Institutional broker INTL FCStone’s consolidated revenue plunges in H2 FY2016

Institutional broker INTL FCStone’s consolidated revenue plunges in H2 FY2016

- in Forex Brokers
INTL FCStone

Institutional multi-asset broker INTL FCStone (NASDAQ:INTL) said on Wednesday its consolidated revenue dropped by an annual 75% to $7.1 billion in October 2015-March 2016, or the first half of the current fiscal year (FY). A year earlier, the brokerage house’s revenue exceeded $28 billion.

In January-March alone, INTL FCStone’s revenue stood at $3.7 billion, or down by 74% from $14.4 billion a year earlier.

The broker’s net income, however, went up bt 4% year-on-year to $23.3 million in the six months, ended 31 March. In January-March, net income saw an increase of 12% to $14.5 million from #13 million a year earlier.INTL FCStone H1 2016

In the securities segment, INTL FCStone posted a operating revenue generated from equity market-making, debt trading, investment banking and asset management increased 26% to $45.6 million in the January-March period, compared to $36.1 million in the prior year. The segment income also went up by 49% on the year to $18.2 million in the second quarter of the fiscal year, primarily as a result of the increases in equity market-making and debt trading operating revenues.

“Our diversified business generated solid core operating results for the quarter which stands in strong contrast to the industry overall.  A strong performance from our Securities segment was offset by a weaker performance in our Commercial Hedging segment,” said Sean M. O’Connor, CEO of INTL FCStone Inc. “We saw a reversal of the immediately preceding quarter’s marked-to-market losses on investments held in our interest rate management program.  For the six months to date we achieved an ROE of almost 12%, which we believe is a best in class performance, but still below our long term target of 15%.”

The brokerage also provided trading volume data (value-wise) for the three months and six months, ended 31 March. The largest value was registered in the forex segment. The largest and only annual increase, both for the half year and the quarter, was also posted in the forex segment. Following are details:

Three Months Ended March 31, 2016

Six Months Ended March 31, 2016

Volumes and Other Data

2016

2015

%
Change

2016

2015

%
Change

On-exchange volume (contracts, 000’s)

26,596.2

26,182.7

2%

50,821.3

51,359.1

(1)%

OTC volume (contracts, 000’s)

302.0

448.8

(33)%

616.7

739.0

(17)%

Global payments (000’s)

101.1

88.7

14%

196.7

157.4

25%

Gold equivalent ounces traded (000’s)

21,619.3

38,145.1

(43)%

45,139.1

71,565.4

(37)%

Equity market-making (gross dollar volume, millions)

$26,108.5

$26,927.2

(3)%

$50,407.2

$51,061.2

(1)%

Forex prime brokerage volume (US notional, millions)

$154,108.5

$108,135.9

43%

$278,660.1

$224,037.6

24%

Average assets under management (USD, millions)

$515.4

$562.5

(8)%

$581.9

$580.5

—%

Average customer segregated equity (millions)

$1,817.0

$1,894.2

(4)%

$1,820.9

$1,979.2

(8)%

US-based INTL FCStone offers globally financial services, including trading in over-the-counter (OTC) forex, metals, and commodities, mainly base metals, precious metals, grains, and livestock. It also provides asset management, investment banking and capital-markets advisory services, and proprietary risk-management tools. The company is features as a Fortune 500 company.

The broker’s clients include professional traders, brokers, banks, and other organizations.

Source: INTL FCStone

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