Deutsche Boerse AG

XETRA:DB1

Earnings Call Analysis

Deutsche Börse Q3 Earnings and Outlook

Deutsche Börse AG achieved a net revenue growth of 6%, hitting expectations and showcasing its robust business model amid varied market conditions in Q3 2023. The Commodities business outperformed, charting a 19% growth over the first 9 months, contributing to an overall 15% net revenue growth in the same period. Cost fluctuations stabilized, resulting in an 8% organic cost growth year-to-date, while EBITDA surged by 17%. Encouraged by 2023's strong performance and following the SimCorp acquisition, the company revised its full-year guidance upwards, expecting about EUR 5 billion in net revenues and EUR 2.9 billion in reported EBITDA.

Deutsche Börse's strong third quarter bolstered by growth and acquisitions

Deutsche Börse reported a robust financial performance in the third quarter of 2023, indicating net revenue growth of around 6% for the year, which aligns with the company's expectations. This positive development is largely attributed to Deutsche Börse's diversified business model and the significant contributions from the Commodities business, which alone grew 19% in net revenues in the first nine months. The increased interest rates benefitted net interest income, more than offsetting the effects of lower market volatility. Operational costs increased by 8%, and EBITDA, excluding extraordinary items related to the new Investment Management Solutions segment, rose by 17%. Due to this strong performance and the initial integration of SimCorp in Q4, Deutsche Börse upgraded its full-year guidance to approximately EUR 5 billion in net revenues and a reported EBITDA of around EUR 2.9 billion.

SimCorp acquisition catalyzes creation of the Investment Management Solutions Segment

The acquisition of SimCorp signals a strategic expansion for Deutsche Börse, launching the new Investment Management Solutions segment. SimCorp provides a prominent SaaS investment management platform, which aligns with the company's aim to diversify its business mix, increase buy-side presence, and improve recurring revenues. Expected to drive value creation through cross-selling and efficiency gains, the acquisition is predicted to yield around EUR 90 million in EBITDA synergies. As of September 29, the acquisition has seen a 94% acceptance rate from SimCorp shareholders, allowing a swift completion of the squeeze-out process and the beginning of synergy realization in October.

Investor Day set to unveil growth prospects and midterm guidance

Deutsche Börse is gearing up for an Investor Day event on November 7, focused on detailed insights into the Investment Management Solutions segment and its growth potential. The engagement will feature presentations by top executives from SimCorp and ISS, and the Deutsche Börse Executive Board will introduce the 'Horizon '26 framework', outlining midterm guidance. The event, leveraging the company's recent strategies and growth plans, is anticipated to further illuminate the future trajectory and performance expectations of the new segment.

A thorough review of financial performance and exceptional costs

The first nine months of 2023 saw Deutsche Börse thrive financially due to consistent growth and cyclical shifts in market conditions, which included higher interest rates benefiting net interest income. Operating costs increased by 11%, but adjusted for exceptional items for the Investment Management Solutions segment, the growth stood at 8%. A 20% cash EPS growth was evident, excluding exceptional items. The third quarter observed a moderated pace with a mix of secular growth, offset by reduced market volatility. Exceptional effects totaling EUR 37 million for the third quarter were related to the SimCorp acquisition and the creation of the new segment. Excluding these, cash EPS growth for the Q3 was 18%.

Trading & Clearing: Adjustments amid market normalization

The Trading & Clearing segment adapted to the market normalization post Q1 volatility, with commodities markets showing resilience from the energy crisis and activity in power products increasing 41% in net revenue. Notwithstanding the reduction in peak level revenues, the segment still performed robustly with about EUR 30 million in margin revenues.

Cash balances, seasonality, and visibility in financial outcomes

Cash balances saw a decrease from EUR 17 billion to EUR 15 billion in Q3, primarily due to seasonality with lower trading volumes and volatility during the summer months. Despite expectancies for cash balances to recover in Q4, an increasing sensitivity to allocation strategies has been observed among institutions due to elevated U.S. dollar and euro rates. The reduction in balances during Q3 remains mainly seasonal, but attention remains on how this may affect ensuing quarters.

