GAIN Capital posts 118% annual rise in net income in Q1’15


GAIN Capital Holdings Inc (NYSE:GCAP), an international provider of online trading services, has just reported its financial metrics for the first three months of 2015. Markets have been curious to see the financial results of the company that said it made a profit on Black Thursday, whereas many of its competitors struggled to remain afloat.

The broker celebrated double-digit annual rise in revenues and a stunning 118% annual jump in income. Although the results were less strong than in the final quarter of 2014, Glenn Stevens, GAIN’s CEO had an occasion to praise the business.

“We are extremely pleased with our performance in the first quarter,” said Glenn Stevens, Chief Executive Officer. “We distinguished ourselves yet again through our risk management expertise during the SNB event on January 15, strengthening our competitive position while allowing us to deliver positive financial results for the quarter. Importantly, we delivered a double digit increase in profitability on a year-over-year basis, as we continued to execute on our strategic plan to achieve scale and diversify our products and revenue streams, while also tightly controlling our operating expenses,” continued Mr. Stevens.

Financial metrics highlights for Q1 2015:

  • Net income totaled $8.3 million, up 118% from Q1 2014 and down 52.8% from Q4 2014.
  • Net revenues totaled $92.9 million, up 14% from Q1 2014 and down 19% from Q4 2014.
  • Earnings per diluted share reached $0.18, up 100% from Q1 2014.
  • Cash earnings per diluted share amounted to $0.27, up 69% from Q1 2014.
  • Adjusted EBITDA totaled $19.7 million, up 63% from Q1 2014.

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Retail OTC Business

In the first quarter of 2015, GAIN’s retail OTC business generated trading revenue of $66.1 million, up 29% from $51.2 million in the first quarter of 2014. Retail OTC trading volume was $798.6 billion, up 40% from $572.3 billion in the first quarter of 2014. Average daily retail OTC trading volume was $12.6 billion, up 38% from $9.1 billion in the first quarter of 2014.

In the first quarter of 2015, the retail OTC business generated $2.4 million of commission revenue from our advisory business which was acquired in July 2014.

Institutional Businesses

In the first quarter of 2015, revenue from the GTX business increased to $9.9 million compared to $8.8 million in the prior year quarter. Average daily volume for GTX was $19.6 billion in the quarter, an increase of 2% over the prior year quarter. Revenue from the Sales Trader business was $5.5 million, compared to $14.5 million in the prior year quarter. The decrease in revenue in our Sales Trader business reflected the steps taken in the fourth quarter of 2014 to reposition the business on customers with a higher return of capital.

Futures

The exchange-traded futures business generated revenue of $10.4 million in the first quarter of 2015, up 60% from $6.5 million in the first quarter of 2014. Total futures contracts were 2.4 million in the first quarter of 2015, up 51% from 1.6 million in the first quarter of 2014. Average daily futures contracts were 39,034, up 56% from 24,960 in the first quarter of 2014.

City Index

City Index’s preliminary results for the first quarter of 2015, under U.K. GAAP, include net revenue of $37.2 million, up 33% from $27.9 million in the first quarter of 2014 and adjusted EBITDA* of $2.0 million, up 82% from $1.1 million in the first quarter of 2014. Total trading volume was $286.1 billion, up 22% from $234.7 billion in the first quarter of 2014.

After finalizing the acquisition of City Index on April 1, 2015, GAIN will consolidate City Index results starting with the second quarter of 2015.

Dividend

GAIN’s Board of Directors declared a quarterly cash dividend of $0.05 per share of the Company’s common stock. The dividend is payable on June 23, 2015 to shareholders of record as of the close of business June 12, 2015.

To view the official announcement on GAIN Capital’s first-quarter results, click here.

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GAIN Capital posts 118% annual rise in net income in Q1'15

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