GAIN Capital Announces Results For Q2 Of 2013 – Record Net Revenue of $73 Million

In line with the general dynamic within the retail FX industry segment this year, GAIN Capital's metrics for the second

GAIN Capital has today released its corporate results for the second quarter of 2013, having completed the fiscal period with a net income of $17.2 million, which equates to $0.44 per diluted share.

The company’s total net revenue was $73 million.

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Proposed Acquisition of GFT Still On The Cards

As with many firms which achieve solid results, GAIN Capital has shown an interest in acquisitions this year, manifesting itself in April’s announcement that the company had signed a definitive agreement to purchase GFT just one day after compatriate forex company FXCM made an unsolicited bid to buy GAIN Capital.

Glenn Stevens, CEO GAIN Capital
Glenn Stevens, CEO, GAIN Capital

This particular transaction is still in process, and as the second quarter of this year concluded, GAIN Capital’s CEO Glenn Stevens made a corporate statement regarding its current position: “As previously announced, closing of the GFT transaction is subject to customary conditions, not all of which have been satisfied. We are continuing to work through issues that must be resolved in order to close,” said Mr. Stevens.

The company has confirmed that it can offer no update at this time regarding the timing, and changes to the terms, if any, of the transaction.

Metrics For First Half Of 2013

(Comparisons below are referenced to first half of 2012)

•Net revenue of $122.8 million, compared with $78.9 million
•Net income of $21.4 million, or $0.56 per diluted share, compared with $3.2 million, or $0.08 per diluted share
•EBITDA and EBITDA margin of $34.4 million and 28.0%, respectively, compared with $10.1 million and 12.7%
•Retail OTC trading volume of $894.0 billion, up 23.2% from $725.9 billion
•Institutional trading volume of $2.0 trillion, up 114.8% from $910.5 billion
•Futures DARTs of 13,814

Metrics For Second Quarter Of 2013

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(Comparisons below are referenced to second quarter 2012)

•Record net revenue of $73.0 million, compared with $45.7 million
•Net income of $17.2 million, or $0.44 per diluted share, compared with $4.4 million, or $0.11 per diluted share
•EBITDA and EBTIDA margin of $26.9 million and 36.8%, respectively, compared with $8.9 million and 19.4%
•Retail OTC trading volume of $462.1 billion, up 35.6% from $340.8 billion
•Institutional trading volume of $1.1 trillion, up 140.9% from $442.5 billion
•Futures Daily Average Revenue Trades (DARTs) of 14,382
•Total retail client assets of $476.8 million, compared with $320.2 million

Retail OTC Trading Business

In the second quarter of 2013, GAIN’s retail OTC trading business generated revenue of $57.5 million, compared with $40.8 million in the second quarter of 2012. Total trading volume was $462.1 billion, compared with $340.8 billion a year earlier. Active accounts at the end of the second quarter 2013 totaled 64,144, compared with 61,746 a year earlier.

Commission-Based Business

GAIN’s commission-based business, which comprises the GTX institutional platform and the exchange-traded futures brokerage, generated total revenue of $14.2 million in the second quarter of 2013, compared with $4.3 million a year earlier.

GTX revenue was $7.8 million in the second quarter, compared with $4.3 million a year earlier. The futures business, which was acquired in the third quarter of 2012, posted revenue of $6.4 million in the second quarter of 2013.

GTX volume in the second quarter was $1.1 trillion, compared with $442.5 billion a year earlier. Futures (DARTs) were 14,382 in the second quarter of 2013.

Declaration of Quarterly Dividend

The Company also declared a $0.05 per share quarterly cash dividend, payable on September 20, 2013 to all holders of common stock as of September 12, 2013.

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