Steady guidance for the future despite dynamic financial landscapes

In addressing inquiries from analysts, management clarified their depreciation and amortization guidance of EUR 125 million for Q4, citing ongoing investments and anticipated increases in future CapEx. The company foresees continued supplementary expenses in depreciation in the coming year and confirmed that there will be no changes to guidance for 2024, maintaining investor confidence in the face of dynamic financial changes.

Earnings Call Transcript 2023-Q3

[Operator]

Good afternoon, ladies and gentlemen, and welcome to the Deutsche Börse AG Analyst and Investor Conference Call regarding the Q3 2023 Results. [Operator Instructions]

Let me now turn over to Mr. Jan Strecker.

[Jan Strecker, executive]

Welcome, ladies and gentlemen, and thank you for joining us today to go through our third quarter 2023 results. With me are Theodor Weimer, CEO; and Gregor Pottmeyer, CFO. Theodor and Gregor will take you through the presentation today. And afterwards, we will be happy to take your questions. The link to the presentation materials for this call has been sent out by e-mail, and they can also be downloaded from the IR section of our website. As usual, this conference call will be recorded and will be available for replay.

Let me now hand over to you, Theodor.

[Theodor Weimer, executive]

Thank you, Jan. Welcome, ladies and gentlemen. Let me first comment on the financial performance in the first 9 months of the year. Afterwards, I will give you an update on the strong progress we have made with the SimCorp acquisition and the creation of the new Investment Management Solutions segment at Deutsche Börse.

The second -- net revenue growth this year of around 6% is in line with our expectation and the consistent delivery is proof how well our diversified business model is working. With regards to the cyclical influence, we saw two different trends over the course of the year. On the one hand side, lower and range-bound market volatility, except for the spike in March resulted in cyclical headwinds for some of our Trading & Clearing businesses. On the other hand, further increasing interest rates resulted in a much stronger net interest income compared to our original expectations. This, by far, compensated the volatility effects.

Very noteworthy is also the development of our Commodities business. After almost 40% net revenue growth last year, we achieved another 19% net revenue growth in the first 9 months of this year. This is mainly because of the normalization of trading activity and a significant step-up of our market share against OTC in power derivatives due to the benefits of clearing for our clients. Overall, this development resulted in 15% net revenue growth in the first 9 months.

As expected, the operating cost growth decelerated in the third quarter, and therefore, the organic cost growth year-to-date amounted to 8%. As a result, EBITDA, excluding exceptionals in relation to our new Investment Management Solutions segment, increased by 17%.

Because of the strong development in 2023 so far, the outlook for the rest of the year and the initial consolidation of SimCorp in the fourth quarter, we again increased our guidance for the full year. We now expect net revenues of around EUR 5 billion and a reported EBITDA of around EUR 2.9 billion.

This brings me to the SimCorp acquisition and integration of the new Investment Management Solutions segment on Page 2. With SimCorp, we are now taking another leap forward. SimCorp offers an industry-leading front-to-back SaaS investment management platform and ecosystem. The acquisition will contribute significantly to our secular growth by helping us to address trends in the asset management industry. In addition, it will help us to further diversify our business mix, grow our buy-side exposure and last, but not least, increase our recurring revenues. Therefore, there's an extremely strong fit with our strategy.

Together with the combined ISS and Qontigo business, a leading ESG data and index provider, will transform our current Data & Analytics segment into the much broader Investment Management Solutions segment. This is expected to result in significant value creation from cross-selling opportunities and efficiency gains. In total, we expect run rate EBITDA synergies of around EUR 90 million.

Since the announcement of the transaction at the end of April, we've made excellent brokers and closed the SimCorp acquisition in line with our plans on September 29. The tender offer for SimCorp shareholders on the Danish loan has achieved an exceptionally good result of 94% acceptance rate. This allows us to complete the squeeze-out process already in October, which should result in slightly accelerated synergy ramp-up.

On September 22, we successfully issued EUR 3 billion of senior bonds with tenures of 3 to 10 years to finance the SimCorp acquisition. The effective yield on the bonds amounted to 3.5% to 3.9%, which includes the effect of hedges we entered into in May this year. The bonds have been issued by Clearstream's new digital post-trade infrastructure, D7.

