FXCM Inc. announces Third Quarter 2016 Results 

FXCM has issued an announcement to publish Third Quarter 2016 Results.

Releases October 2016 Customer Trading Metrics

Third Quarter 2016 Highlights:

• U.S. GAAP net revenues from continuing operations of $61.4 million
• U.S. GAAP net loss attributable to FXCM Inc. from continuing operations of $35.8 million, or $6.39 per diluted share, including a $27.0 million non-cash net loss on derivative liabilities
• U.S. GAAP net revenues from discontinued operations of $8.8 million
• U.S. GAAP net loss attributable to FXCM Inc. from discontinued operations of $3.3 million, or $0.59 per diluted share
• Retail trading revenue per million traded of $65 per million
• Adjusted EBITDA from continuing and discontinued operations of $6.4 million
• Solid growth in customer equity to $725 million — up 10% from June 30, 2016 and up 6% from December 31, 2015
• Strong combined operating cash position of $227.6 million and regulatory surplus of $90.9 million at September 30, 2016

October 2016 Customer Trading Metrics from Continuing Operations(1) Highlights:

• Retail customer trading volume⁽²⁾ of $305 billion in October 2016, 6% lower than September 2016 and 9% lower than October 2015.
• Institutional customer trading volume⁽²⁾ of $24 billion in October 2016, 17% lower than September 2016 and 29% lower than October 2015.

Presentation slides for the quarter are available at http://ir.fxcm.com/.

FXCM Inc. (NASDAQ:FXCM), a leading online provider of foreign exchange, or FX, trading and related services, today announced for the quarter ended September 30, 2016, U.S. GAAP trading revenue from continuing operations of $57.8 million, compared to $56.2 million for the quarter ended September 30, 2015. U.S. GAAP net loss attributable to FXCM Inc. from continuing operations was $35.8 million (including a $27.0 million net loss on derivative liabilities) for the quarter ended September 30, 2016, or $6.39 per diluted share, compared to U.S. GAAP net income attributable to FXCM Inc. from continuing operations of $64.3 million (including a $137.6 million net gain on derivative liabilities), or $12.10 per diluted share, for the quarter ended September 30, 2015.

For the nine months ended September 30, 2016, U.S. GAAP trading revenue from continuing operations was $196.6 million, compared to $184.7 million for the nine months ended September 30, 2015. U.S. GAAP net income attributable to FXCM Inc. from continuing operations was $85.9 million for the nine months ended September 30, 2016, or $15.34 per diluted share, compared to U.S. GAAP net loss attributable to FXCM Inc. from continuing operations of $427.9 million, or $86.13 per diluted share, for the nine months ended September 30, 2015. These results include a $200.4 million net gain on derivative liabilities for the nine months ended September 30, 2016 and a $254.7 million net loss on derivative liabilities for the nine months ended September 30, 2015.

The net loss/gain on derivative liabilities consists of non-cash changes in the value of embedded derivatives associated with the Leucadia Letter and Credit Agreements (as described further below). The Letter Agreement is a component of the financing package provided by Leucadia National Corp. (“Leucadia”). On January 15, 2015, FXCM’s customers suffered negative equity balances due to the unprecedented move in the Swiss Franc after the Swiss National Bank (“SNB”) discontinued its peg of the Swiss Franc to the Euro. On January 16, 2015, FXCM entered into a financing agreement with Leucadia that permitted FXCM’s regulated subsidiaries to meet their regulatory capital requirements and continue normal operations after significant losses were incurred resulting from the events of January 15, 2015.

On September 1, 2016 we completed the restructuring of the financing arrangements with Leucadia (the “Leucadia Restructuring Transaction”). We amended the terms of the Amended and Restated Credit Agreement (the “Credit Agreement”) and replaced the Amended and Restated Letter Agreement (the “Letter Agreement”) with a new Limited Liability Company Agreement. The restructuring deepens the partnership with Leucadia and provides Leucadia with a membership interest in our operating entity, FXCM Group, LLC.

U.S. GAAP trading revenue from discontinued operations for the quarter ended September 30, 2016 was $8.8 million, compared to $13.4 million for the quarter ended September 30, 2015. U.S. GAAP net loss attributable to FXCM Inc. from discontinued operations was $3.3 million for the quarter ended September 30, 2016, or $0.59 per diluted share, compared to U.S. GAAP net income attributable to FXCM Inc. from discontinued operations of $9.3 million, or $1.76 per diluted share, for the quarter ended September 30, 2015.

