MarketAxess Reports First Quarter 2015 Record Revenues 

MarketAxess Reports First Quarter 2015 Record Revenues of $76.8 Million, Record Pre-Tax Income of $38.5 Million and Record Diluted EPS of $0.65

First Quarter Financial Highlights*

• Record revenues of $76.8 million, up 21.1%
• Record pre-tax income of $38.5 million, up 39.0%
• Record diluted EPS of $0.65, up from $0.46
• Record total trading volume of $243.7 billion, up 30.0%

*All comparisons versus first quarter 2014.

MarketAxess Holdings Inc. (Nasdaq:MKTX), the operator of a leading electronic trading platform for fixed-income securities, and the provider of market data and post-trade services for the global fixed-income markets, today announced results for the quarter ended March 31, 2015.

“We are happy with the strong start to 2015 with record revenues, pre-tax income and EPS, driven by year-over-year volume and market share growth across all of our key products,” said Richard M. McVey, Chairman and CEO of MarketAxess. “Our investment in Open Trading is delivering greater value to our clients through expanded liquidity sources and lower transaction costs. We also saw continued momentum in our European business, as enhancements to our trading system and the launch of unique data tools helped drive significant trading volume gains.”

First Quarter Results

Total revenues for the first quarter of 2015 increased 21.1% to a record $76.8 million, compared to $63.4 million for the first quarter of 2014. Pre-tax income was a record $38.5 million, compared to $27.7 million for the first quarter of 2014, an increase of 39.0%. Pre-tax margin was 50.2%, compared to 43.7% for the first quarter of 2014. Net income totaled $24.6 million, or $0.65 per share on a diluted basis, compared to $17.5 million, or $0.46 per share, for the first quarter of 2014.

Commission revenue for the first quarter of 2015 increased 28.9% to a record $67.0 million, compared to $52.0 million for the first quarter of 2014. Variable transaction fees increased 43.3% to $51.3 million on total trading volume of $243.7 billion for the first quarter of 2015, compared to variable transaction fees of $35.8 million on total trading volume of $187.4 billion for the first quarter of 2014. U.S. high-grade trading volume as a percentage of FINRA’s high-grade TRACE trading volume increased to an estimated 15.6% on an adjusted basis, compared to an estimated 13.4% for the first quarter of 2014. See Non-GAAP Financial Measures and Other Items below for further information on FINRA TRACE volume and U.S. high-grade market share.

All other revenue, which consists of information and post-trade services, technology products and services, investment income and other revenue, decreased to $9.8 million for the first quarter of 2015, compared to $11.4 million for the first quarter of 2014. Lower technology-related professional consulting services fees and the unfavorable impact of the strengthening U.S. dollar accounted for the decline in all other revenue.

Total expenses for the first quarter of 2015 increased 7.2% to $38.3 million, compared to $35.7 million for the first quarter of 2014. The increase in total expenses was principally due to higher employee compensation and benefits costs of $2.6 million.

The effective tax rate for the first quarter of 2015 was 36.1%, compared to 36.9% for the first quarter of 2014.

Dividend

The Company’s board of directors declared a quarterly cash dividend of $0.20 per share of common stock outstanding, to be paid on May 21, 2015 to stockholders of record as of the close of business on May 7, 2015.

Share Repurchase Program

A total of 117,400 shares were repurchased in the first quarter of 2015 at a cost of $8.9 million under the Company’s $100.0 million share repurchase program. As of March 31, 2015, approximately $53.1 million was available for future repurchases under the program.

Balance Sheet Data

As of March 31, 2015, total assets were $378.7 million and included $223.2 million in cash, cash equivalents and securities available-for-sale. Total stockholders’ equity as of March 31, 2015 was $344.7 million.

Source: MarketAxess 

 

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