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FXCM Inc. Announces Second Quarter 2012 Results

Stocks in this article: FXCM

FXCM Inc. (NYSE: FXCM), a leading online provider of foreign exchange, or FX, trading and related services, today announced for the quarter ended June 30, 2012, revenues under US GAAP of $91.7 million, compared to $103.3 million for the quarter ended June 30, 2011, a decrease of 11%. Adjusted Pro Forma EBITDA for the second quarter 2012 was $21.0 million, compared to $28.5 million for the second quarter 2011, a decrease of 26%. Adjusted Pro Forma Net Income was $7.9 million for the second quarter 2012, compared to $15.6 million for the second quarter 2011, a decrease of 50%. Adjusted Pro Forma fully diluted earnings per share for the second quarter 2012 of $0.11 on a fully exchanged, fully diluted basis, compared to $0.21 per share for the second quarter 2011, a decrease of 48%. U.S. GAAP net income (loss) was $(1.4) million for the second quarter 2012, compared to $3.3 million for the second quarter 2011. U.S. GAAP earnings (loss) per share for the second quarter 2012 was $(0.06) per fully diluted Class A share, compared to $0.19 per fully diluted Class A share for the second quarter 2011.

Second quarter 2012 results under U.S. GAAP included $15.8 million of one-time expenses, including $11.9 million relating to employee severance and the renegotiation of certain employment contracts in its institutional foreign exchange (“FX”) and retail businesses ($11.1 million of which was non-cash, stock based compensation), $2.3 million in regulatory costs in its Japanese business and $1.6 million in due diligence and other acquisition costs. The employee reductions and renegotiation of certain employment contracts in its institutional and retail businesses are expected to lower annual expenses by approximately $5.0 million going forward.

Adjusted Pro Forma results assume the conversion and exchange of all FXCM Holdings, LLC Units into FXCM Inc. Class A common stock, resulting in the elimination of the non-controlling interest and the corresponding adjustment to the entity’s tax provision. In addition, Adjusted Pro Forma results eliminate certain non-recurring charges, including in the second quarter 2012 the $15.8 million of one-time expenses discussed above, and certain equity based compensation expense granted at the time of FXCM’s initial public offering in December 2010.

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