During our Investor Day on November 7, we will dive deeper into the two parts of our new Investment Management Solutions segment and the excellent growth opportunities. Christian Kromann, CEO of SimCorp and Gary Retelny, CEO of ISS, will present their respective business in detail. In addition, my colleagues on the Executive Board and myself will present further growth opportunities under our new strategy, Horizon '26 framework and provide you with our midterm guidance. The event will take place at our headquarters in Eschborn, and we are looking forward to welcoming many of you here.

With that, let me hand over to you, Gregor.

[Gregor Pottmeyer, executive]

Thank you, Theodor. On Page 3, we show the details of the results for the first 9 months. The financial performance throughout the first 9 months was very positive. Besides the consistent secular growth, the cyclical drivers for the strong performance shifted somewhat during the period.

In the first quarter, the development was partly driven by elevated market volatility, while in the second and third quarter, we saw full benefit from higher interest rates in our net interest income. The operating costs overall increased by 11% in the period. Adjusted for exceptional cost items in relation to the creation of the new Investment Management Solutions segment, operating cost growth amounted to 8%.

The organic cost growth was driven by a couple of effects. Slightly less than half of the cost growth was driven by inflationary effects from fielding operations, general purchasing and higher staff costs. The rest is a function of higher investments into growth and infrastructure as well as an increase in FTE to support the growth ambition of our organization. The cash EPS growth in the first 9 months, excluding exceptional items, amounted to 20%.

This brings me to the details of the third quarter results on Page 4 of the presentation. While the secular growth developed in line with our expectation, the cyclical growth from higher net interest income was partly offset by a decline of activity in financial derivatives and cash equities because of lower market volatility. The operating costs in the third quarter included around EUR 37 million exceptional effects related to the SimCorp acquisition and the creation of the new Investment Management Solutions segment, around half of that, the SimCorp transaction costs, and the other half cost to achieve the synergies. The operating cost growth, excluding those items, amounted to 5%.

In addition, depreciation and amortization included an impairment of EUR 25 million in Crypto Finance. Due to the ongoing weakness of crypto markets, we decided to fully impair the intangibles relating to debt assets. The cash EPS growth in the third quarter, excluding those exceptional items, amounted to 18%.

I'm now turning to the results of the segment, starting with the former Data & Analytics segment on Page 5. The weaker U.S. dollar turned into a substantial net revenue headwind in the third quarter. Adjusted for FX, the net revenue growth of the segment amounted to 11%, which is very much in line with our expectation. Though currency adjusted growth of the ESG business is below the strong level we have seen last year, it's still ranging from high single digit to small double-digit year-to-date depending on the product line. We are firmly convinced that investor demand and regulation as well as rising complexity in performance and reporting requirements will continue to drive the need for trusted and comprehensive ESG data solutions.

Analytics benefited from another seasonal renewal of contracts of existing clients, which is encouraging and resulted in some point-in-time net revenue. The EBITDA in this segment was affected by the exceptional cost items and a small negative impact from the return from financial investments. Adjusted for those effects, the EBITDA increased in line with the net revenue.

Let me turn to Slide 6, the Trading & Clearing segment. After the spikes of volatility in the first quarter, we saw some normalization of activity in the second and third quarter with the restocks in the range of around 15 to 20. In financial derivatives and Eurex, the improving equity market conditions resulted in reduced demand for equity and index derivatives, broadly to a level we have seen already in the second quarter. As expected, this also resulted in a decline of the collateral requirements for clearing and thus, has a decline of margin revenues to EUR 19 million. This compares to around EUR 35 million in Q3 and Q4 last year when this line item peaked.

In Commodities, markets continued to recover from the energy crisis. Volatility has significantly declined and prices across our markets have seen a healthy development. This translated into a strong upward trend in power products, which suffered under uncertainty last year, with net revenue increasing 41%. Margin revenues from the Commodities clearinghouse came down compared to the peak last year, but still amounted to around EUR 30 million.

