Hello, and welcome to the Euronext Q1 2024 results call. My name is Laura, and I will be your coordinator for today's event. Please note this call is being recorded, and for the duration of the call, your lines will be on listen-only mode. However, you will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your question. If you require assistance at any point, please press star zero and you will be connected to an operator. Today, we have Stéphane Boujnah, CEO and Chairman of the Managing Board of Euronext, joined by Giorgio Modica, CFO, as our presenters. I will now hand you over to your host, Stéphane Boujnah, to begin today's conference. Thank you.
Good morning, everyone, and thank you for joining us this morning for the Euronext first quarter 2024 results conference call and webcast. I am Stéphane Boujnah, CEO and Chairman of the Managing Board of Euronext, and I will start with the highlights of this quarter. Giorgio Modica, Euronext CFO, will then develop the main business and financial highlights of the first quarter of 2024. As an introduction, I would like to highlight three main points. First, Euronext has demonstrated its capabilities to deliver strong growth, thanks to its diversified business model. We have delivered +8% revenue growth in Q1 2024, bringing revenue and income to a record level of EUR 401.9 million. This very good performance was driven by solid growth in non-volume related businesses.
In record performances in fixed income, record performance in power trading, as well as the benefits of our successful expansion of Euronext Clearing to Euronext European cash market in November 2023. Second, thanks to our continued cost control and some positive one-offs, we reduced significantly our underlying expenses by -2% year-on-year to EUR 150.7 million, despite inflation that affected all of us, and we reached, therefore, an Adjusted EBITDA margin of 62.5%. Third, we are definitely on track to complete the integration of the Borsa Italiana Group. We completed the migration of Italian derivatives to Euronext proprietary trading platform, Optiq, in March.
The last step of the integration will be delivered in Q3 2024, in a few weeks' times, when we migrate all Euronext financial derivatives and commodities listed on our European markets to Euronext Clearing, to complete our presence on the entire trading value chain. Thanks to our continued progress with the delivery of the Borsa Italiana Group integration, we delivered EUR 79 million of cumulative run rate synergies at the end of 2024. So we are perfectly on track to achieve our Growth for Impact 2024 target of EUR 150 million of annual run rate synergies by the end of this year, just three years after this transformational acquisition was completed. Since the beginning of the year, we have continued to innovate for the benefit of the attractiveness of European capital markets and for the benefit of our clients.
Euronext successfully launched Dark Midpoint and Sweep functionalities in Q1 2024, hosted in our core data center in Bergamo. These new functionalities are critical in continuing to provide the highest liquidity to all our trading members. We have rolled out the harmonized corporate action services across CSDs in order to tackle post-trade fragmentation in Europe. Lastly, we have strengthened and diversified our data index franchise with the announced acquisition of Global Rate Set Systems, GRSS, a leading and highly respected provider of services to benchmark administrators. GRSS is a mission-critical service provider to the benchmark administrators that produce three of Europe's critical interest rate benchmarks, EURIBOR, STIBOR, and NIBOR. Together with the GRSS teams, we aim to reinforce significantly the positioning of GRSS in order to become the go-to provider in the contributed data and indices space, leveraging on Euronext's global leadership and recognition.
Let me give you a quick overview of the performance of the first quarter of 2024 on slide 4. Euronext reported a very strong first quarter of 2024, posting revenue growth of +8% year-on-year, up to EUR 401.9 million. The quarter was marked by strong dynamism in post-trade and non-volume rate driven activities, together with the record performance of fixed income and power trading. First, post-trade revenue saw double-digit growth. Euronext Clearing's performance was driven by the first full quarter of contribution from its expansion to European cash instruments, as well as very dynamic commodities clearing activity. Euronext Securities posted a strong +6% increase in revenue this quarter, thanks to the growth in issuance and custody services. Second, our trading revenues posted strong growth, supported by record quarter for fixed income and power trading.
This is the proof of the group's successful diversification. Despite lower equity and derivative volumes, our total trading revenues grew by over 7%. Third, non-volume related revenue posted a strong performance overall, notably in listing and Advanced Data Services . We remain, this quarter again, the leading listing venue in Europe. We also observed in the second quarter so far, a very encouraging dynamic of our listing activity, with two large IPOs in April, Planisware and CVC Capital. This translated into non-volume related revenue, accounting for 58% of the total Q1 revenue, and covering 155% of underlying operating expenses, excluding D&A. We continued our trademark discipline approach to cost control.
