Global brokerage company, BGC Partners, has announced its results for the second quarter of 2014. Focusing on the foreign exchange part of business we are seeing revenues rise by 25% in the company’s fully electronic FX business, with the quarter on quarter figure marking a 5% decline due to low volatility throughout the second quarter and regulatory issues affecting BGC’s bank customers.
At the same time the company is reporting that volumes of foreign exchange derivatives and spot FX have totaled $2.45 trillion, which is higher by 17% over last quarter’s figures. According to the company’s earnings announcement, GAAP revenues were lower by 65% to $417 million, while on the bottom line the firm registered a 92% decline to $14.9 million, which is 92% lower when compared to last year’s numbers. These are the last year-on-year results affected by the sale of the firm’s eSpeed business to NASDAQ OMX.
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Howard W. Lutnick, Chairman and Chief Executive Officer of BGC, stated: “We achieved this improvement in the face of difficult market conditions in our Financial Services segment, and despite the sale of eSpeed, which generated approximately $24 million in revenues and $14.2 million in pre-tax profits in the second quarter of 2013.”
He elaborated on the eSpeed sale, stating: “Within a year of the NASDAQ OMX transaction, we have effectively replaced the distributable earnings from eSpeed. We expect our pre-tax distributable earnings to increase by between 39 percent and 60 percent year-on-year in the third quarter of 2014. Our cash position5 is over $640 million and we expect to receive approximately $600 million in NASDAQ OMX stock. This gives us over a billion dollars of firepower to grow our profits.