In the Fund Services segment on Page 7, the continued onboarding of new clients and funds helped us to offset the ongoing cyclical headwinds and develop better than the market. Cyclical headwinds continue to mainly arise from the trend away from active equity funds into passive funds and fixed income. The carve-out of fund services from the core business of Clearstream is now largely completed but the third quarter still included some one-off effects in the operating costs.

Our Securities Services segment on Slide 8 saw a continued strong performance in the third quarter. Main driver was the net interest income, which amounted to EUR 169 million. This excludes the EUR 15 million net interest income that are now reported in the Fund Services segment.

Total cash balances on average amounted to EUR 15 billion in the quarter, which is somewhat less compared to last quarter. This is partly driven by a seasonal effect we see every year, but we also assume that clients are now managing their balances somewhat tighter because of higher interest rates. This does not really change our view for the full year and we continue to expect a level of around EUR 700 million net interest income in Securities and Fund Services together.

This brings me to the outlook on Page 9. Theodor already outlined our revised guidance for the full year. We are now expecting net revenue of around EUR 5 billion and EBITDA of around EUR 2.9 billion. This guidance includes our assumptions for the development in the final 2 months of the year and the SimCorp consolidation effects, including the expected exceptional cost items.

In Q4, SimCorp is expected to contribute around EUR 185 million of net revenue and around EUR 85 million of EBITDA before exceptional cost items. For 2023, we are expecting around EUR 50 million of total cost to achieve synergies, of which around EUR 21 million have already been booked so far. We have also booked all the transaction costs already in the first 9 months, which amounted to around EUR 21 million.

As a result of the SimCorp acquisition, depreciation and amortization is expected to increase to a quarterly level of around EUR 125 million in the fourth quarter. Because of the financing of the SimCorp acquisition, we expect our financial results to increase to around EUR 50 million in Q4 and around EUR 40 million per quarter on average next year.

This concludes our presentation. We are now looking forward to your questions.

[Operator]

[Operator Instructions] And the first question comes from Arnaud Giblat from BNP Paribas Exane.

[Arnaud Giblat, analyst]

Just one question then. I was wondering if you could talk a bit more about the cash balances of Clearstream. You mentioned that there was seasonality in September, a good level on which -- September represents a more normalized level of cash balances, I suppose.

And I'm just wondering how much visibility we can get into how cash balances are going to evolve. Historically, you said it's been a function of secure -- of settlement activity. Is there something changing there? Because the reason I'm asking is interest rates have been up for some time now. If there had been any optimization, you would have expected this to have happened already. So is there anything really changing with clients?

[Gregor Pottmeyer, executive]

Yes. Thanks, Arnaud, for the question. Yes, indeed, the cash balances decreased compared to the second quarter from EUR 17 billion now to EUR 15 billion. I think if you compare this with last year, then indeed, Q3 is specifically, with the summer months of July and August, very much weaker, months with the lower volume and what we have also seen, lower volatility, obviously, in Q3. So that's the main reason for the decline of the cash balances. And so far, we expect that this will disappear in Q4.

But nevertheless, you also see that some clients have now a higher sensitivity because if the U.S. dollar rates are above 5% and the euro rates above 4%, obviously, there is some pressure into the institutions to allocate cash in a reasonable way. But the development in Q3 is mainly driven by seasonality.

[Arnaud Giblat, analyst]

If I can just follow up, you mentioned volatility as a key input. Should we think about rate volatility or settlement activity or asset -- the custody as a driver of cash balances?

[Gregor Pottmeyer, executive]

No, both of that, right? So it's on the one hand side, the settlement activity, but also the lower volatility in the bond rate and also in the equity.

[Operator]

And the next question comes from Andrew Coombs from Citi.

[Andrew Coombs, analyst]

I just wanted to come to the depreciation and amortization guidance of EUR 125 million for Q4 and the financial result, EUR 50 million. Is it fair to annualize that as an outlook for 2024? Or are there any other key drivers we should be aware of?

[Gregor Pottmeyer, executive]

Yes. So the key challenge for you was so far that with regard to the depreciation, you do not know the purchase price allocation basically. And to be very honest, it's still not finalized with the auditor. But we wanted to give you, at least some guidance with regard to the Q4 number, what we currently expect, and that's why we guided EUR 125 million out of the depreciation, what we have here, where we roughly include EUR 20 million PPA. But again, it's preliminary and it's not finally agreed.