Combined with a positive one-off accruals release, Q1 2024 underlying operational expenses, excluding D&A, decreased slightly to EUR 150.7 million, down -2% compared to our cost base of the first quarter 2023, and all that despite inflationary pressure. Overall, we reported a strong growth in adjusted EBITDA of +15% to EUR 251.3 million, and an adjusted EBITDA margin that increased by 3.8 points to 62.5%. This strong performance, combined with a continued positive interest rate environment for cash in the bank, led to a +15% increase in adjusted EPS at EUR 1.58 per share. And it also led to an adjusted net income of EUR 164.2 million.
On a reported basis, EPS for this first quarter also benefited from the positive comparison base related to the provision of the EUR 36 million termination fee of the clearing agreement that we paid in Q1 2023. Consequently, reported EPS increased by +49.1% to EUR 1.35. Lastly, we continued to deleverage massively, reaching 1.6 times net debt to last twelve months adjusted EBITDA at the end of March 2024. This compares to 3.2 times at the completion of the Borsa Italiana Group acquisition in April 2021. Our ongoing delivery impact has been praised by S&P, who upgraded us to BBB+ positive outlook in April.
As I mentioned earlier, we are now entering the final phase of our 2024 strategic plan and the Borsa Italiana Group integration, with only one step ahead of us to complete this integration journey. In March 2024, we successfully migrated Italian derivatives trading operations to Optiq. This migration was the last in the ambitious integration plan of Italian cash and derivatives markets and to the Euronext single trading platform. And it was completed less than three years after the acquisition of the Borsa Italiana Group, completed in April 2021. This success contributed to the synergies delivered this quarter, and we reached EUR 79 million of cumulative run rate EBITDA synergies at the end of Q1 2024. You'll have understood that we are well 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 and commodity derivatives listed on all Euronext markets in the third quarter of 2024 will be the final step to achieve the targeted delivery of EUR 115 million of cumulative EBITDA synergies at the end of 2024. Furthermore, the expansion of our clearing house will unlock a new set of strategic organic growth opportunities for us, which I'm looking forward to share with you on our Capital Markets Day on the 8th of November, 2024 in Paris. I now give the floor to Giorgio for the review of our first quarter, 2024.
Thank you, Stéphane, and good morning, everyone. Let us now have a look at the strong performance of this first quarter of 2024. I'm now on slide 7. As already mentioned by Stéphane, total revenue this quarter reached EUR 401.9 million, up 8% compared to last year, and 8.5% at constant currency. This quarter, there is no change in scope impact, and the full performance is organic. Non-volume related share of revenue remains high at 58%, highlighting the success of our diversification, and despite the record quarter for some of our trading businesses, like fixed income and power trading. Our diversified businesses delivered strong growth in this first part of the year with a record top line. Let me deep dive into the drivers of this excellent performance, starting with listing on slide 8.
Listing revenue was EUR 57.7 million, up 5.5%, driven by the increased volume of equity and that activity versus last year, and the good performance of Euronext Corporate Services. Euronext confirmed its leadership in equity listing in Europe and that listing worldwide. On the equity side, in Q1, 2024, Euronext welcomed 10 listings. Furthermore, we observe an encouraging dynamic in this first part of the second quarter with two large IPO in April, Planisware and CVC Capital. On the debt side, we reached, for the first time, 57,000 bonds listed on our markets, while we also strengthen our leader-leading position on ESG bond listing.
Euronext Corporate Services continued to deliver a solid performance, with revenue growing to EUR 12 million in this Q1 2024, up 12.5% compared to the first quarter of 2023, resulting from the strong performance of the SaaS offering. Slide 9 illustrates how data and Investor Services activity continued to drive growth this quarter. Advanced Data Services reached EUR 59.4 million revenue, up 5.5%, driven by the increased demand for non-professional usage and solid demand for fixed income and power trading data. Investor Services reported EUR 3.1 million revenue in the first quarter of 2024, representing a 17.4% increase compared to the first quarter of 2023, resulting from a continued commercial expansion, cementing the franchise among the largest global investment managers.
On the other hand, Technology Solutions reported EUR 26.7 million of revenues, down 3.3%, due to the reduction of logical access revenue, following the completion of the migration of Borsa Italiana cash and derivative market to Optiq. In other words, our client benefited from the savings of connecting to only one system. Moving to trading on slide 10, Euronext trading revenues at EUR 138.4 million, up 7.4% from the EUR 128.9 million in the first quarter of 2023. Not only shows the benefit of the diversification of Euronext trading activity, but it also showed the resilience of our cash trading model in a low volume environment.
