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FOREX.com Sees Net Revenues Hit Record Levels in Q2'2013

Impressive performance results for this year's second quarter started pouring yesterday, as FXCM announced strong numbers. Next up was FOREX.com and if you had expected a bunch of remarkable metrics, you would have been right to do so, because the results are here and they are pretty good.

 
For the three months to the end of June 2013, the company saw its net revenues soar 59.7% against the respective period a year ago to $73 million, a record level for the broker – Kudos. That was due to a large extent to growth in the commission-based business. The broker has one more reason to rejoice, since the jump in revenues was even more stunning than the 53% year-on-year increase registered by its rival FXCM. 
 
And, speaking of impressive results, the net income of  FOREX.com grew to $17.2 million in the second quarter – that's a triple rise from the result seen a year earlier. By the way, the results still do not reflect any effects from the acquisition of GFT, following a deal clinched on April 25, 2013. 
 
The main driver of the performance was client activity: FOREX.com reported retail OTC trading volumes of $462.1 billion for the second quarter, a rise of 35.6% from a year ago, while the reading for the first half of the year stands at $894 billion. Institutional trading volumes were also strong at 
 $1.1 trillion for the second quarter and at $2 trillion for the first half. Wow!
 
And we expect more great news from the broker, especially with regard to its dubbed partnership with Tradable.
 
You can find Forex.com's full report below.
 
BEDMINSTER, N.J., Aug. 7, 2013 /PRNewswire/ -- GAIN Capital Holdings, Inc. ("GAIN") (NYSE: GCAP), a leading global provider of online trading services, reported second quarter 2013 net income of $17.2 million, or $0.44 per diluted share, on net revenue of $73.0 million.
"GAIN Capital's strong results in the second quarter of 2013 demonstrate the significant operating leverage inherent in our business model. Amid more favorable market conditions, net revenues increased 59.7%, while EBITDA rose threefold; EBITDA margin reached 36.8%," said Glenn Stevens, CEO of GAIN Capital. "Our commission-based businesses generated $14.2 million of net revenue, and represented 19.5% of the total net revenues, compared with just 9.4% of total net revenues in the second quarter of last year. This demonstrates our continued success in augmenting GAIN's core retail OTC trading business with fee-based revenue derived from our growing institutional and futures businesses."
"We posted another quarter of positive results across all of our key operating metrics, ending the quarter with higher trading activity in our retail and institutional businesses, as well as a record level of client assets.  Looking ahead to the remainder of the year, each of our business areas are well positioned to benefit from a continued improvement in market conditions," Mr. Stevens concluded.
 
GFT Acquisition
On April 25, 2013, GAIN Capital announced that it had signed a definitive agreement to acquire Global Futures & Forex, LTD (GFT), a global provider of retail forex and derivatives trading.
"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 can offer no update at this time regarding the timing, and changes to the terms, if any, of the transaction.
 
Second Quarter Metrics
(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
 (*See below for reconciliation of non-GAAP financial measures)
 
First Half Metrics
(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
(*See below for reconciliation of non-GAAP financial measures)
 
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.
 
 

About GAIN Capital

 
GAIN Capital Holdings, Inc. (NYSE: GCAP) is a global provider of online trading services. GAIN's innovative trading technology provides market access and highly automated trade execution services across multiple asset classes to a diverse client base of retail and institutional investors.
 
GAIN's businesses include FOREX.com, which provides retail traders around the world access to a variety of global OTC financial markets, including forex, precious metals and CFDs on commodities and indices; GTX, a fully independent FX ECN for hedge funds and institutions; OEC, an innovative online futures broker; and GAIN Securities, Inc. (member FINRA/SIPC), a licensed U.S. broker-dealer.
 
GAIN Capital is headquartered in Bedminster, New Jersey, with a global presence across North America,Europe and the Asia Pacific regions.  For further company information, visit www.gaincapital.com.
TAGS: forex.com  gain capital  forex.com broker  forex trading  forex performance  forex operational metrics  second quarter 2013  net revenues  income  forex trading volumes 

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