And with regard to 2024, so we expect also a normal increase in the depreciation as we still continue to increase our CapEx. And therefore, you will also see some higher depreciation in 2024 compared to the Q4 guidance.

[Andrew Coombs, analyst]

If I could just follow up on the PPA. Is there a pull-to-par time table on those?

[Theodor Weimer, executive]

Sorry, could you repeat that, Andrew, please?

[Andrew Coombs, analyst]

Sorry, on the PPA, is there a pull-to-par time frame envisaged on that?

[Theodor Weimer, executive]

Time frame in what sense? Until we know the final numbers? Or...

[Andrew Coombs, analyst]

I'm assuming it's a fair value of assets and what you'll see as a pull-to-par effect as those assets are held effectively. So I'm just trying to work out kind of if there's an adjustment that will close over time.

[Theodor Weimer, executive]

No, there's none. That's the regular depreciation, which will be with us for the foreseeable future. So this is not changing next year. The year after next year, this is the same amount...

[Andrew Coombs, analyst]

Okay. The EUR 20 million permanent addition is part of the fair value -- okay. No, that's great. And on the financial result, if you could just comment, because I think you previously said that you had EUR 2 billion of debt that you prefinanced at 3%. Obviously, you then would lose some yield on the cash, but it does still seem quite like a big step up in the financial results. So is there anything else there that we should be thinking about?

[Gregor Pottmeyer, executive]

No, there's nothing else specific. So again, here, we wanted to give you some guidance, what the EUR 3 billion bond refinancing, what is the impact out of that, right? And therefore, you can basically calculate it's a EUR 30 million per quarter additional funding cost. And that's why we guided the number as it is.

In Q4, there are still the commercial paper as a short-term funding element. Therefore, you see a little bit higher level of financial result, but there's roughly close to EUR 10 million. It varies very fast, disappear in 2024 because we expect that the commercial paper programs are already reduced to 0 in Q1, within Q1, right? So it's very, very fast where we're able, and that's why we did the short-term funding, because we already knew at that point of time that we will be able to reduce it to 0 within 6 months.

So that's why we said overall, the existing bond portfolio leads roughly to a EUR 10 million quarterly interest expenses. So -- and then for the next year, another EUR 30 million out of this bond. So that's a EUR 40 million -- that's the composition of the EUR 40 million for next year.

[Andrew Coombs, analyst]

That's great. I think I turned my 1 question into 3, so I'll duck out there.

[Operator]

The next question comes from Enrico Bolzoni from JPMorgan.

[Enrico Bolzoni, analyst]

One was on the guidance for SimCorp. Here, you're guiding for the fourth quarter for EUR 185 million revenues and EUR 85 million in EBITDA but the guidance has not really changed for 2024. So I just wanted to ask, with respect to the EBITDA, clearly, that would imply a step down compared to Q4, if I think about for next year. Can you just give us some color on why actually this is going to happen? And related to that, can you already provide any commentary in terms of what sort of seasonality in terms of revenues we should expect SimCorp going forward?

And then a second question, just related to those impairment on Crypto Finance. Can you just remind us, are there any other intangibles related to that after that potentially might be impaired going forward?

[Theodor Weimer, executive]

Yes. So starting with your third question, very easy. There are no other intangibles anymore. So we fully write it down. So no further risk in the future anymore.

With regard to the SimCorp numbers, so yes, there is a strong seasonality. Q4 is by far the strongest quarter compared to the other 3 quarters. And it's 35% plus roughly in Q4, what you can expect from a revenue perspective. Therefore, this EUR 184 million is including that kind of seasonality, what we expect. And therefore, this EUR 85 million EBITDA is also above the EBITDA margin that we usually have.

So overall, for full year, as we confirm our guidance for 2024, we expect some 33% EBITDA margin, so the EUR 200 million EBITDA and the EUR 600 million net revenue. And these are numbers purely on a standalone basis business. These are synergies. Obviously, synergies will help us to increase that margin. And obviously, it's also the intention to show some scalability over the next years in the standalone case. So overall, EBITDA margin, as already said to you, will increase over time to a level of 40% plus, right? So that's our expectation and our clear commitment.