Cash trading revenue was EUR 70.6 million, down 1.6% versus the first quarter of 2023. It reflects lower trading volumes by 9.2%, primarily offset by improved average fees. Cash revenue capture average 0.54 basis point, despite the average order size remain very high. It demonstrate the benefit of the new fee scheme implemented in Italy, following the migration of Borsa Italiana cash equity markets to Optiq. Cash equity market share average a healthy 64.6%. Derivative trading decreased by 10.9% to EUR 13.4 million in the first quarter of 2024, due to lower financial derivative volumes, with ADV down 12.6%, partially offset by stronger performance of commodity derivatives, with volume up 34.3% versus last year.
Average revenue capture on derivatives trading reached 0.33 EUR per lot. Lastly, FX trading grew 12.7% to EUR 7.1 million of revenues in the first quarter of 2024, up 12.7%, mostly supported by growing volume, slightly offset by a negative volume mix impact. Continuing with trading on slide 11. Fixed income trading revenue grew 34.5% and reached another record quarter at EUR 35.2 million, reflecting strong performance of MTS Cash, MTS Repo, and the increased traction of the Euronext fixed income retail franchise. Our fixed income franchise continued to be supported by an economic environment, favoring many money markets, sustained sovereign issuance activity and supportive volatility.
For the first quarter of 2024, MTS Cash recorded 34.7 billion euros of ADV and MTS Repo reached EUR 492 billion of term adjusted ADV. MTS EU continued to post the encouraging results. Power trading revenue grew to EUR 12.2 million in the first quarter of 2024, up 23.7% compared to the first quarter of 2023. This record performance was driven by another all-time high intraday volume and a solid year-on-year day ahead trading activity. I conclude this business review on slide 12.
Clearing revenue was up 23.1% to EUR 37 million this quarter, reflecting the increased equity clearing volumes following the expansion of Euronext Clearing to the cash trading market in Belgium, France, Ireland, and the Netherlands and Portugal in the fourth quarter of 2023. High clearing revenues from the dynamic commodities activity. Non-volume related clearing revenue accounted for EUR 11.1 million, and the total clearing revenues in Q1 2024 reached, as I said, EUR 37 million. Net Treasury Income amounted to EUR 11.7 million in the first quarter of 2024, representing a 57% increase from Q1 2023. As a reminder, Q1 2023 NTI was still impacted by the run-off of the Euronext Clearing investment portfolio.
Lastly, revenue from custody and settlement and other posted activity reached EUR 67.8 million this quarter. This is a 6% increase, reflecting a dynamic issuance activity, the good performance of new services, and higher asset under custody. On a like-for-like basis, custody, settlement, and other posted revenue was up 7.1% compared to the Q1 2023. Moving on with the financial review of the quarter, I will start now with the EBITDA bridge on slide 14. Euronext adjusted EBITDA for the quarter was up 15% to EUR 251.3 million. This translated into an EBITDA adjusted margin of 62.5%. This quarter up 3.8 points compared to the first quarter of 2023.
Non-underlying costs for the quarter were EUR 8.7 million, primarily in relation to the ongoing work related to the clearing expansion and Optiq migration. As a reminder, in the first quarter of 2023, we provisioned 36 million fee for the termination of the clearing agreement with LCH SA, which has been paid this quarter in Q1 2024. The underlying operational expenses, excluding D&A, decreased 2%, reflecting continued cost discipline in an inflationary environment, and the release of some cost and provision totaling around EUR 3.5 million. As you can imagine, it's too early now to discuss about changing the cost guidance for 2024. That remains, as announced, with the results of 2023 at EUR 625 million.
Moving to net income on slide 15. Adjusted net income this quarter is strongly up, at EUR 164.2 million, which represent an increase of 11.7% compared to Q1 2023. So as you can see, I will not comment the increase of the net financing income, as this is obvious, reflecting an increased yield on our cash balance. You see as well that we have a decrease from equity investment, and this is mainly linked to the fact that we will not receive the one-off dividend from Sicovam we received last year. We will receive it in Q4 this year.
And, we don't benefit anymore from the results of associate linked to LCH SA that was disposed last year. Lastly, net income tax for the first quarter of 2024 was EUR 54.7 million. This translated to an effective tax rate of 26.9% for the quarter. Minority interest were, as well, higher due to the very good performance of Nord Pool and MTS. As a result, reported net income increased 44.8% to EUR 139.7 million. And adjusted EPS basics was up 15% in the first quarter of 2024, at EUR 1.58 per share. To conclude with the cash flow generation and leverage, I'm now on slide 16.
As you can see, our balance sheet position is very solid, as well as cash flow generation. S&P recognized our consistent leverage process and upgraded Euronext to BBB+, positive outlook in April 2024. In Q1 2024, Euronext reported a net cash flow from operating activities of EUR 184.6 million, compared to EUR 318.2 million in the first quarter of 2023. The latter reflected the strong positive movement in net working capital related to Nord Pool and the Euronext Clearing CCP activity.
