KCG Sees Solid Q1 Growth Across Key Metrics, Equities Shine

Whether it was shares traded or revenues, KCG's Q1 2016 financials shined.

KCG Holdings, Inc. (NYSE: KCG) has released its financial metrics for the first quarter of the 2016 year, with revenues holding a solid QoQ uptrend, also showing improved figures relative to its 2015 counterpart, according to a KCG statement.

During Q1 2016, KCG saw its Non-GAAP revenues climb to $345.4 million, which constituted a strong growth of 30.7% QoQ from just $264.0 million in Q4 2015. This figure was also bolstered by a YoY uptick of 10.9% YoY from $311.1 million in Q1 2015. Furthermore, KCG’s trading revenues also yielded a similar narrative, having climbed to $223.9 million in Q1 2016, up a staunch 53.9% QoQ from $145.9 million in Q4 2015 – by extension, the latest tranche of trading revenues was reflective of a growth of 7.2% YoY from $208.8 million in Q1 2015.

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In terms of quantitative trading volumes, KCG saw an average of 4.2 million trades in Q1 2016, up 13.5% QoQ from 3.7 million trades in Q4 2015 and 7.7% YoY from 3.9 million trades per day in Q1 2015. In particular, NYSE and NASDAQ shares traded rose to 1.1 million in Q1 2016, crossing a key threshold en route to a growth of 46.7% QoQ growth from 770,000 shares in Q4 2015.

Finally, KCG also saw its equities business take off in the first quarter of the New Year. Despite already seeing a multi-quarter growth, KCG saw its average daily Institutional US equities shares traded come in at 271.8 million in Q1 2016, up 14.0% QoQ from 238.4 million in Q4 2015. This growth was even more pronounced when measured against last year, jumping 17.5% YoY from 231.4 million in Q1 2015.

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In the fixed income space, KCG’s average daily BondPoint fixed income par value traded saw a figure of $192.4 million in Q1 2016, a climb of 27.7% QoQ from $150.7 million in Q4 2015 and 32.0% YoY from $145.8 million in Q1 2015.

Daniel Coleman, CEO, KCG Source: Bloomberg
Daniel Coleman, CEO, KCG
Source: Bloomberg

According to Daniel Coleman, Chief Executive Officer of KCG, in a recent statement on the Q1 2016 metrics: “Despite the difficulties presented by the market selloff in the first half of January and heightened competition for retail order flow, market making in U.S. equities generated a substantial contribution to KCG’s first quarter results.”

“We continued to focus on strategic clients as well as develop the pipeline of new strategies and enhance currently deployed models. The results from global equities and FICC rebounded from the previous quarter. KCG Acknowledge FI more than doubled client market making volume in U.S. Treasuries year over year. In Asia, trading during the quarter was led by Japan and Singapore,” he added.

Recently, KCG Holdings (NYSE: KCG) also reported its monthly trading volumes for March 2016, which again saw its overall figures trending in the wrong direction, influenced by factors such as the observance of the Easter holidays, which led to a shortened trading schedule.


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