[Operator]

The next question comes from Benjamin Goy from Deutsche Bank.

[Benjamin Goy, analyst]

As for the question on SimCorp, so you mentioned a 7% net revenue growth in the first 9 months. I was just wondering if you can compare that to H1 because I believe they only do gross revenue, how the business has developed. And if you could add a bit more color on the different revenue streams on-premise and professional service, that would be helpful.

[Gregor Pottmeyer, executive]

Yes. So far, we do not want to go in all the details for the first 9 months because it's not -- obviously not the responsibility of Deutsche Börse anymore. So we took over basically, beginning 1st of October. And that's why we really focused on Q4. And also, we confirmed the outlook for -- with regard to 2024. But we just wanted to highlight that the business is growing, right? And the business is growing by 7% for the first 9 months.

And there are always -- it doesn't make so many sense to follow on a quarterly basis because it really depends what kind of contracts you made in a single quarter, not just -- so overall, they are exactly in line, what they guided. So I think you have a full year guidance from SimCorp. And it's just in our internal discussion, they just confirmed that they will achieve their guidance and therefore, they were fully in line with what was planned.

[Operator]

And next up is Kyle Voigt from KBW.

[Kyle Voigt, analyst]

I believe you recently launched 0DTE options on the stock index. I know it's still early days, but just wondering if you could comment on the demand you're seeing so far since launch. And then of the early volume you're seeing in those 0-day expirations, just wondering if you could provide any more color on where the flow is coming from, and particularly interested to hear if more of that is coming from the U.S. or retail specifically.

[Theodor Weimer, executive]

Yes. I think we've briefly touched upon this already on the last earnings call, Kyle. There are certainly some demand for those products, that's why we've launched them. But as you know, the R&D costs to launch an additional sort of derivatives contract are pretty small. So there's no huge effort really because the system is in place.

So we see some demand with engaged market makers but the difference compared to the U.S. is that this is a professional product, right? So there is no real retail participation on derivatives markets in Europe compared to the U.S. And therefore, I think the overall size of the opportunity is also much smaller.

So we see this as one of the elements to grow the business structurally. There are many different other products. And in total, we are able to achieve also nice secular growth rate at Eurex, but it's just one piece of the puzzle.

[Operator]

And next up is Bruce Hamilton from Morgan Stanley.

[Bruce Hamilton, analyst]

Another one on SimCorp. And just going back to Andrew's point, to the extent that you can check because I know you'll be talking more about this at the Investor Day. But -- so it seems like versus the initial guidance for sort of mid-single-digit accretion, what we're seeing is slightly higher cost of funding and then possibly a slightly higher D&A. And so although you make a positive comment about getting the synergies off to a faster start, it sounds like you've got to sweat the assets harder to hit that mid-single-digit accretion. Is that the correct read?

[Gregor Pottmeyer, executive]

No, I don't think that, that's a correct read. So from our perspective, everything works according to plan. So no reason to deviate from that. So the cost of funding, just when you take the rate, so we hedged some months ago, and we have a very strong mid-double-digit million saving out of that, so therefore, no, the cost of funding are according to plan.

The D&A, we will finally see what is the final outcome when we discuss this with the auditor. And again, the business development is -- will appear as it's planned. So for next year, with EUR 600 million net revenue, I think that's a strong increase, right, on a like-for-like basis. It's double digits, right? So that is obviously very positive here. And the ARR is also double-digit growth. It's already guided by SimCorp and we can confirm that, that is also currently happens. So there are very positive elements, what we see here.

With regard to the synergies realization, the more we go into the details, the more fun we see with joining forces between Deutsche Börse and SimCorp. And so far, that looks quite promising. And we are quite confident that we achieve everything, what we guided so far, and we will deliver the details on our Investor Day on November 7.

[Operator]

And the next question comes from Hubert Lam from the Bank of America.

[Hubert Lam, analyst]

Just got one question again on SimCorp. So I think you've reiterated your target of EUR 90 million of EBITDA synergies for SimCorp. Do you see any upside to that, just given that you can now squeeze out the minorities and maybe at the point, at a time when you gave the original guidance, you weren't sure if that was going to happen? So possibly, could there be upside to that synergy target today?