Excluding the impact on working capital from Euronext Clearing and Nord Pool CCP activities, net cash flow from operation activity accounted for 68.6% of EBITDA in the first quarter of 2024, or EUR 184.6 million. The reduction versus Q1 2023 is explained by the payment of the EUR 36 million termination fee to LCH SA. Net debt to adjusted EBITDA was at 1.6 times at the end of the quarter, and 1.7 times on the reported EBITDA basis. And with this, I would like to give back the floor to Stéphane.
Thank you, Giorgio. Q1 2024 clearly demonstrated that the benefits of our diversification strategy are coming through, and they translate into high single-digit growth, boosted by non-volume related and diversified trading activities. Now that the integration phase is coming to an end, our efforts are focused on innovation for the benefit of the attractiveness of Euronext and European capital markets. We maintain our trademark cost discipline in an inflationary environment, and we continue to deliver on the key projects of the Borsa Italiana Group integration, to enable us to complete the value chain and to be on track to achieve our 2024 targets on synergies. Meanwhile, we are advancing, and that's probably the most important dimension of our agenda for the next few months.
We're advancing with the exploration of strategic opportunities, which I'm looking forward to share with you during our Investor Day on the eighth of November, twenty twenty-four in Paris. Thank you for your attention. We are now ready to take your questions together with Giorgio, Anthony Attia, the Global Head of Derivatives and Post-Trade, and Nicolas Rivard, Head of Cash Equity and Data Services, and of course, our IR team with me.
Thank you. Ladies and gentlemen, as a reminder, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We'll now take our first question from Bruce Hamilton of Morgan Stanley. Your line is open. Please go ahead.
Hi. Thank you for taking my questions. Congratulations on the quarter. On the synergy delivery, obviously, as you say, well on track. I make it that the. I think the cost or the payment to LCH is about EUR 35 million, which is basically, give or take, the gap between the EUR 79 million and the EUR 115 million. So should we assume that really there isn't much revenue synergy for clearing derivatives baked into that run rate number and the residual is all costs, or am I thinking about that incorrectly? And then secondly, on the cash trading business, I see that's a, you know, pretty good print, given that ADV was down 10% in Q1, and Q2 so far is running positive, which is also helpful.
On the average yield, though, it sounds as though 0.54 basis points is despite larger order sizes. So in a normalized environment, should we be thinking a sort of cash yield well above the sort of 0.52 minimum that you've talked about in the past? Thank you.
So Giorgio will answer your question on the synergies and Nicolas Rivard will take your question on the ADV.
So, I mean, when it comes to the synergies, as you pointed out, and you are correct, we will reach EUR 35 million run rate savings for the termination of derivative clearing arrangement of LCH SA, and it is very tempting to do the EUR 79 million plus the EUR 35 million. Reality is that, there are a number of plus and minuses that you would need to count to get to the actual number of synergies. And still, as you can imagine, we aim to reach and exceed the objective. So, having said that, it is difficult now to comment on whether this is the only element.
Just to give you one element, at the moment, as you can understand, we have some double run costs for our clearing activity, that after the termination will move from non-underlying to underlying, and so this is going to be a reduction. So we are very confident to make the EUR 150 million. On the other side, the EUR 35 million is not the only element that will play in the bridge.
And thank you for your question on the cash trading and mathematically your reasoning is correct. I just want to point out some important elements. In Q1, at the end of Q1 2023, as mentioned by Giorgio, and we made it on this call, we did the migration of Borsa Italiana to Optiq. And in this situation, we adapted the fee scheme of Borsa Italiana to the Euronext fee scheme, and we optimized our revenue capture. So the yield difference between Q1 2024 and Q1 2023 is to a large extent, not only, but to a large extent explained by the migration of Borsa Italiana to Optiq.
Now, when it comes to the yield, there are a number of different elements in the yield. On the positive side, if I may say, for the yield, but not for the volume, when the volume are low, the yield is higher. So you should not necessarily consider that the yield is in a higher volume environment going to remain at this level or to go. Secondly, as you mentioned, the order size is high, and it remains very high, and it's very difficult to predict where it's going to go. And in this environment, the yield is negatively impacted.
However, we did in April this year a change in the fee scheme of our main fee scheme for large German brokers, whereby we are less dependent to order size than we were before. So it's obviously a positive in the other side are continuing to grow, but also if the order size is going down, then it will, it will be less impactful for, for Euronext. And lastly, there is also another dynamic, is the relative market share of the different participants, which is, fluctuating from one quarter to another. To bottom line, in conclusion, I think we should not, over-engineer the change of, of years moving forward, depending on the, on the average executed order size.