U.S. GAAP trading revenue from discontinued operations for the nine months ended September 30, 2016 was $22.6 million, compared to $60.2 million for the nine months ended September 30, 2015. U.S. GAAP net loss attributable to FXCM Inc. from discontinued operations was $14.9 million for the nine months ended September 30, 2016, or $2.67 per diluted share, compared to U.S. GAAP net loss attributable to FXCM Inc. from discontinued operations of $21.1 million, or $4.24 per diluted share, for the nine months ended September 30, 2015.

For the nine months ended September 30, 2016, operating expenses include a $2.3 million settlement of a longstanding legal matter.

Adjusted EBITDA from continuing and discontinued operations was $6.4 million for the quarter ended September 30, 2016 compared to $5.2 million for the quarter ended September 30, 2015.

Adjusted EBITDA from continuing and discontinued operations was $27.6 million for the nine months ended September 30, 2016 compared to $25.6 million for the nine months ended September 30, 2015.

Adjusted EBITDA from continuing operations was $2.1 million for the quarter ended September 30, 2016 compared to a loss of $1.3 million for the quarter ended September 30, 2015.

Adjusted EBITDA from continuing operations was $20.5 million for the nine months ended September 30, 2016 compared to a loss of $0.7 million for the nine months ended September 30, 2015.

Adjusted EBITDA is a Non-GAAP financial measure. This measure does not represent and should not be considered as a substitute for net income or net income attributable to FXCM Inc., each as determined in accordance with U.S. GAAP, and our calculations of this measure may not be comparable to similarly titled measures reported by other companies. See “Non-GAAP Financial Measures” beginning on A-3 of this release for additional information regarding this Non-GAAP financial measure and for a reconciliation of such measure to the most directly comparable measure calculated in accordance with U.S. GAAP.

FXCM Inc. today announced certain key customer trading metrics for October 2016. Monthly activities included:

October 2016 Customer Trading Metrics from Continuing Operations ⁽¹⁾

Retail Customer Trading Metrics

• Retail customer trading volume⁽²⁾ of $305 billion in October 2016, 6% lower than September 2016 and 9% lower than October 2015.
• Average retail customer trading volume⁽²⁾ per day of $14.5 billion in October 2016, 1% lower than September 2016 and 5% lower than October 2015.
• An average of 538,098 retail client trades per day in October 2016, 4% lower than September 2016 and 5% higher than October 2015.
• Active accounts⁽³⁾ of 177,949 as of October 31, 2016, an increase of 131, or 0.1%, from September 30, 2016, and a decrease of 324, or 0.2%, from October 31, 2015.
• Tradeable accounts⁽⁴⁾ of 154,986 as of October 31, 2016, a decrease of 81, or 0.1%, from September 30, 2016, and a decrease of 6,099, or 4%, from October 31, 2015.

Institutional Customer Trading Metrics

• Institutional customer trading volume⁽²⁾ of $24 billion in October 2016, 17% lower than September 2016 and 29% lower than October 2015.
• Average institutional trading volume⁽²⁾ per day of $1.1 billion in October 2016, 15% lower than September 2016 and 31% lower than October 2015.
• An average of 37,709 institutional client trades per day in October 2016, 9% lower than September 2016 and 32% higher than October 2015.

More information, including historical results for each of the above metrics, can be found on the investor relations page of FXCM’s corporate website www.fxcm.com.

This operating data is preliminary and subject to revision and should not be taken as an indication of the financial performance of FXCM Inc. FXCM undertakes no obligation to publicly update or review previously reported operating data. Any updates to previously reported operating data will be reflected in the historical operating data that can be found on the Investor Relations page of the Company’s corporate website www.fxcm.com.

⁽¹⁾ Customer Trading Metrics from Continuing Operations excludes discontinued operations of FXCM Japan and FXCM Hong Kong.

⁽²⁾ Volume that FXCM customers traded in period is translated into US dollars.

⁽³⁾ An Active Account represents an account that has traded at least once in the previous twelve months.

⁽⁴⁾ A Tradeable Account is an account with sufficient funds to place a trade in accordance with FXCM trading policies.

Source: FXCM

 

 

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