[Gregor Pottmeyer, executive]

No, I think it's too early to talk about that. So it's our clear commitment that we are delivering the EUR 90 million synergy, EBITDA synergy. So EUR 55 million cost synergies, EUR 35 million revenue synergies. We are in the middle of implementing and realization of the plans and therefore, we're optimistic to deliver these additional synergies. And again, we will give the update on November 7.

[Operator]

And next up is Michael Werner from UBS.

[Michael Werner, analyst]

Just wanted to ask about the collateral management business within Securities Services. I believe we've seen improving or increasing balances as we've gone through this year. But it seems like the revenues have been, for the most part, flattish. I'm just wondering if you can help us understand what's going on there and what the outlook looks like for the next couple of quarters.

[Theodor Weimer, executive]

Yes, Mike, so this is a business that has many, many different components. You're right, we have sort of stood at around EUR 26 million to EUR 27 million of net revenue per quarter. That's part of the custody revenue line item, but there are higher yielding and lower-yielding parts. So for instance, if you have securities lending, then it's typically market dependent, a higher share we are taking in relation to the value. If you have a simple sort of repo transaction then it's typically a lower share.

So it also depends on the product mix. So therefore, the volumes are a lead indicator, but the product mix also matters. What's good to see is that it's up significantly year-to-date compared to last year. So there's definitely more demand in the market.

[Operator]

And the next question comes from Ian White from Autonomous Research.

[Ian White, analyst]

I just wondered on Data & Analytics, can you call out for us, please, the extent of the point-in-time revenue contribution in analytics in the quarter? And then sort of by extension, the 11% constant currency net revenue growth that you've highlighted for Data & Analytics on Slide 5, what would that number have been on a sort of a true like-for-like basis, I guess?

There's -- I think there's a transfer now of EUR 2 million to EUR 3 million a quarter in the index business that was booked sort of entirely in 4Q last year. So there's sort of a bit of growth from that.

There's a point-in-time difference in analytics as well. So if we kind of smooth those things out, what would be the sort of true constant currency growth rate in that business, please?

[Gregor Pottmeyer, executive]

Yes. So with regards to your two questions around the currency FX impact and the point-in-time revenue impact. So with regard to the FX, again, for the Data & Analytics segment, in total, it's a plus 5% -- sorry, it's 6%. So it's overall 11% on a constant cross-currency basis, specifically on U.S. dollar. And that was a little bit higher in Q3 compared to the first half year. So it's a very big impact in Q3 here. And I don't think that it will be the same number in Q4, but it's not really a specific situation in Q3.

With regard to the point-in-time revenue, so overall, the point-in-time revenues are roughly 25% to 30% of the Axioma business, and therefore, it really depends now on a quarterly basis and then the contract renewals, et cetera. And indeed, there is some positive element here in Q3. And it was also the majority of the increase comes from point-in-time revenue, but we can also state that the analytics business from a run rate perspective is growing double digits. So that's -- that we can control.

[Operator]

And the next question comes from Johannes Thormann of HSBC.

[Johannes Thormann, analyst]

Two questions left. First of all, on your cash balances, you said clients become more sensitive. Is this only in terms of managing the balance levels? Or do you already get requests for revenue sharing? And secondly, on the costs achieved, are there the transaction-related costs on top of it or included in the current year guidance?

[Gregor Pottmeyer, executive]

Yes. So with regard to the cost to achieve, so the transaction costs are on top of it. So the cost to achieve, we guide basically 2x EUR 50 million, or EUR 50 million for this year, EUR 50 million for next year. And the EUR 21 million transaction costs are on top of it. So it's -- then it's EUR 121 million, all including.

As regard to the cash balances, the first question of Clearstream, no, we continue not to share revenues on the NII with the client. So the reduction purely comes from the reduced cash balances.

[Jan Strecker, executive]

All right. There are no further questions in the pipeline, so we would like to conclude today's call. Thank you very much for your participation. If there's anything else, then please do feel free to reach out any time. Thank you.