Got it. Very helpful. Thank you.
Thank you, and we'll now move on to our next question from Arnaud Giblat of BNP Paribas Exane. Your line is open. Please go ahead.
Yeah, good morning. I've got three questions, please. Clearly, you had quite some strength at MTS. I'm just wondering how much of the volume surge is linked to the increase in BTP issuance, specifically there, and do you... If maybe you could give a bit of color whether the activity is mostly primary or secondary?
Second, I'm wondering on the deleveraging. You've done some progress there, 1.6 times net debt to EBITDA. How are you thinking about capital management? Is a share buyback eventually or other form of capital return? Could that come back on the table? And my third question is on custody and settlement. I'm just wondering if you could give us a bit more color in terms of what the split in revenues looks like between custody and settlement. Is it a typical three quarters custody, one quarter settlement? Thank you.
Okay. So I'll take your question on capital allocation. Giorgio will provide you some flavor on the dynamic on the MTS business, and particularly in relation to BTP issuance. And Anthony Attia will cover your question on the structure of custody and settlements dynamics. Capital allocation is the output of a decision of a series of decisions related to growth and profitability. And what we are going to do is to build a strategic plan for the three years to come to decide within our governance the financial requirements and the allocation of resources needed to fund the enablers of growth and performance for the group.
We will decide accordingly, as a consequence, what's the best way to allocate capital. By default, in the absence of any clear new decisions, we intend to continue by default, as of today, with the current dividend policy. And when it comes to share buyback, again, it's not appropriate to make any decision share buyback now, as we have not finalized what will be our investment needs for the years to come. So more on this topic, on our Investor Day on the eighth of November, 2024. Over to you, Giorgio.
Yeah. When it comes to your question on MTS, so the first element, Italian government bonds remain a large portion of the volume which are traded on MTS, even though other sovereigns are traded every day on MTS, but the lion's share remains Italian government bonds. The relationship between primary issuance and secondary activity is very linked. New bonds tend to be traded more than old bonds to a certain extent. So, answering your question, the revenues are mostly linked to the secondary activity. However, the positive dynamic of issuance triggers a positive impact on the secondary market.
However, the market remains very very dynamic, because as the volume grow, then the spread between bid and ask gets tighter and tighter, and the cost of getting in and out lowers, and this triggers further activity. So, this is the dynamic we're seeing at the moment. So, good primary issuance is a driver, but it is not the main driver of this performance.
Anthony?
Thank you, Giorgio. Thank you, Stéphane. On the custody and settlement revenue numbers, so in Q1, as you know, we were up 8.7% on the assets under custody, which is a good progression. And the total number was EUR 67.8 million revenues. We don't provide the exact breakdown following the different activities between custody and settlement, but I can give you some indications. So in the 67.8 million euros of revenues, we have around EUR 60 million that are coming from the core CSD activity, in opposition to the added value services.
You can split the evolution between around 50% on the assets under custody, one quarter on the issuance and one quarter on the settlement. Thank you.
That's helpful. Thank you very much.
Thank you, and we'll now take our next question from Hubert Lam of Bank of America. Your line is open. Please go ahead.
Hi, good morning. Thank you for taking my questions. I've got three of them. Firstly, on your deal for GRSS, can you talk more—a bit more about the deal, how many revenues it will add, and how you expect to grow the business further? The second question is on costs. I know Giorgio is not changing the year-end guidance as of now, but obviously in Q1, you're tracking well below your target. Can you just let us know if there's any investment spends that you have for the rest of the year, or seasonality that can drive the costs closer to your target?
Lastly, you've had strong growth in both the Advanced Data Services and custody, which you mentioned. Can you talk about the sustainability and the strength of the strength in both of these segments going forward? Thank you.
Okay. So I'll let Giorgio cover your question on cost and the sustainability of growth on the two growing segments you have mentioned. And Anthony, who runs our derivatives and post-trade and indices business, will share with you the rationale and the prospect of the integration of GRSS, although we do not disclose numbers at this stage.
Thank you, Stéphane. So as Stéphane explained earlier, GRSS is a key provider of benchmark indices across the world, including the EURIBOR. So for us, it's a strategic acquisition that comes to reinforce and complement our existing index franchise. Our index franchise, as you know, was built on historical indices, such as the CAC 40 in France or the AEX in the Netherlands. It's been growing over the past few years with bespoke white labeling indices that are used in particular by buy side and sell side on ESG topics. So we have developed that very strongly.
