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ITG Q3 profit slides

29 October 2009  |  1399 views  |  0 Source: Investment Technology Group

Investment Technology Group (NYSE: ITG), a leading agency broker and financial technology firm, today announced that for the third quarter ended September 30, 2009, net income was $17.5 million, or $0.40 per diluted share, versus net income of $27.2 million and earnings of $0.62 per diluted share in the third quarter of 2008.

ITG's revenues for the third quarter of 2009 were $158.4 million versus $188.3 million for the third quarter of 2008. Pre-tax margins in the third quarter of 2009 were 17.7 percent compared to 24.2 percent in the third quarter of 2008.

"The third quarter saw mutual fund flows directed largely towards international funds and index funds, with flows to our core active domestic clients turning negative in August," said Bob Gasser, ITG's Chief Executive Officer and President. "While this made for a challenging environment, we are confident that the market will see a recovery in these fund flows and that we will benefit from the strong operating leverage of our platform. We continue to manage costs aggressively while investing selectively in markets and products that hold promise for our top and bottom lines with the return of improved market conditions."

ITG's non-US revenues were $43.8 million in the third quarter of 2009 versus $47.2 million in the third quarter of 2008. Non-US operations posted net income of $0.2 million in the third quarter of 2009, compared to $0.6 million of net income in the third quarter of 2008.

"Our European business benefited from product parity with North America as well as declining transaction processing costs, and we are well positioned to benefit from additional market recovery. ITG posted its second profitable quarter in a row in Europe and its third quarter of sequential increase in revenue," said Mr. Gasser. "While our core client business in Canada remains strong, revenues were pressured by declining market volumes and a rapidly changing market structure. In the Asia Pacific region, better stock price performance did not correlate with higher turnover across the region, yet we did grow our revenue and gain market share. We continue to invest heavily in people, products and relationships as we position the firm for a greater role in the Asia Pacific markets."

Year to Date results

For the nine months ended September 30, 2009, revenues were $482.1 million compared to $572.9 million in the prior year period. Net income was $50.6 million and diluted earnings per share were $1.15 in the first nine months of 2009 versus net income of $85.9 million and diluted earnings per share of $1.95 in the first nine months of 2008.

Read the full statement here:

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