Interactive Brokers Group Announces 2Q09 Results
Reports Income Before Taxes Of $192 Million On $332 Million In Net Revenues, Earnings Per Share Of $0.31
GREENWICH, CT, July 23, 2009 — Interactive Brokers Group, Inc. (NASDAQ GS: IBKR) an automated global electronic market maker and broker, today reported diluted earnings per share of $0.31 for the quarter ended June 30, 2009, compared to diluted earnings per share of $0.44 for the same period in 2008.
Net revenues were $332 million and income before income taxes was $192 million for this quarter, compared to net revenues of $395 million and income before income taxes of $259 million for the same period in 2008.
Business Highlights
- 58% pre-tax profit margin for this quarter.
- $4.6 billion in equity.
- 18% increase in customer accounts from the year ago quarter.
- Cleared DARTs grew by 11% to 317,000 from the year ago quarter.
- Brokerage income before tax increased 5% from a year ago quarter and 36% sequentially.
- 65% Market Making pre-tax margin for this quarter.
- 51% Electronic Brokerage pre-tax margin for this quarter.
"In this difficult climate, being possibly the only firm recording year on
year gains in the brokerage segment is a proof of concept event. Best execution
prices, industry low commissions and state of the art money management tools
give the edge to our customers over others. The better our customers do the
more business we do," said Thomas Peterffy, our CEO. "Constantly seeking our
customers' advantage ultimately inures to our own benefit."
Market Making
Market Making segment income before income taxes increased 20% in the quarter
ended June 30, 2009 compared to the prior quarter but decreased 30% from same
period last year. Pre-tax margin was 65% in this quarter, down from 74% in
the same period last year. Compared to the second quarter of 2008, this quarter
presented a less favorable environment for market makers due to tighter bid/offer
spreads on option exchanges. We managed our risk by continuing to avoid counterparty
risks and balance sheet exposure from illiquid positions by making markets
only in exchange traded products that are cleared through central clearing
houses. Market Making options contract volume remained flat during this quarter
compared to the same period last year.
Electronic Brokerage
Electronic Brokerage segment income before income taxes increased 5% in the
quarter ended June 30, 2009 compared to the same period in 2008. This increase
is attributable to strong customer account growth and trading activity over
the prior year quarter, which more than offset lower net interest income, which
was affected by historically low Fed Funds rates. Customer accounts grew 18%
to 122,000 and cleared DARTs* increased by 11% to 317,000 in the quarter ended
June 30, 2009 from the same period in 2008. Pre-tax margin increased from 48%
to 51% for the quarter ended June 30, 2009. This improvement was primarily
driven by a reduction in execution and clearing fees attributable to a reduction
in customer volumes in futures instruments and higher rebates from exchanges
with Make or Take pricing models.
Conference Call Information:
Interactive Brokers Group will hold a conference call with investors today,
July 23, 2009, at 5:30 p.m. ET to discuss its first quarter results. Investors
who would like to listen to the conference call live should dial 888-601-3873
(U.S. domestic) and 913-312-1304 (international). The number should be dialed
approximately ten minutes prior to the start of the conference call. Ask
for the “Interactive Brokers Conference Call.”
The conference call will also be accessible simultaneously, and through replays, as an audio webcast through the Investor Relations section of the Interactive Brokers web site, www.interactivebrokers.com/ir.
About Interactive Brokers Group, Inc.:
Interactive Brokers Group, Inc., together with its subsidiaries, is an automated
global electronic market maker and broker specializing in routing orders
and executing and processing trades in securities, futures and foreign exchange
instruments on more than 80 electronic exchanges and trading venues around
the world. As a market maker, we provide liquidity at these marketplaces
and, as a broker, we provide professional traders and investors with electronic
access to stocks, options, futures, forex, bonds and mutual funds from a
single IB Universal AccountSM. Employing proprietary software on a global
communications network, Interactive Brokers Group continuously integrates
its software with a growing number of exchanges and trading venues into one
automatically functioning, computerized platform that requires minimal human
intervention.
Cautionary Note Regarding Forward-Looking Statements:
The foregoing information contains certain forward-looking statements that
reflect the company's current views with respect to certain current and future
events and financial performance. These forward-looking statements are and
will be, as the case may be, subject to many risks, uncertainties and factors
relating to the company's operations and business environment which may cause
the company's actual results to be materially different from any future results,
expressed or implied, in these forward-looking statements. Any forward-looking
statements in this release are based upon information available to the company
on the date of this release. The company does not undertake to publicly update
or revise its forward-looking statements even if experience or future changes
make it clear that any statements expressed or implied therein will not be
realized. Additional information on risk factors that could potentially affect
the company's financial results may be found in the company's filings with
the Securities and Exchange Commission.
For Interactive Brokers Group, Inc. Media: Andrew Wilkinson, 203-913-1369
or Investors: Deborah Liston, 203-618-4070.
CONTRACT AND SHARE VOLUMES
(in 000's, except %)
* Includes options on futures.
**In Brazil, an equity option contract typically
represents 1 share of the underlying stock; however, typical minimum trading
quantity is 100 contracts.
To make a fair comparison to volume at other exchanges we have adopted a policy
of reporting Brazilian equity options contracts divided by their minimum trading
quantity of 100.
*Includes options on futures.
*Excludes non-customers (i.e., officers, directors and affiliated parties).
*Daily average revenue trades (DARTs) are based on customer orders.