GRSS is coming as a third pillar to provide us with contributed indices capabilities. So that's a key cornerstone of the development of our index franchise.
Yeah. So, when it comes to your question on cost, I'm trying to give you some heads-up to help you with the bridge. So the underlying cost for the quarter is around EUR 151 million. Then, as I said, with some releases of around EUR 3.5 million, then another element that you should consider as well, is that the annual review process in Euronext takes place in March, which means that in the first quarter, you don't have the impact of salary increases that will touch more the other quarters. And with that, you might add another couple of million EUR.
And so, you see that, with all of these adjustments, you get closer to the run rate, which is implied in our target. Then clearly, and you would be correct, there are a number of savings that still we need to deliver, especially the termination of the LCH contract, EUR 35 million run rate, EUR 17.5 million PNL. But to offset that, there are going to be a number of items. First, we highlighted last year that our willingness to invest EUR 10 million in organic growth. And then my final remark is that, in the non-underlying costs, there are some double run costs. Let me explain.
For example, at the moment, we're running two different cost base, one for the LCH contract and another one to run Euronext Clearing. Progressively, when we will terminate the LCH contract, those non-underlying contract costs will become underlying, and these will contribute as well to an increase of the underlying cost. So what I'm trying to say, you can see that with the adjustment I mentioned, we would be around EUR 156-157, and the EUR 17 million of PNL saving on the LCH contract will be largely offset by investment of growth and movement of cost from non-underlying to underlying. So this is a bit the bridge to get to the EUR 625. Absolutely.
And then, when it comes to the sustainability of growth in the growth of market data, as we have always said, there is an element of yearly price adjustment, and this element is going to remain for the rest of the year. Then we will need to see the dynamic of, as usual, of the growth of clients and demand for Advanced Data Services. But again, the key driver for the year is going to be mainly the price adjustment.
When it comes to the sustainability of custody and settlement revenues, here we see, we've seen a positive dynamic so far in the asset under custody, so we remain positive in this respect. Then clearly, what we have posted in the first quarter is a very strong growth rate, but again, we remain positive that the growth is going to be such to allow us to deliver the ambition of 2024.
Great. Thank you very much.
Thank you. And we'll now take our next question from Ian White of Autonomous Research. Your line is open. Please go ahead.
Hi there. Thanks for taking my questions. Actually two follow-ups in similar areas. Actually just on GRSS, just to be sort of clear, I guess I'm trying to understand sort of why it is useful for you to enter the value chain for sort of benchmark administration, for benchmarks that I believe are all provided by your competitors, things like EURIBOR and STIBOR. So can you just help us understand a little bit more about the rationale there?
Do you intend to compete, for example, in providing interest rate benchmarks or fixed income indices, or am I sort of misunderstanding the rationale for the deal? And just secondly, on Advanced Data Services, can you just call out how much of the, growth year-over-year was driven by, sort of growth that might be linked to activity? The release talks about non-professional usage and, and, you know, fixed income and power data versus sort of recurring demand or the price effect that you just mentioned, please. Those are my two questions. Thank you.
So Anthony is going to provide complementary comments on GRSS business model and fit with the Euronext strategy. And Nicolas Rivard is going to answer your questions on the ADS business.
Thank you, Stefan. Thank you for your question. Look, GRSS is to be seen as a building block and a capability acquisition to complement our existing index franchise. There are several angles to the answer to your question, but looking first at the value chain, as you know, indices are part of an ecosystem linking with ETF, structured product, listed derivatives. And in this value chain is being unlocked also by our CCP expansion.
And so we will discuss about how we leverage on this new capabilities and this value chain in the presentation of the new strategic plan in November. But it gives you a flavor of the exploration that we are doing right now, as Stefan mentioned earlier. The other angle is to look at the index business from a critical mass perspective, and as I explained, it's acquiring contributed indices capabilities will help us scaling up our index franchise in the future.
Thank you, Anthony, and thank you for your question on Advanced Data Services. We don't provide quantitative split of the revenue in drivers in the different sub-businesses or depending on the growth drivers. But let me give you a bit of a qualitative comment. The advanced data service business is composed of real-time market data for all asset classes traded on Euronext, being equity, equity derivatives, fixed income, MTS, power derivatives. And this is by far the largest contributor to ADS top line. And on top of this business line, we have a non-real-time market data revenue, which are composed of a number of analytic products, one product, but also indices as well.
