Interactive Brokers Reveals Strong Financial Metrics for Q3 2017

The increase in Q3 net revenues was primarily due to strong growth in net interest income.

Shortly after the close of the US trading session, Interactive Brokers LLC (NASDAQ:IBKR), a global electronic multi-asset broker and market-maker listed on Nasdaq, disclosed its financial results for Q3 2017, revealing that its metrics managed to improve year-on-year.

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Its net revenues for Q3 2017 amounted to $426 million, higher by 23.5 percent compared with $345 million in the same period last year. Income before tax totalled $268 million, up 46.4% percent year-over-year (from $183 million).

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The increase in net revenue was primarily due to strong growth in net interest income, which jumped 34 percent year-on-year, as did commissions and execution fees. However, the positive figures were partially offset by weak trading gains which dropped by more than 70 percent on lower market making trading volumes as IB completed the wind down of its US options market making business.

Delving further into financial metrics, Interactive Brokers reported diluted earnings per share (EPS) on a comprehensive basis at $0.43 for the quarter ended September 30, 2017, reflecting a 34.3 percent year-over-year uptick from a profit of $0.30 per share during Q3 2016.

Business highlights, according to the company’s press release, included a pretax profit margin of 63 percent which was higher from 53 percent in 2016. During the three month period through September 2017, customer equity grew 40 percent from 2016 to $115.7 billion, while customer debits increased 39 percent to $25.1 billion.

Finally, customer accounts at IB increased 24 percent from the year ago to 457 thousand, while total daily average revenue trades (DARTs) jumped 14 percent year-over-year to 695,000. Relative to last year’s figures, IB reported a climb in brokerage segment equity which totaled $4.6 billion while total equity registered $6.3 billion during the third quarter.

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