are no further votes against no further abstentions. I assume that the remainder of the votes are in favor. I conclude that the proposal to adopt the 2023 remuneration report has not been adopted. We will proceed to the next item, Agenda Item 3D, voting item 2, proposal to adopt the 2023 financial statements. The second voting item in this meeting is the proposal to adopt the 2023 financial statements. Are there any shareholders who have questions about the proposal to adopt the 2023 financial statements? I note that 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 2023 financial statements? Are there any shareholders who wish to abstain from voting? I refer to the voting procedure 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: 58,800 votes against this item, 195,411 votes as abstentions 86, 270,302 in favor of this item. Thank you.

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 2023 financial statements has been adopted. We will proceed to the next item. Agenda Item 3E voting Item 3, proposal to adopt a dividend of EUR 2.48 per ordinary share. The third voting item in this meeting is the proposal to adopt a dividend of EUR 2.48 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 2.48 per ordinary share. Are there any shareholders who wish to abstain from voting?

I inform the meeting that we've been instructed to vote as follows. 3,895 votes against this item, 101 votes as abstention, 86,277,617 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 a dividend of EUR 2.48 per ordinary share has been adopted. We will proceed to the next item. Agenda Item 3F, voting item 4, proposal to discharge the members of the Managing Board in respect of their duties performed during the year 2023. The fourth voting item in this meeting is the proposal to discharge the members of the Managing Board in respect of their duties performed during the year 2023. Are there any shareholders who have comments or questions about, this item? I note that no comments are made and no questions are asked. 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 the year 2023? Are there any shareholders who wish to abstain from voting?

I inform the meeting that we've been instructed to vote as follows: 3,535,537 votes against this item; 313,714 votes as abstention, 82,432,362 votes in favor of this item. Thank you.

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 discharge the members of the Managing Board in respect of their duties performed during the year 2023 has been adopted. We will proceed to the next item. Agenda item 3g, voting item 5, proposal to discharge the members of the Supervisory Board in respect of their duties performed during the year 2023. 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 2023. 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 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 2023? Are there any shareholders who wish to abstain from voting? Your vote has been noted. The notary will take care of it.

I inform the meeting that we've been started to vote as follow: 6,917,784 votes against this item, 313,719 votes as abstention and 79,050,110 votes in favor of this item. Thank you.

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 discharge the members of the Supervisory Board in respect of their duties performed during the year 2023 has been adopted. We will proceed to the next item, Agenda Item 4, voting item 6, 7, 8 and 9, composition of the Supervisory Board. Further to the rotation schedule that has been adopted by the Supervisory Board and that has been published on the website of Euronext N.V. 2 members of the Supervisory Board, Mr. Manuel Ferreira Da Silva and Mr. Dick Sluimers, will retire after the AGM. I'm pleased here to announce that Mr. Sluimers is available for reappointment for a third term of 2 years. Mr. Ferreira Da Silva will leave the Supervisory Board. We thank him for his valuable contributions during his 3 terms on the Supervisory Board. In addition, Ms. Coppens and Ms. Chan have announced their retirement from the Supervisory Board. We'd regret to see them leave and express our gratitude for their valuable contributions as well. The Supervisory Board is pleased to announce that it has selected Ms. Fedra Ribeiro, Ms. Muriel De Lathouwer and as candidates to succeed Mr. Ferreira Da Silva and Ms. Coppens. Also, the reference shareholders have recommended Mr. Koen Van Loo as successor to Ms. Chan. The Supervisory Board has drawn up binding nominations for these appointments for a term of 4 years and for the reappointment for a term of 2 years. I refer to the explanatory notes to the agenda and its annex for information about the candidates. Please note that the appointment of the 3 new candidates is subject to regulatory approval, which has not yet been obtained. All candidates are present in this meeting. You already know our Vice Chairman, Ms. Sluimers, who is with me behind this table. I kindly invite Ms. Ribeiro, Mr. De Lathouwer and Mr. Van Loo to stand up and briefly introduce themselves to the shareholders, please.

Good morning. Thank you, Mr. Chairman. My name is Fedra Ribeiro, 51 years old and Portuguese. I am very proud, honored in taking over from Manuel. Thank you for the trust. I currently serve in Bosch as an Executive Vice President in their cross-domain computing solutions. Most of my career has been focused in technology-driven transformation. Besides Bosch, I served in the Renault, Raytheon, SPX and Volkswagen, I am very proud and honored to be with you today, and I would hand over to my colleague, Muriel to introduce herself.

Thank you, Fedra. Thank you, Mr. Piero Novelli, Chairman. Good morning. I'm extremely honored with this opportunity to join the Boards of Euronext. I'm currently independent Board members in several listed and privately-owned international company. And I'm also involved in the digital and [ digi tech ] start-up ecosystem in Belgium. Beforehand, I have the experience of CEO of a listed company, a technology company called EVS listed on Euronext and a global leader in live video production server. I've also gained experience at McKinsey. I spent 8 years at McKinsey and our Chief Marketing Officer of a mobile telecom operator. I'm extremely pleased to join this group and really looking forward to contribute to this noble purpose. Thank you very much.

Thank you, Muriel. Good morning, everybody, ladies and gentlemen, Chairman. My name is Koen Van Loo do. I'm 51 years old, also Belgium father of 2 kids, and I'm CEO of the Belgium sovereign wealth fund called SFPI. We are member of the reference shareholders, and I've been following Euronext, since 2014 in that capacity. So I'm hoping to be able to kick start, if you give me the honor of becoming Supervisory Board member. I think I bring to the table a lot of M&A experience and also an important and international network, and I'm looking forward to contribute to help create shareholder value for all Euronext shareholders in the future, if you grant me that opportunity. Thank you.

Thank you. Let us now proceed to voting on these appointments and reappointments. The sixth voting item is the proposal to reappoint Mr. Dick Sluimers as a member of the Supervisory Board. Are there any shareholders, who have comments or questions about this item? I note that no comments are made and no questions are asked. I suggest to vote on the agenda item to reappoint Mr. Sluimers to the Supervisory Board. Voting item 6. Are there any shareholders, who wish to go against the reappointment of Mr. Sluimers? Are there any shareholders who want to abstain from voting?

I inform the meeting that we are instructed to vote as follows: 3,566,214 votes against this item, 5,061 votes as abstention, 82, 710,338 votes in favor of this item. Thank you.

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 resolution to reappoint Mr. Sluimers for a term of 2 years has been adopted. The seventh voting item is the proposal to appoint Ms. Ribeiro as a member of the Supervisory Board, subject to regulatory approval. Are there any shareholders who have comments or questions about this item? I note that no comments are made and no questions are asked. I suggest to vote on the agenda item to appoint Mr. Ribeiro to the Supervisory Board, voting Item 7. Are there any shareholders who wish to vote against the appointment of Mr. Ribeiro? Are there any shareholders, who want to abstain from voting?