The dynamic on the real-time market data is the following: We have, first, as mentioned by Giorgio, driver number one is the change of prices at the beginning of the year. This is a classical yearly review linked to inflation, mainly. And the second element is the positive development on volume for retail investor. We are very proud in Q1 2024 to have more than 4.3 million retail investors using Euronext data to trade on Euronext market, which is a record high. And obviously, the good dynamic on power derivative trading and MTS trading is the positive element, which a positive driver for real-time market data on those asset classes.
On the non-real-time and quantitative project, we have good development. We continue to have a good pipeline and good traction of our new product. We see that it's going to continue moving forward. But again, this is a level two, considering the size of the real-time market data business. Thank you.
Got it. Thanks so much.
Thank you. We will now take our next question from Pierre Chédeville of CIC. Your line is open. Please go ahead.
Yes, thank you. Good morning as well. Two questions on my side. First one, back on the margins and this, it's good momentum on margin. You mentioned some positive one-off. Could you be a bit more specific on that front? And, you know, what was the size of those one-off, and what was the drivers of those positive one-off? And the second question is, I understand, I mean, you, you've launched commercially, you know, platforms of dark pool recently. I was wondering if you can share to us what impact you will estimate, especially on cash trading. And, do you have any target you can share in terms of where you see market share, for instance, for example, for cash trading to evolve for you?
I mean, I understand it's currently at 64.6% in Q1. How do you see that evolving over time? Thank you.
Giorgio will take your question on margins and one-off releases on affecting our cost base. And, and Nicolas Rivard will comment on the dynamic of the dark pool project, which is still at an early stage.
Yeah, absolutely. When it comes to the positive one-off, as I said, the euro amount is around EUR 3.5 million, and this is largely related to the release of a number of small provisions, and accrual.
I mean, I would just mention too, but it's really the sum of many small items. We have some releases of bad debt provision and some releases of bonus accruals and many others. The sum of these releases is around EUR 3.5 million.
Thank you, Giorgio, and thank you for your question. You, you're right on, on April the eighth, we have launched our dark offering on Euronext Optiq, on Euronext data center in Bergamo, for the client to benefit from the real midpoint price, delivered by Optiq, by our trading platform. The launch is still early, is obviously early stage, still recent. We are very happy to have a very strong commitment from client to join the platform. So we have a good number of clients already live, but more importantly, we have a very important number of clients who are getting ready, in the test environment, in the user test environment, to join the production.
What also is important is we have a good mix of large brokers, a good mix of local brokers, and a good mix of service providers who are very important because they are the technology providers for local brokers to join this platform. So we are very happy with the pipeline of clients, and in the next couple of months, we should see a good lineup of clients joining the production. Now to your question, just to give you a few elements. In Q1, we see that dark is now a well-established feature of the European market structure.
In Q1 2024, it represented around 9% with up and down of volume on Euronext traded stocks. And this is what we are targeting, right? So we are not going to provide target, but this is the market we are looking for. It's going to be, as you mentioned, a positive on the market share, because the official market share we provide to you include dark in the calculation, which we were absent from before April the eighth. That's the second point.
And the third point is that, thanks to the integration of this dark offering in our Optiq platform, we have an interesting functionality which allow brokers to switch from the dark to the lit, so they can first interact with the dark and then move to the lit. And we were absent from this, again, from this offering, and this should have a positive effect on our market share.
All right. Thank you. Thank you.
Thank you. And we'll now move on to our next question from Tom Mills of Jefferies. Your line is open. Please go ahead.
Hey, good morning, thanks for taking my question. I just had one on a recent announcement by Cboe, confirming that they'll launch a European listings venue by year-end. Appreciate there's not a huge amount of detail on that yet, but it seems like they would allow shares to be traded through any of its markets, including the U.S., potentially adding to liquidity. I guess, just given all the noise that's going on around European-listed companies at the moment and the attractions that they see in the U.S. market, how compelling a competitor do you think that could be? I guess it's easy to be kind of dismissive around rival listings venues, but it does seem like a more compelling offering than perhaps we've seen in the past. And, you know, how would you think about responding to that? Thanks very much.
It's very difficult for me to comment on competitors' initiative at this level of headline announcement. What I can tell you is that we welcome competition. We have been developing the company in a very competitive environment. There was a time when London was a very fierce competitor for international listings. Things have evolved, and over the recent years, the dynamic has changed massively because liquidity goes to liquidity. What has happened with the consolidation of Euronext is that we now have a liquidity pool, which is by far the most the deepest in Europe, with about EUR 10 billion average daily volumes, which is approximately twice the size of the volumes traded on the equity segment in London.
