Fxall a leading independent global provider of electronic foreign Exchange trading solutions, today reported financial results for the first quarter of 2012.
For the first quarter of 2012, revenues increased 10% to $30.0 million from $27.4 million in the first quarter of 2011. Adjusted Net Income decreased 12% to $5.2 million, or $0.18 per share, from $5.9 million or $0.20 per share for the same period last year. Net Income decreased 10% to $4.6 million, compared with $5.1 million for the same period last year. Assuming the conversion of our Series A Preferred Shares to common shares on a pro forma basis as of the beginning of the period, net income per share was $0.16. Reflecting the conversion of the Series A Preferred Shares at the completion of the Initial Public Offering, earnings per share was $0.13. A full reconciliation of GAAP to non-GAAP financial measures is included with this release.
"Our first quarter results reflect the continued strength of our platform and the investments we are making to maintain our leadership in the electronic institutional foreign exchange market," said Phil Weisberg, Chief Executive Officer of FXall. "The increase in our volumes during the quarter amidst a volatile market environment highlights the depth of our relationships globally and the quality of our product. I would also like to recognize the entire team at FXall following the successful completion of our recent IPO."
First Quarter 2012 Results
First quarter 2012 total revenues increased 10% to $30.0 million from $27.4 million for the same period last year, predominantly driven by transaction fees which grew 11% to $22.8 million in the first quarter of 2012. User, Settlement , and license fees also contributed to the growth from the first quarter of 2011, up 5% to $7.2 million.
Total average daily volume (counting one side of each trade) was $86.8 billion, an increase of 13% from the first quarter of 2011, driven by growth across both Relationship and Active trading. Average daily volume for Relationship Trading was $68.0 billion, 7% higher than the first quarter of 2011, while average daily volume for Active Trading increased 36% from the first quarter of 2011 to $18.8 billion. The average transaction fee per million in the first quarter of 2012 was $4.11, reflecting $3.58 for Relationship Trading and $6.00 for Active Trading.
Operating expenses were $22.4 million, 21% higher than Q1 2011. The increase in expenses includes additional expenses related to operating as a public company and approximately $1.4 million of non-recurring IPO-related expenses. The non-recurring IPO expenses include $0.6 million in professional fees, $0.5 million in IPO-related compensation expense and $0.3 million of general and administrative expense. Adjusted EBITDA was $11.1 million, down from $12.6 million in Q1 2011. The Adjusted EBITDA margin was 37% compared to 46% in the first quarter of 2011.
The effective tax rate for the first quarter was 39.8% compared to 42.8% in the first quarter of 2011.
Capital expenditures for the quarter ended March 31, 2012 were $5.1 million, compared with $2.0 million in the same period in 2011 and $4.5 million in Q4 2011.
At March 31, 2012, cash, cash equivalents and investments available-for-sale were $56.0 million.
Financial Measures
Adjusted Net Income and Adjusted EBITDA are non-GAAP financial measures. The Company believes that these non-GAAP financial measures, when taken into consideration with the corresponding GAAP financial measures, are important in understanding the Company's operating results. See the attached schedule for a full reconciliation of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP.
Forexmagnates team have written a detailed report on daily trade volumes in the institutional FX market, available in the Q4 2011 quarterly report.
