Investment Technology Group (NYSE: ITG), a leading agency broker and financial technology firm, today announced that for the second quarter ended June 30, 2009, net income was $20.3 million, or $0.46 per diluted share, versus net income of $25.7 million and earnings of $0.58 per diluted share in the second quarter of 2008.
ITG's revenues for the second quarter of 2009 were $168.0 million versus $180.4 million for the second quarter of 2008. Pre-tax margins in the second quarter of 2009 were 20.2 percent compared to 24.4 percent in the second quarter of 2008.
On a sequential basis, second quarter earnings rose 59 percent compared to earnings of $0.29 per diluted share in the first quarter of 2009. Excluding severance charges, earnings per diluted share rose 23 percent in the second quarter of 2009 compared to the first quarter. Revenues for the second quarter of 2009 were up 8 percent versus the prior quarter, while pre-tax margins, excluding severance charges, rose by 2 percentage points.
"The second quarter was marked by a degree of stabilization in US pricing and volumes, as inflows into equity mutual funds turned positive," said Bob Gasser, ITG's Chief Executive Officer and President. "However, the overall economic environment remains challenging and our core active customers have yet to return to their previous level of engagement with our execution product suite."
ITG's non-US revenues were $46.0 million in the second quarter of 2009 versus revenues of $48.6 million in the second quarter of 2008. Non-US operations generated net income of $2.2 million in the second quarter of 2009, compared to $1.3 million of net income in the second quarter of 2008. Non-US revenues were up 20 percent in the second quarter of 2009 versus the trailing quarter, while net income moved to profitability after a net loss of $2.1 million in the first quarter of 2009.
"Our top line results in Europe improved compared with the first quarter of 2009 along with market conditions, while margins were positively affected by many of the initiatives we have put in place to take advantage of changes in market structure," said Mr. Gasser. "In the Asia Pacific region, our revenues significantly outperformed market turnover gains compared with the first quarter of 2009 as we improved traction with clients under our new leadership team. Along with our consistently profitable Canadian business, we are pleased with the international results we have achieved from the deployment of ITG's capabilities around the globe."
Year to Date results
For the six months ended June 30, 2009, revenues were $323.6 million compared to $384.6 million in the prior year. Net income was $33.1 million and diluted earnings per share were $0.76 in the first half of 2009 versus net income of $58.7 million and diluted earnings per share of $1.33 in the first half of 2008.
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