Aggregate market capitalizations of companies listed on Euronext market on the single liquidity pool, the single order book, the single technology platform, amounting to approximately EUR 7 trillion. Which is, again, more than twice the size of the aggregate market capitalizations of companies listed in London. And we have 25% of the shares traded on Euronext, in Europe, that are traded on Euronext. And we had last year close to 50% of the IPOs in Europe, and definitely more than 90% of the international listings from the rest of Europe or the rest of the world coming to Euronext.
So we are in a totally different situation than the one we were in 5 or 10 years ago, and we are in a totally different situation from the one of our competitors, just because in one asset class, which is equity, which is not the focus of many of our competitors. We have been able, over the past 10 years, to consolidate the market and to make it relevant, attractive, and deep. Now, one of the features of this market is a proper single order book, single technology platform, single liquidity pool. And we do know the difference between secondary trading in geography and another one, and one single order book, which is what we have.
If some of our competitors claim that they can offer liquidity, then transatlantic liquidity, I must tell you that when Euronext was part of the New York Stock Exchange, it was part of the dream, and it never existed for real. So I want to be clear, we welcome competition, but the full ecosystem and the close relationship between the research, equity research community, the local brokers, the large global players is, for the moment, creating an environment that we see more favorable than the other way around to the growth of our listing business. And, you know, if CVC a few weeks ago decided to list on Euronext, that's probably because they had made their numbers and their strategic assessment of the alternatives.
So we are very confident about the growth prospects of our listing business, and we welcome competition wherever it comes from.
Thank you. Thank you.
Thank you, and we'll now take our next question from Iulian Dobrovolschi of ABN AMRO. Your line is open, please go ahead.
Hello, good morning, gentlemen. Thanks for taking my question. I have just a follow-up, frankly, and most of the other ones were already explained in details. But just a follow-up on the fixed income business. I understand this is somewhat linked to the interest rate environment, which is rather elevated at this point in time. But can you please give us a sense of how you expect this business to develop over the next quarters in 2024? Just trying to understand, for example, have you- have we reached a peak in revenue generation in Q1, or is there more upside left to be expected in the next quarters?
So, I mean, it's a tough question, your question. So, what I can say is that clearly we were already posting a good performance in the fourth quarter last year. This performance is increasing, and as always, giving short-term targets for volumes is always complicated. What I can share with you is that the team feels that unless there are significant changes in the environment, the type of levels of volumes that we have seen in the last month can be repeated in the following quarter. Then, being more precise than that would be difficult or impossible.
Maybe one ancillary point, and I cannot provide you numbers, but you can get to your own conclusions. MTS was selected as the electronic platform for the secondary trading of the NextGenerationEU bonds. That will represent, at the peak, a total volume of EUR 750 billion of issuance. Most of it has already been issued by the EU, and we are seeing good traction with the platform. I mean, liquidity on these instruments is moving to MTS, and over time, the monetization of these volumes is going to start in the course of 2024.
So I think today, when you look at the assets traded on MTS, you have first Italian govies, then Spanish govies, then NextGenerationEU instruments. So that's a new area of growth for the platform.
Thank you very much.
Thank you. We'll now take our last question from Mike Werner of UBS. Your line is open, please go ahead.
Thank you so much. Two questions for me, please. One, I believe you mentioned this previously, but can you confirm, with regards to the timing of the internalization of your derivatives clearing, and ultimately when you will stop allocating costs to LCH SA on this, when that will happen in Q3? I believe it's at the beginning of Q3, but, you know, from a modeling perspective, is it safe to assume it's done in the very early portion of Q3? And then second, I think Q1 is the first full quarter where you've been clearing the cash equities for your business.
And I was just wondering if we can get a sense of what the market share has been, i.e., how much of the total volume executed on your markets have been cleared through your Euronext Clearing. And maybe how that progressed from when this was first introduced in November last year to today. Thank you.
So when it, I mean, two great questions. I will do my best. So when it comes to the timing of the migration and therefore stopping paying LCH SA, the best I can tell you is that the contract, the notice period of 18 months, and we have served notice at the beginning of January last year. So this makes, I mean, you can do your own computation, but the timing, the official timing remains Q3. Then, when it comes to the market share, I cannot comment further. What I can tell you is that we feel that the full market share that was LCH SA, now it's fully transferred to us without leaks.
Thank you. That's helpful.
Thank you. There are no further questions in queue. I will now hand it back to Stéphane for closing remarks.
Thank you very much for your time, and, as always, our CFO, Giorgio Modica, our head of Investor Relations, and the full team, Aurélie Cohen, and all the teams are available to answer your follow-up questions. Have a good day.
Thank you. Ladies and gentlemen, this concludes today's call. Thank you for your participation. You may now disconnect.