Institutional Financial Markets, Inc. (NYSE AMEX: IFMI), an investment firm specializing in credit-related fixed income investments, today reported financial results for its second quarter ended June 30, 2012.
Adjusted operating income was $2.8 million, or $0.17 per diluted share, for the three months ended June 30, 2012, compared to adjusted operating loss of $4.1 million, or $0.26 per diluted share, for the three months ended March 31, 2012, and adjusted operating income of $3.0 million, or $0.18 per diluted share, for the three months ended June 30, 2011. Adjusted operating loss was $1.3 million, or $0.08 per diluted share, for the six months ended June 30, 2012, compared to adjusted operating income of $7.2 million, or $0.45 per diluted share, for the six months ended June 30, 2011. Adjusted operating income (loss) is not a measure recognized under generally accepted accounting principles (“GAAP”). See Note 1 on page 3.
“During the second quarter, we saw improvement in our operating results,” said Daniel G. Cohen, Chairman and Chief Executive Officer of IFMI. “The cost cutting measures we implemented during the second half of 2011 have had a real impact on our results, as our non-compensation operating costs were at their lowest level in almost three years. While some general market weakness persists, our net trading revenue increased 13% from the first quarter of 2012, and 23% from the second quarter of 2011. We are encouraged by this positive momentum and will continue to work to increase value for our shareholders.”
Revenue was $25.0 million for the three months ended June 30, 2012, compared to revenue of $18.8 million for the three months ended March 31, 2012, and revenue of $23.5 million for the three months ended June 30, 2011. The increase in revenue in the second quarter of 2012, as compared to the first quarter of 2012, was primarily the result of a $5.2 million unrealized mark-to-market loss on the Company’s Star Asia investment in the first quarter of 2012, as well as an increase in net trading revenue of $2.3 million. The second quarter 2012 year-over-year increase in revenue was primarily the result of an increase in net trading revenue of $3.7 million, which was partially offset by decreases of $0.9 million in new issue and advisory revenue, $0.6 million in asset management revenue, and $0.5 million in principal transactions and other revenue.
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