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Brexit-linked derivatives trade boosts Deutsche Boerse revenue

The plaque of the Deutsche Boerse AG is pictured at the entrance of the Frankfurt stock exchange February 1, 2012. REUTERS/Alex Domanski/File Photo (Reuters)

By Jonathan Gould FRANKFURT (Reuters) - Deutsche Boerse said it was on course to reach its 2016 earnings target after net revenue rose 10 percent in the second quarter, helped by higher derivatives trading linked to Britain's vote to leave the European Union. The German exchange operator, which is planning a $27 billion merger with the London Stock Exchange Group , said quarterly net revenue rose to 601 million euros ($660.38 million) from 547 million a year earlier, driven by stronger trade in index derivatives and commodities business at its Eurex derivatives unit, as well as consolidation effects. Trading volumes on the cash and derivatives markets increased around the date of the UK referendum and were very high the day after the vote, said Deutsche Boerse, which makes more money when trading is brisk. "After the first six months we are fully on track to achieve our full-year forecast," Chief Financial Officer Gregor Pottmeyer said in a statement. The company is aiming for net revenue growth of 5-10 percent this year and targets annual operating and net profit growth of 10-15 percent. Deutsche Boerse repeated its commitment to meeting all regulatory requirements to secure the closing of the merger with the LSE. Shareholders of both groups have already given their blessing. However, it remains unclear whether the deal will get approval from financial regulators in Germany and Britain, along with European Union antitrust authorities. Deutsche Boerse plans to use $290 million of the $1.1 billion in proceeds from the sale of its U.S. options exchange operator International Securities Exchange to Nasdaq to buy back outstanding private placements, which could help to improve its standing with credit rating agencies. "We have not yet decided upon the use of the remaining funds," Pottmeyer said of the plans. Quarterly earnings before interest and tax (EBIT) rose 8 percent to 279 million euros, while net profit rose more than 9 percent to 184 million euros. ($1 = 0.9101 euros) (Reporting by Jonathan Gould, editing by David Evans)